Home Sale Contingencies in Real Estate Contracts

Web Admin - Thursday, April 10, 2014

illinois real estate contingencies lawyerBuying a new home is a complicated task that requires a lot of pieces to fall into place in just the right way. For many people, one of these pieces is the ability to sell their current home. Often, people need to sell their old home first to make sure they have enough cash on hand to afford the new one. Of course, sometimes that is not feasible, and people will want to put an offer down on a new house before they have managed to sell their old one. When this happens, people can use a “home sale contingency” clause in their contract to purchase the new home. In short, a home sale contingency clause voids the contract for the sale of the new house in the event that the buyer is unable to sell their old one.

Types of Home Sale Contingencies

There are two broad types of home sale contingencies that lawyers can build into a contract: a “sale and closing contingency” and a “closing contingency.” The sale and closing contingency is used in the event that the buyer has yet to find a prospective buyer for their own home. Conversely, buyers use closing contingencies when they have a prospective buyer who has made an offer for their home, but the sale has not yet closed. In this instance, the contingency acts as an insurance policy against the sale of the buyer’s home falling through at the last minute. While these two types of clauses function in largely the same way, both of them voiding the sale of the new house if the old one does not sell, the sale and closing contingencies are more likely to include a “kick out” clause.

Kick out clauses are a right of first refusal. They allow the seller to keep searching for other buyers for the house. In the event that one of these other buyers makes an offer, then the seller must notify the first buyer. The first buyer then has some period of time to sell their house or else the seller is allowed to make the sale to the new buyer instead.

Factors to Consider When Using a Home Sale Contingency

Buyers should consider two things when deciding whether to ask for a home sale contingency: the effect it will have on the new home’s price and the other costs of purchasing a house. For the first point, home sale contingency clauses will likely drive the price of the new home up. The buyer is asking the seller to take the risk that the buyer’s old home will not sell, and the seller will likely want compensation for bearing that risk.

For the second point, buyers can still end up sinking other costs into the attempted purchase of the new home. They can end up paying for things like home inspections, appraisal fees, and the like, even before they have sold their old house. In the event that the buyer fails to sell their home, then they have wasted any money spent on such things.

If you are in the market for a new house, find an Illinois real estate attorney to help ensure that you receive strong, fair contracts. We serve towns all across northwest Chicago including Palatine, South Barrington, and Mount Prospect.

About the Author: Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.

A Beginner’s Guide to Applying for a Mortgage Loan

Web Admin - Thursday, February 20, 2014

illinois mortgage loan lawyerFor many first-time home buyers, the process of applying for a mortgage can seem complex. This guide will explain the basics of the process, such as the timeline for applying for a mortgage, the documents that applicants should procure and bring, and the credit score and down payment that applicants should expect.

The Mortgage Timeline

The mortgage process begins with a pre-approval application. The purpose of the preapproval process is to let the bank or lender look into the applicant’s finances, in order to make sure that they can afford a loan. This is when banks ask for most of the documentation. Often they want things such as:

- a list of addresses and landlords;
- a list of previous employers;
- pay-stubs from the previous one or two months, with a person’s year-to-date earnings included as well;
- the last two year’s W-2 forms;
- two months of bank statements for all accounts;
- a list of all debts not on the applicant’s credit report; and
- a list of all other real estate that the applicant already owns.

If the applicant has already found a house that they like, and their offer has been accepted, then the bank will also want the seller’s contact information and a copy of the contract. Being ready to provide these documents can help speed up the mortgage process.

Once a person goes through the pre-approval process and has made an offer on a house, the bank will order an appraisal on it. The appraiser will go through the house and determine the value, and then the bank will take their assessment into account when calculating how large a loan they can offer. Generally speaking, the bank will base their offer on either the appraisal value or the purchase price, depending on which is lower.

After the appraisal, the loan underwriter will look at all the documentation to make sure the loan is a good investment for the bank. From start to finish, the whole process usually takes about four to six weeks on the bank’s end, but timelines may vary, and asking the lender in the beginning may be a good idea.

Credit Scores and Down Payments

In addition to the array of documentation, lenders will also expect borrowers to have good credit scores and money available to make a down payment on the house. The rule of thumb for a conventional loan, according to U.S. News, is that a borrower would need a credit score of at least 650. Conventional loans also require, on average, a down payment of around 20 percent. Borrowers may have an alternative in the Fair Housing Act loan, which is a loan insured by the federal government. These loans offer a 3.5 percent down payment with a 580 credit score, and a 10 percent down payment with a 500 credit score.

