The California real estate market is known for its unique set of rules and regulations that govern the buying and selling process. One such provision that plays a crucial role in protecting both buyers and sellers is the 17-day contingency period. In this expert review, we will delve into the intricacies of the 17-day contingency, its significance in California's real estate landscape, and how it benefits all parties involved.

Understanding the 17-Day Contingency:
In California, the 17-day contingency period refers to the time frame during which a buyer can conduct due diligence on a property after an offer has been accepted. During this period, the buyer has the opportunity to thoroughly inspect the property, review disclosures, obtain financing, and ensure the property meets their expectations. It acts as a safeguard, allowing buyers to withdraw from the transaction without any penalties or losing their deposit if they find any issues or change their mind.

Importance for Buyers:
The 17-day contingency period provides buyers with the peace of mind and flexibility needed to make an informed decision. It allows them to conduct inspections, such as home inspections, termite inspections, and roof inspections, to ensure the property is in good condition

In California, a due diligence or contingency period is allowed for sellers to deliver disclosures in seven days. The buyer has 17 days to complete any inspections and apply for financing. At the end of the 17 days, the contingency must be released by the buyer to proceed with the real estate sale.

What is the contingency period in California real estate?

In a real transaction, the contingency period begins as soon as a seller accepts a potential buyer's offer. As an example, in California, the contingency periodfor inspections and appraisals is typically 17 days. Therefore, if you accept the buyer's offer on May 1, the contingency removal date would be May 17.


What does 10 day contingency mean?

An inspection contingency allows the homeowner a specific number of days (typically 7 – 10), to respond with any objections to what's found in the inspection. This ensures the buyer is able to collect enough information to make an informed purchase decision.

What does 14 day contingency mean?

A contingency period is the number of days that a buyer has before they need to remove that specific contingency. The lower the number of days is, the more attractive it looks to the seller.


Can I walk away during due diligence?

This period often includes time for the buyer to conduct due diligence on the property, but the provision makes it possible for the buyer to back out for any reason without penalty.

What is the time frame for a mortgage contingency?

The contingent period usually lasts anywhere from 30 to 60 days. If you have a mortgage contingency, the buyer's due date is usually about a week before closing. Overall, a home stays in contingent status for the specified period or until the contingencies are met and the buyer closes on their new house.

Why is the time period of contingencies critical?

Real Estate Contingency Period

If the buyer doesn't take the necessary steps to ensure the contingencies are met, the contract could fall through and they could lose the home. This also means that sellers will have to put the home back on the market — something that no one wants to happen!

Frequently Asked Questions

Can a seller accept another offer while contingent?

Contingency with a kick-out clause

That means the seller can continue to show the home and accept offers during the sale contingency period. If the seller gets a better offer, they'll allow the original buyer 72 hours to drop the sale contingency and proceed with the deal.

What is the timeline for a contingency?

The contingent period usually lasts anywhere from 30 to 60 days. If you have a mortgage contingency, the buyer's due date is usually about a week before closing. Overall, a home stays in contingent status for the specified period or until the contingencies are met and the buyer closes on their new house.

Do you count the current day when counting days?

When calculating timelines, the day the event occurred is not counted. The next day is counted as day one and the last day of the event is included in the count.

FAQ

What is a 17 day contingency?
A loan contingency removal means the buyer has 17 days to inspect the home, appraise the home, and make sure they are going to be fully qualified for the loan before the deposit is turned over to the seller. This is the “due diligence” time for the buyer to identify any issues with the property.
What are the rules of a contingency contract?
A contingency clause is a contract provision that requires a specific event or action to take place in order for the contract to be considered valid. If the party that's required to satisfy the contingency clause is unable to do so, the other party is released from its obligations.
What is an accepted offer with contingencies?
How Does A Contingent Offer Work? With a contingent offer, you have stated that a certain condition must be met before the sale moves forward. If it doesn't, the contract is void, and the seller can move on to a backup offer received while the sale was contingent.

What are the 17 day contingencyi say for in california real estate

What happens if you don t meet a deadline on a contingency? If not protected by the contingency, and you do not close on time, you could be in breach of contract, lose your earnest money deposit, and the seller could come after you for additional damages.
How do you count calendar days in a real estate contract? Calendar days are counted as “Days” except for initial deposit issues. If the last day for performance falls on the weekend or a holiday, then the last day to perform is extended to the next regular business day. Under Paragraph 27L of the PRDS purchase agreement: TIME: Time is of the essence in this Contract.
How long do you have to remove a contingency? 17 days

The contingencies are not waived automatically after 17 days. However, elapse of the 17-day period allows the seller to deliver a Notice to Buyer to Perform (NBP) giving the buyer two days to remove contingencies.

  • What happens if buyer does not release contingencies?
    • Many purchase contracts give buyers 21 days to release a loan contingency. Again, this is the default. The time frame can be shorter, or it can run to the close of escrow if the contract permits. The seller can cancel the contract at the end of that time if the buyer hasn't signed a release of contingencies.
  • What is put at risk if a buyer misses a contingency deadline?
    • If not protected by the contingency, and you do not close on time, you could be in breach of contract, lose your earnest money deposit, and the seller could come after you for additional damages.

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