Last Updated: February 2026

The home inspection contingency is one of the most important protections in your purchase contract. This clause gives you the right to have the property professionally inspected and, based on what's found, either negotiate repairs, request a price reduction, or walk away from the deal with your earnest money intact.

Understanding how the inspection contingency works—and how to use it strategically—can save you from costly mistakes and give you negotiating leverage. This guide covers everything from standard contingency language to navigating tricky situations when findings don't go your way.

What Is a Home Inspection Contingency?

A home inspection contingency (also called an inspection clause or due diligence contingency) is a contractual provision that makes your purchase offer conditional on a satisfactory home inspection. It's a standard part of most residential purchase agreements.

What the Contingency Does

The inspection contingency gives you the legal right to:

• Hire a professional inspector to examine the property at your expense
• Review the inspection findings before committing to the purchase
• Negotiate with the seller based on what's discovered
• Cancel the contract if issues are unacceptable—and get your earnest money back

Without this contingency, you'd be obligated to purchase the property regardless of its condition, or risk losing your earnest money deposit if you back out.

Types of Inspection Contingencies

Inspection contingencies vary in their terms. Common types include:

• Full inspection contingency: You can cancel for any reason based on inspection findings
• Inspection for informational purposes only: You can inspect but can't request repairs or cancel (sometimes used in competitive markets)
• Pass/fail contingency: You can cancel only if major defects exceed a certain dollar amount
• Limited inspection contingency: Only certain items (like structural or safety issues) can trigger cancellation

How the Inspection Contingency Works

Understanding the process helps you use your contingency effectively:

Step 1: Contingency Begins at Contract Acceptance

When the seller accepts your offer, the contingency clock starts ticking. Your contract specifies the number of days you have to complete inspections and make requests. This is typically 7-14 days from acceptance.

Step 2: Schedule and Complete Inspections

You're responsible for scheduling inspections quickly. This includes:

• General home inspection
• Any specialty inspections (radon, sewer scope, pest, etc.)
• Follow-up evaluations recommended by the inspector

Step 3: Receive and Review the Report

Most inspectors deliver reports within 24-48 hours. Review thoroughly and discuss findings with your real estate agent. Identify:

• Safety hazards
• Major defects requiring expensive repairs
• Items that may affect financing or insurance
• Things you can live with vs. deal-breakers

Step 4: Make Your Request

Before your contingency deadline, you must either:

• Accept the property as-is and remove the contingency
• Submit a repair request to the seller
• Cancel the contract under the contingency terms

Step 5: Negotiate or Close

If you request repairs, the seller can:

• Agree to your requests
• Counter with alternative solutions
• Refuse and risk you canceling

Negotiations continue until you reach agreement, your contingency expires, or someone walks away.

Understanding the Contingency Timeline

Typical Timelines

Sample Timeline (10-Day Contingency)

• Day 1: Offer accepted; schedule inspection immediately
• Days 2-3: Home inspection conducted
• Days 3-4: Receive report; schedule any specialty inspections
• Days 4-6: Complete additional inspections; get repair estimates
• Days 6-7: Prepare and submit repair request
• Days 7-9: Negotiate with seller
• Day 10: Contingency deadline—must be resolved or cancelled

Your Options After the Inspection

Once you have your inspection report, you have several paths forward:

Option 1: Accept the Property As-Is

If the inspection reveals only minor issues or expected findings, you may choose to proceed without requesting anything:

• When appropriate: Minor maintenance items, expected wear for the home's age, issues you budgeted for
• Process: Sign a contingency removal form; inspection period ends
• Risk level: Low—you've seen the issues and accepted them

Option 2: Request Repairs

You can ask the seller to fix specific problems before closing:

• Best for: Safety issues, code violations, items requiring permits, work you want verified
• How to request: Submit a formal repair addendum citing specific issues
• Pros: Work done before you own the home; seller pays directly
• Cons: Seller controls quality; may use cheapest contractor; repairs may be rushed

Option 3: Request a Seller Credit

Instead of repairs, the seller provides money at closing that you can use for fixes:

• Best for: Issues you'd rather handle yourself; when you want to choose contractors
• How it works: Credit appears on settlement statement, reducing your closing costs
• Pros: You control repairs; can use your own contractors; more flexibility
• Cons: You're responsible for getting work done; lender may limit credit amount

Option 4: Request a Price Reduction

Lower the purchase price to account for needed work:

• Best for: Large-ticket items like aging roof or HVAC; when seller doesn't want to deal with repairs
• Pros: Reduces your loan amount; no credit limits
• Cons: May not have immediate funds for repairs; affects appraisal value

Option 5: Cancel the Contract

Walk away from the purchase and get your earnest money back:

• When appropriate: Major unforeseen problems; repairs exceed budget; seller refuses reasonable requests; you've lost confidence in the property
• Process: Submit written cancellation notice before contingency deadline
• Result: Contract is void; earnest money returned; you're free to buy elsewhere

How to Negotiate After the Inspection

Effective negotiation keeps deals together while protecting your interests:

What to Request

Focus your requests on:

• Safety hazards: These are hard for sellers to refuse (electrical issues, missing railings, gas leaks)
• Major defects: Items that affect livability or value significantly
• Unexpected findings: Problems not visible during showings or disclosed upfront
• Items affecting financing/insurance: Lenders or insurers may require certain repairs

Typically NOT worth requesting:

