What Is a Contingency and Why Does It Exist?
A contingency is a condition in the purchase contract that must be met for the sale to proceed — if the condition isn't met, the buyer can exit the contract and recover their earnest money. Contingencies protect buyers from being locked into a purchase that doesn't make sense. The three primary contingencies in an Ohio residential contract are inspection, financing, and appraisal.
The Inspection Contingency
In Ohio, the inspection contingency gives the buyer the right to hire a professional inspector within a specified window (typically 10–15 days from acceptance) and to negotiate repairs, request a price reduction, or terminate based on the findings. This is your most important protection as a buyer. Read the inspection contingency language carefully — the Ohio contract distinguishes between a 'satisfactory inspection' standard and a specific defect standard. Know what yours says.
The Financing Contingency
The financing contingency protects buyers if their mortgage application is denied or the loan terms change materially. If you can't secure financing through no fault of your own, the financing contingency lets you exit with your earnest money. Most financing contingencies run 30–45 days. If you remove this contingency, you're committing to complete the purchase regardless of whether your loan comes through — only do this if you have the cash to close without the loan.
The Appraisal Contingency
When a lender funds a mortgage, they require the home to appraise at or above the purchase price. If the appraisal comes in low, the appraisal contingency gives the buyer the right to renegotiate the price, make up the difference in cash, or walk away. In a hot market, some buyers waive the appraisal contingency to strengthen their offer — this means you're committing to pay the contracted price regardless of appraised value.
Other Contingencies You May Encounter
Sale of buyer's home contingency — the purchase is contingent on the buyer selling their current home first. Sellers don't love this, and in competitive markets it's often a deal-killer. Home sale contingencies are more viable in a buyer's market. There are also title contingencies (clean title must be delivered) which are standard in every transaction. Understanding which contingencies protect you and which ones can be modified to strengthen your offer is one of the most important strategic conversations in the offer process.