If you are going through the process of buying a home, contact an Illinois real estate attorney today. Our team serves people in many northwest suburban areas including Inverness, Barrington and Long Grove.

About the Author: Attorney Jay Andrew is founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.

Recent Posts


Retaliatory Discharge Colin H. Gilbert comp time pet law home inspection lawyer Illinois wills and trusts attorneys Illinois registered agent civil rights violation installment contracts Barrington personal injury lawyer boating under the influence real estate lawyer Barrington employment law firm Inverness civil lawyer Barrington employment law attorney insurance dispute, insurance dispute lawyers, insurance claim denial, insurance claim delays, Rolling Meadows insurance dispute attorneys Schaumburg estate attorney sexual harassment Crystal Lake medical malpractice attorneys BAC spinal cord injuries construction accidents, personal injury, wrongful death, Arlington Heights personal injury attorneys, workers' compensation Illinois Human Rights Act mass shooting bicycle dooring accidents living trust vs will operating agreements Des Plaines personal injury lawyers sole proprietorship pedestrian injuries, pedestrian fatality Barrington boating accident attorney Des Plaines accident attorney Des Plaines civil attorney Arlington Heights criminal lawyer federal crimes workplace sexual harassment Illinois insurance claims lawyers Rolling Meadows business lawyer landlord Long Grove real estate attorney head on collisions Illinois will lawyer IRELA Illinois traffic laws vacation home Illinois criminal defense attorney denied insurance claim Crystal Lake car accident lawyer Barrington workers compensation attorney FSLA Attorney Ken Apicella Crystal Lake car accident attorney car accident lawyers real estate leasing Illinois insurance disputes Rolling Meadows probate lawyer Chicago insurance claim attorneys TBI traffic violations murder defense Deer Park employment law attorney Inverness accident lawyer Illinois Sales Representative Act condo association revenge porn Barrington employment attorney Illinois wrongful termination lawyer Class A misdemeanor paid sick leave Schaumburg criminal law attorney murder charges PTSD Illinois workplace discrimination attorney Illinois trucking safety comparative negligence personal injury claim life insurance claims startup company Crystal Lake employment law attorney Des Plaines drug lawyer Buffalo Grove probate lawyer marijuana estate planning, death tax, succession plans, business estate plans, Barrington estate planning lawyers Illinois rollover accident lawyers special needs trust llinois Real Estate Lawyers Association car collision Deer Park traffic accident attorney manufacturing Illinois bicycle safety Illinois medical malpractice claim Kenilworth estate planning attorneys Illinois real estate Rolling Meadows personal injury lawyer Employment Discrimination Law IRS estate planning lawyer Schaumburg injury lawyer estate planning denied insurance claims Des Plaines criminal attorney rollover car crashes texting while driving Whistleblower Claims jet ski accidents Deer Park medical malpractice attorney Inverness personal injury attorney Illinois personal injury Buffalo Grove medical malpractice lawyers CAM compensatory time preventable medical errors vacation home fines Arlington Heights trucking lawyer disability benefits life insurance field sobriety test probate fees insurance agent negligence Arlington Heights lawyer drug crime Mount Prospect real estate lawyer Schaumburg drug defense lawyer work unions digital evidence living trust benefits Do Not Resuscitate Palatine Attorney insurance negligence Palatine probate lawyer DMV POA suspended license Arlington Heights personal injury attorney Buffalo Grove traffic attorney Inverness corporate attorney deed transfer gift taxes Illinois personal injury attorney Buffalo Grove personal injury attorney unpaid overtime medical research DUI attorney Transfer on Death Instrument Jay Andrew real estate pet bites Rolling Meadows employment law attorneys Rolling Meadows medical malpractice lawyers Schaumburg medical malpractice lawyer insurance dispute boating accidents Des Plaines tax law firm Illinois employment law firm Illinois workers compensation lawyer child safety Rolling Meadows Attorney Illinois medical malpractice attorney Rolling Meadows personal injury lawyers swimming pools distracted driving accidents drug possession Chicago car accident lawyer Crystal Lake business law attorneys trucking accidents Chicago trucking accident attorney investment property Schaumburg elder law lawyer Illinois red light cameras Crystal Lake medical malpractice lawyer Buffalo Grove personal injury lawyer Crystal Lake employment attorney auto accidents Crystal Lake insurance lawyer dog bites