What is a mortgage contingency? How this important contract clause works

Your purchase contract sets the terms, and missing its deadlines could cost you your earnest money. It’s important to review the contingency clause closely, ideally with your agent or a real estate attorney.

A contingency is a condition written into a purchase contract that has to be met before the purchase can be completed. A mortgage contingency clause, also called a financing contingency, gives you a specified period to secure a mortgage.

Between your offer being accepted and closing, yourmortgage lenderverifies your employment, income, assets, debts, and credit history through a process…