Buying a home in Oxford or the greater Oakland County area is exciting, but it also comes with a lot of moving parts. One of the most important pieces is the set of contingencies in your purchase agreement. These clauses can protect you from surprises and help you make confident decisions.
In this guide, you’ll learn what each major contingency means, how they work in Michigan contracts, the timelines to expect, and how to tailor them to homes in Oxford, Lake Orion, and the Warren–Troy–Farmington Hills corridor. You’ll also get a simple checklist and sample timeline you can use right away. Let’s dive in.
What is a home purchase contingency?
A contingency is a clause in your purchase agreement that allows you to cancel or renegotiate if a certain condition is not met within a specific time. Common examples include financing, inspection, and appraisal.
These provisions are standard in Michigan purchase agreements and are often based on forms used by the Michigan Association of REALTORS. Every contingency has a deadline and clear next steps if the condition is not satisfied. The key is understanding your timelines and what happens if you waive or miss a deadline.
Key contingencies for Oxford and Oakland County buyers
Financing contingency
This protects you if you cannot secure a loan on the terms in your offer. You’ll specify the loan type, down payment, and how long you have to get a mortgage commitment. A strong pre-approval helps your offer stand out.
In competitive scenarios, sellers prefer shorter financing timelines, but you still need enough time for underwriting and appraisal. Work with your lender and agent to set a realistic date. If financing falls through within your contingency window, you can usually cancel and recover your earnest money as allowed by your contract.
Home inspection contingency
This gives you time to inspect the property and respond to any issues. Typical inspection windows range from 7 to 14 days, depending on what your contract says. You can request repairs, seek a credit, or cancel within the contingency period if needed.
In Oakland County, older homes can reveal items like outdated wiring, aging roofs, past water entry, or older mechanical systems. In rural or lake-adjacent areas, you may also encounter private wells and septic systems that require specialized inspections. You can keep your offer attractive by keeping the timeline tight but realistic and by focusing on major items in negotiations.
Waiving an inspection can make your offer more competitive, but it increases your risk. A middle path is an inspection with a narrower scope or one that is for “information only,” which lets you learn about the home while signaling flexibility to the seller.
Appraisal contingency
Your lender will likely require an appraisal. If the appraised value comes in lower than the contract price, this contingency lets you renegotiate, ask for a credit, cover a difference, or cancel per your contract terms.
In multiple-offer situations, buyers sometimes offer an appraisal gap. That means you agree to bring a set amount of extra cash if the appraisal is low. Only do this if you have the funds and understand the risk.
Title review contingency
Title work confirms you will receive a clear, marketable title. The title company searches public records for liens, easements, unpaid taxes, or recording errors. A title contingency gives you time to review the title commitment and object to any problems.
In Oakland County, common title issues include outstanding mortgages, tax liens, utility easements, or incorrect legal descriptions. Your contract will spell out who pays for title insurance and how objections are handled before closing.
Home-sale contingency
This makes your purchase dependent on selling your current home. In faster markets, sellers may be hesitant to accept this, or they may add a kick-out clause that allows them to continue marketing the home. If the seller receives a stronger offer, you may be asked to remove your contingency or step aside.
If you need to sell first, consider options like bridge financing or a rent-back arrangement to reduce the contingency load. Ask your agent to structure timelines and proof-of-listing activity to improve your position.
Environmental and special-property contingencies
- Septic and well: Parts of Oxford and northern Oakland County use private wells and septic systems. Include specific inspections and compliance checks so any repairs can be addressed before closing.
- Radon testing: Much of Michigan is considered moderate to high for radon. A radon contingency lets you test and request mitigation if levels exceed the recommended threshold.
- Flood risk: Review FEMA flood maps and county GIS to confirm flood zone status. A floodplain contingency can let you cancel if flood insurance is required or costs are higher than expected.
- Lead-based paint: For homes built before 1978, federal rules require disclosure. Testing options and risk reduction can be handled within your inspection timeline.
How contingencies work in your contract
Deadlines and “time is of the essence”
Every contingency has a clock. If your contract says you have 10 days for inspections, you must act within that window. Typical local ranges include 7 to 14 days for inspections and 21 to 30 days for a loan commitment. Appraisal timing usually follows your lender’s schedule.
If you need more time, extensions must be agreed to in writing. Missing a deadline can be treated as a waiver or even a breach, depending on your agreement, so calendar management is critical.
Waiving or shortening contingencies
Sellers like fewer and shorter contingencies. You should weigh that against your risk. Waiving an inspection or appraisal contingency can help you win in a multiple-offer scenario, but it raises the chance of out-of-pocket expenses later.
