What Is an Inspection Contingency in Real Estate?
An inspection contingency lets the buyer have the home professionally inspected within a set time. After reviewing the report, buyers can request repairs, seek credits, or cancel if the contract allows.
✅ How an Inspection Contingency Works
- Inspection window: usually 5–10 days after contract acceptance.
- Requests & repairs: buyer may ask for fixes or credits based on major defects.
- Cancellation rights: if no agreement is reached by the deadline, buyer may cancel as allowed and recover earnest money.
Repairs, credits, and extensions should be documented via an addendum to the purchase agreement.
💡 Why the Inspection Contingency Matters
- For buyers: ensures they know the home’s condition and costs.
- For sellers: sets a structured timeline to resolve issues and keep closing on track.
- For FSBO sellers: clarify “as-is” terms early if you’re selling as-is.
📍 FSBO Tip: Set Expectations in MLS
Use your MLS remarks to note showing rules, known issues, and items excluded from the sale. Clear instructions reduce surprises during inspection.
After negotiations, your title/escrow team will reflect credits and fees on the settlement statement at closing.
🧩 Quick Myths
- “Inspection = code compliance.” ❌ Inspectors report condition; they don’t enforce code.
- “As-is means no inspection.” ❌ Buyers can still inspect; it limits repair obligations.