A “contingency” is a provision contained in a contract which makes it necessary for a specified event to occur in order for the contract to remain in effect. If the event doesn’t occur within the required timeframe, the contract may be terminated. Typical contingencies include an Attorney Approval Contingency (i.e. if my attorney doesn’t approve the contract, I can cancel it), a Mortgage Contingency (i.e. if I don’t qualify for a mortgage, I can cancel the contract); a Purchase Contingency (i.e. if I don’t find another house to buy, I can cancel my contract to sell); a Sale Contingency (i.e. if I can’t sell my house, I can cancel my contract to buy); an Inspection Contingency (i.e. if an inspection of the property by an expert discloses problems I wasn’t aware of, I can cancel the contract), etc.
