The purchase contract decides two things people frequently assume rather than check: under what circumstances you can walk away with your deposit intact, and what is still in the house on the day you get the keys. Both are worth reading closely, because both cause disputes.
Contingencies: Your Way Out
A contingency makes the contract conditional on something being resolved to your satisfaction. If the condition is not met within the stated deadline, you can cancel and recover your earnest money. Contingencies exist because you are agreeing to buy before you know everything about the property.
- Inspection contingency — lets you cancel or renegotiate if a professional inspection finds problems you defined as deal breakers, such as structural defects, failing mechanical systems or wood-destroying insects. See home inspection: what to expect.
- Financing contingency — protects you if your loan is not approved. Pre-approval is not final approval, and this is the gap it covers.
- Appraisal contingency — protects you if the property appraises below the agreed price.
- Title contingency — lets you cancel if the title search finds liens, easements or ownership problems that cannot be cleared.
- Sale of your current home — makes the purchase conditional on your existing home selling. Sellers dislike it, and in a competitive market it can cost you the deal.
- Insurance contingency — increasingly relevant where coverage is hard or expensive to obtain.
Every contingency has a deadline, and deadlines are strict. Miss one and the protection usually lapses, even if you were still waiting on someone else. Diary them on the day you go under contract.
Waiving contingencies is the standard way to make an offer more competitive, and it should be a deliberate decision rather than a reflex. Waiving an inspection does not mean the problems are not there; it means you have agreed to own them.
What Actually Comes With the House
The general rule is that real property conveys and personal property does not. Real property is the land and whatever is permanently attached to it. Personal property is movable — furniture, rugs, potted plants — and leaves with the seller.
The trouble sits in between, with fixtures: items that were personal property until they were attached to the house. Light fittings, wall-mounted shelving, built-in appliances, wall-to-wall carpeting and planted landscaping are normally fixtures and normally convey. But “normally” is doing a lot of work, and buyers and sellers routinely read the same item differently.
The items that most often cause arguments are worth naming: the dining room chandelier, mounted televisions and their brackets, washer and dryer, refrigerator, window treatments and rods, above-ground pools and hot tubs, shelving units, mailboxes, and mature plants a seller intends to dig up.
The fix is simple and takes five minutes: write it down. List every item you expect to remain, by name, in the offer. If the seller intends to take something that looks like a fixture, that belongs in writing too. An assumption is not a term of the contract, and “we discussed it” is not enforceable.
Then verify at the final walk-through, which is the last point at which you have leverage — see closing on a house.