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time, money, contingencies - the 3 parts of an offer

Time, Money, Contingencies

If you and I have worked together, you know the three basic aspects of any real estate transaction are; Time, Money & Contingencies. I tell my clients this at the very beginning of working together because transactions are very complicated, and it helps to be able to file the components into quick folders in our minds. This really does help keep us all as grounded as possible during a time of intense change.


The first aspect is TIME. All transactions have a date of the offer, a date that the seller is required to respond to, inspection dates, lender letter commitment dates, and finally a settlement date. Timing is crucial in Real Estate, and your agent is responsible for keeping you abreast and within the time frame on every aspect of the transaction.

Once these time frames are set, they are strict. If the Buyer runs overtime on the Home Inspection time frame, for example, they lose their ability to ask for any defects to be remedied. They lose that contingency because it timed out. Strict!


CONTINGENCIES are variable factors that can make or break a deal. They can come into play in the offer (“Seller to fix rotten wood on porch prior to appraisal”) or they can come into play within the Home Inspection process, (“Per inspection, Seller to ensure that all windows are operable.”)

So your requested repairs are an example of a contingency. Your financing is a contingency. If your financing does not come through as expected, you are not required to close. How can you? You don’t have the money!

So contingencies are weak spots in a contract. Places where the deal can shift, and even die. And the two main contingencies in a Purchase Agreement are Home Inspection and Financing.


Then there is MONEY. This is the third leg of that three-legged stool. Money is also called Purchasing Power, and it is how you are going to make the transaction work. You can sometimes get a better deal financially by tweaking the other two pieces.

For example, if you don’t have a financing contingency because you are paying cash, you can often get a better price. If you do not do a home inspection because you are a qualified contractor yourself and you already looked over the property, that is a variable (or contingency) that the Seller does not have to deal with.

We can mix in the TIME factor here, as well. If you are paying cash and you are a contractor so you are not going to do a formal home inspection, AND you can also close quickly because you are not waiting for a lender to do their thing, then you can often get the best possible deal. WHY? Because the seller has no potential surprises waiting in the wings.

This may seem like a lot. And it is! A real estate transaction is a process where we can see many facets go haywire.

But all of the pieces can generally be organized into one of these three categories “TIME, MONEY, and CONTINGENCIES” and the more we can give in one category, the more leniency we often find in another.

Let me know if you have any questions. Happy to chat about this when you are ready to think about thinking about making that home purchase.


540 294 5005
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Heavily active in and around my hometown of Charlottesville, as well as beautiful Historic Staunton/Augusta where I currently reside. I'm a huge fan of the enjoyable transaction, and aim for creating them in all aspects of my life.

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