Mortgage Contingency

Should you consider a mortgage contingency?

A mortgage contingency might be good to include in your purchase contract because it protects the parties involved from various issues that may come up during the homebuying transaction. It primarily exists to protect the buyer, but it can also be used to protect the seller from unqualified buyers.


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The contingency is written into your offer and provides a release from the contract if, for example, the buyer can’t get the appropriate financing.

Buying and selling together

A contingency is also helpful if you’re trying to buy and sell a house at the same time. You can make an offer on the home you want to buy, but put a contingency that the transaction depends on the sale of your current home. However, the other seller can still consider marketing their home to other buyers and could accept an offer that doesn't contain a contingency.

Timing is critical when buying a new home while selling your old one:

  • If the old home sells before the new home closes, buyers could temporarily stay with relatives, find a short-term rental or negotiate a rent-back period with the buyers.
  • If the new and old homes are scheduled to close on the same day, it's important to tell your lender ahead of time.
  • You must work with your lender and real estate agent to determine dates and deadlines so one transaction doesn't hold up the other.

Most contracts have standard contingencies written into the agreement. Your real estate agent can help determine if a contingency is needed for your circumstance.


Results of the mortgage affordability estimate/prequalification are guidelines; the estimate isn't an application for credit and results don't guarantee loan approval or denial.

All home lending products are subject to credit and property approval. Rates, program terms and conditions are subject to change without notice. Other restrictions and limitations apply.