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Magic Bullets Kill Sacred Cows

Magic Bullets Kill Sacred Cows
No weasels allowed!
Contingencies
Contingencies are often called weasel clauses because some individuals tend to
use them to escape or weasel out of what appears to be a well-written and binding
agreement. Let’s look at some of the more common contingencies that are often
standard (boiler plate) language in many pre-printed contracts and some language
that we just don’t want as well. Then we will insert our own language to seal the
deal.
Contingencies:
Buyer shall apply for a loan in the amount of $______ at __% and if said
loan cannot be obtained buyer(s) shall be released from further obligation.
If you have a pre-qualified/pre-approved buyer with a letter, then this contingency
no longer applies.
This offer is contingent upon physical inspection of the property along with
a satisfactory report. You should have arranged your own home inspection
followed by the appraisal to find and correct any defects that could become barriers
to the sale.
This offer is contingent upon a satisfactory appraisal. If you had your own
appraisal done then you have solid proof that this will not be a major concern.
Often you will see additional language here that says: Buyers are willing to pay
“X” amount equal to the offered price or which ever is less. That means if the
appraisal is less than what they offered they are entitled to buy it at that price! No,
no Fiz! You change that to read: If appraised value is lower, sellers may agree to
renegotiate! Now you have a choice to say no or maybe offer a compromise.
This offer is contingent upon owners’ ability to provide clear title. Your
attorney should have researched this and provided a letter of proof attesting to your
ability to provide clear title at closing.
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