• Cosmetic issues (paint, worn carpet)
• Normal wear for the home's age
• Items you knew about when making your offer
• Minor maintenance (caulking, weatherstripping)
• Things disclosed by the seller

Negotiation Strategies

1. Get real estimates: Know actual repair costs before negotiating
2. Prioritize: Focus on what matters most; be willing to let go of minor items
3. Be reasonable: Asking for everything guarantees pushback
4. Consider the market: Your leverage varies based on supply and demand
5. Think creatively: Credits or price reductions may work better than repairs
6. Keep emotions out: This is a business negotiation

Sample Repair Request Language

When to Walk Away from a Purchase

The inspection contingency exists for a reason—sometimes walking away is the right choice:

Good Reasons to Cancel

• Major structural problems: Foundation failures, significant settling, rot
• Environmental hazards: Extensive mold, asbestos, or contamination requiring remediation
• Repair costs exceed your budget: When fixes cost more than you can afford
• Seller refuses reasonable requests: Won't address legitimate safety or major concerns
• Evidence of cover-ups: Fresh paint over water stains, hidden damage
• Multiple major system failures: Everything needs replacement simultaneously
• Unpermitted major work: Additions or renovations done illegally
• Insurance or financing problems: Issues that prevent you from closing

How to Cancel Properly

1. Review your contract: Understand the cancellation requirements
2. Meet the deadline: Cancel before your contingency expires
3. Put it in writing: Submit formal cancellation notice as specified in the contract
4. Document your reasons: Reference inspection findings that justify cancellation
5. Request earnest money return: Follow procedures for getting your deposit back
6. Communicate through your agent: Let professionals handle the notification

Should You Waive the Inspection Contingency?

In competitive markets, buyers sometimes waive contingencies to make offers more attractive. Here's what you need to know:

Risks of Waiving

• No protection: You're obligated to buy regardless of what's found
• Hidden problems become your problems: Major defects are now your expense
• No negotiating leverage: You can't use findings to request repairs or credits
• Potential financial disaster: Serious issues could cost tens of thousands
• Emotional commitment: Harder to walk away once you're invested

Alternatives to Completely Waiving

If competing requires flexibility, consider these alternatives:

• Pre-offer inspection: Inspect before making an offer (seller permission required)
• Shortened timeline: Offer a 3-5 day contingency instead of waiving entirely
• Inspection for information only: You can inspect but won't request repairs
• High threshold: Only cancel if repairs exceed a large dollar amount (e.g., $10,000+)
• Limited scope: Only structural/safety issues allow cancellation

If You Must Waive

If market conditions force a waiver, protect yourself:

1. Get a pre-offer inspection: Know what you're buying before committing
2. Have cash reserves: Budget 3-5% of purchase price for potential repairs
3. Review disclosures carefully: Look for any red flags
4. Research the property: Check permit history, previous listings, flood maps
5. Walk through thoroughly: Look for signs of problems during showings
6. Consult your agent: Get their honest assessment of the property's condition

Other Contingencies to Know About

The inspection contingency is just one of several contingencies that protect buyers:

• Financing contingency: Allows cancellation if you can't get a mortgage
• Appraisal contingency: Protects if the home appraises below purchase price
• Title contingency: Ensures clear title can be transferred
• Home sale contingency: Makes purchase dependent on selling your current home
• HOA review contingency: Time to review HOA documents and financials

Each contingency provides different protection. Discuss all contingencies with your agent when writing offers.

Frequently Asked Questions

Can I do multiple inspections during the contingency period?

Yes. You can schedule as many inspections as needed within your contingency period—general inspection, radon, termite, sewer scope, structural engineer, etc. Just ensure everything fits within your timeline.

What if the seller refuses all my repair requests?

You can accept the property as-is, continue negotiating (perhaps offering to split costs), or cancel under your contingency. The seller isn't obligated to agree to repairs.

Can I extend the inspection contingency deadline?

Only with the seller's agreement. Request extensions in writing before the deadline expires. In competitive situations, sellers may refuse extensions.

What if I find problems after the contingency period ends?

Once you remove the contingency, you've accepted the property. Your only recourse would be if the seller actively concealed known defects (which may be actionable as fraud in some jurisdictions).

Does the inspection contingency cover everything?

Standard contingencies cover the general home inspection. Specialty inspections (radon, mold, pest, sewer, etc.) may require separate contingencies or be included under a broader "due diligence" clause. Check your contract.

Can sellers see my inspection report?

In most states, sellers aren't entitled to see your report unless you share it. However, some jurisdictions require disclosure if you cancel. Consult your agent about local requirements.

What if the inspection reveals issues the seller didn't disclose?

Sellers are generally required to disclose known material defects. If the inspection reveals problems they knew about but didn't disclose, you may have legal recourse. Document everything and consult with your agent or attorney.

Tips for Using Your Contingency Effectively

1. Act quickly: Schedule inspections immediately after contract acceptance
2. Attend the inspection: See issues firsthand and ask questions
3. Get specialist opinions: When the inspector recommends further evaluation
4. Know your deadline: Track dates carefully to avoid losing your rights
5. Be strategic: Focus requests on significant issues, not nitpicks
6. Get real estimates: Support requests with actual repair costs
7. Stay flexible: Consider credits instead of repairs when appropriate
8. Trust your gut: If something feels wrong, it probably is
9. Use your agent: Let them handle negotiations professionally
10. Keep emotions in check: Make decisions based on facts, not feelings