Answer: In real estate, a contingency is a condition of the sale agreement that must be met in order for the transaction to proceed. There are several types of contingencies for a buyer to consider: inspection contingency, financing contingency, appraisal contingency, title contingency, and home sale contingency.

Inspection contingency: When we buy a house, we inspect it. It enables us to determine the true state of the house. Although inspection is the most common contingency, it entails more than just checking the state of the house; it also includes checking for mould and termites, among other things. If, after inspecting the property, the customer believes that it is unsuitable or that it will necessitate too much work after the purchase, he or she has the option to walk away from the transaction. This is an example of a contingency.

Financial contingency: This contingency comes into play when you need time to apply for and receive a loan to purchase a home. According to this contingency, if you are unable to obtain financing from the company that is providing the loan facility for that specific house, you have the option of seeking alternative financing or withdrawing from the sale.