Consider strategic compromises. You can limit an inspection to major systems, request an informational inspection, or set a capped appraisal gap. Keep in mind that earnest money can be at risk if you waive protections and later cancel without a contractual right.
If a contingency is triggered
When an inspection discovers a defect or an appraisal comes in low, the next step is negotiation. You might agree on repairs, a price adjustment, or a closing credit. If you cannot reach an agreement, you can usually cancel within the contingency period and recover your earnest money according to the contract.
A smart Oxford buyer’s contingency checklist
Use this checklist to cover the essentials for Oxford, Lake Orion, and nearby communities:
- Financing: pre-approval letter, loan program details, and a clear deadline for loan commitment.
- General home inspection: include structure, roof, HVAC, plumbing, and electrical.
- Pest inspection: wood-destroying insects if indicated by age or location.
- Septic and well: specialized inspections and compliance with county health standards.
- Radon: testing during the inspection period, with agreed steps if mitigation is needed.
- Appraisal: clear language on what happens if value is below the purchase price.
- Title review: title commitment, objection process, and title insurance.
- Survey or boundary verification: if you have concerns about lot lines or easements.
- Floodplain review: confirm flood zone status and insurance requirements.
- Home-sale contingency: if needed, with clear dates and kick-out terms.
- Municipal permits and code: verify permits for additions, decks, accessory structures, and zoning.
A sample 30-day timeline
Here is a simple framework you can tailor with your agent and lender:
- Day 0: Offer accepted and contract signed.
- Days 1 to 10: General inspection and specialty tests scheduled and completed.
- Days 7 to 14: Submit repair requests or elect to proceed or terminate per the inspection contingency.
- Days 14 to 30: Lender underwriting and appraisal; target loan commitment during this window.
- Before closing: Title commitment delivered and cleared, or objections resolved.
- Closing day: All contingency items resolved, funds and keys exchanged.
Strategy tips for today’s market
For buyers
- Strengthen your offer early: secure a strong pre-approval and have proof of funds ready.
- Keep timelines tight but doable: coordinate inspection scheduling and lender milestones before you write the offer.
- Negotiate smartly after inspections: focus on health, safety, and major systems. Credits can be easier than repairs on a short timeline.
- Plan for appraisal scenarios: decide in advance whether you can cover a limited appraisal gap or prefer to keep the full appraisal contingency.
- Be cautious about waivers: do not waive inspection or financing protections unless you fully understand the risks and have a clear backup plan.
For sellers
- Reduce surprises: consider a pre-listing inspection and address major items up front.
- Ask for strong financing proof: a current pre-approval signals reliability.
- Manage contingent offers: use kick-out clauses and clear deadlines if you accept a home-sale contingency.
- Clarify earnest money: make sure the contract states how earnest money is handled if timelines are missed.
Local permitting and compliance checks
Before you waive or shorten contingencies, verify any additions, finished basements, accessory buildings, or past renovations with the local building department. Make sure taxes and special assessments are current, and confirm how they will be prorated. You can add language that allows you to review permits and municipal compliance and cancel if unpermitted work or significant code issues are discovered.
Work with a local guide
Thoughtful contingency planning can win you the home you love while protecting your budget. You do not have to juggle it alone. With two decades of Oakland County experience, a trusted vendor network, and a project-managed approach, our team coordinates inspections, lender timelines, title work, and specialty tests like radon, well, and septic. We help you set competitive but realistic deadlines so your offer stands out without unnecessary risk.
If you are buying in Oxford, Lake Orion, Clarkston, or the Warren–Troy–Farmington Hills area, let’s build a plan that fits your goals. Connect with Emily Ford to schedule your free consultation.
FAQs
What is a home purchase contingency in Michigan?
- A contingency is a contract clause that lets you cancel or renegotiate if a defined condition is not met within a set timeframe, such as financing or inspections.
How long should I allow for inspections and financing?
- Local practice often uses 7 to 14 days for inspections and 21 to 30 days for loan commitment, but your exact deadlines must match your contract.
What happens to my earnest money if I cancel under a contingency?
- If you cancel within the terms of a valid contingency, your earnest money is typically returned; if you cancel without a contractual right, the seller may claim it.
Can I limit my inspection to major systems only?
- Yes, you can narrow the scope to key systems, but this reduces your protection and may miss other issues that affect cost and safety.
What does “as is” mean for an Oxford-area home?
- It means the seller is not obligated to make repairs, but required disclosures still apply; your rights depend on whether you keep an inspection contingency.
How does a low appraisal affect my purchase?
- A low appraisal may reduce your loan amount; you can renegotiate, cover a difference, or cancel if your appraisal contingency allows it.
Should I include a home-sale contingency?
- It can help if you need proceeds from your current home, but it may weaken your offer in a competitive market; consider bridge financing or a rent-back.