Buffalo Grove law firm foreclosure commercial leases Arlington Heights TBI attorney liability Palatine punch death Barrington business law firm Palatine insurance lawyer Rolling Meadows boating crash lawyer Long Grove estate planning attorneys Crystal Lake medical malpractice law firm Federal Food Drug and Cosmetic Act owner responsibility trauma after an accident employment lawyer Illinois employment attorneys commercial leasing traffic accidents Illinois car accident attorney insurance claim denial Rolling Meadows Traffic Lawyer Illinois motorcycle accident lawyer Barrington civil litigation attorney Schaumburg employment law attorneys accidental death benefits internet filing a medical malpractice claim bicycle accidents Crystal Lake personal injury attorney insurance denials Illinois collections attorney Arlington Heights wills and trusts lawyers consent to a search Rolling Meadows litigation lawyer wrongful termination, employment law, whistleblower protections, Illinois employment laws, discrimination in the workplace Crystal Lake employment lawyer Long Grove estate planning Inverness insurance attorney car accidents capital gains tax blood alcohol content employment contract insurance claim denials Illinois driving without license caretaker rights Illinois Smoke Detector Act liens slip and fall accidents criminal law medical marijuana insurance claim delay Schaumburg civil litigation attorney Arlington Heights car accident lawyer ObamaCare Long Grove estate planning attorney Des Plaines Chicago insurance law firm Illinois workplace lawyer loopholes traffic deaths Rolling Meadows estate planning attorney changes to mortgage law personal injury attorney corporate law Arlington Heights pedestrian accidents social media after death Schaumburg employment attorney pedestrian accidents preventing accidents Thanksgiving Palatine business attorney traffic offenses license reinstatement agent speeding Inverness probate lawyer Illinois tax attorney Illinois trusts attorney wrongful death Rolling Meadows corporate lawyer residential real estate Des Plaines DUI attorney Policy Cancellation Crystal Lake estate planning lawyer Rolling Meadows criminal lawyer Schaumburg estate planning attorney license suspension crossover accidents probate claims process Food and Drug Administration's Food Safety Modernization Act Chicago employment attorney Arlington Heights wills and trusts lawyer insurance disputes, Illinois insurance disputes, Illinois insurance dispute attorneys, denied insurance claims, Arlington Heights insurance dispute attorneys GM ignition switches Illinois workers compensation attorney wills and trusts Des Plaines Traffic Lawyer Kenilworth estate planning attorney privacy laws BAIID Rolling Meadows car accident lawyers Schaumburg car accident attorney insurance denial appeals subcontractor DUI penalities controlled substance Schaumburg estate planning lawyer pedestrian-automobile accident Illinois home inspection trench injuries Barrington real estate lawyer unauthorized overtime college kids Arlington Heights wills and trusts attorney Deer Park real estate law firm hands free device Inverness elder law lawyer Barrington Illinois estate planning lawyer Barrington Traffic Lawyer Illinois elder law attorney Illinois speeding lawyer Deer Park traffic lawyer Buffalo Grove criminal defense lawyer Schaumburg wrongful death attorney insurance adjusters hiring employees first degree murder traumatic brain injury Long Grove wills and trusts attorneys institutional trustee Arlington Heights personal injury lawyer medical malpractice compensation Detainer Actions tax attorney Illinois employment law marijuana crimes attorney Deer Park accident attorney FMLA wrongful termination Rolling Meadows traffic attorney fatal car accidents Illinois employee rights attorney. icy parking lots insurance claims power of attorney taxes license revocation Palatine civil attorney Palatine injury attorney Long Grove real estate lawyer DNR drug crimes lawyer commercial real estate natural gas explosion Rolling Meadows insurance lawyer insurance claim Crystal Lake traffic attorney Chicago employment lawyer trustee Barrington injury attorney employee rights automated cars Chicago lawyer Palatine drug lawyer Chicago corporate attorney Illinois traffic attorney Schaumburg traffic lawyer Illinois attorney pain and suffering insurance dispute attorney expungement Colin Gilbert Arlington Heights Traffic Lawyer Barrington estate planning lawyer Rolling Meadows drug defense attorney Illinois employment law attorneys Buffalo Grove traffic lawyers Schaumburg criminal attorney Crystal Lake will lawyer Palatine traffic accidents Palatine employment attorney underinsured motorist holiday statistics Rolling Meadows insurance dispute lawyers medical malpractice, missed diagnosis, delayed diagnosis, medical mistake, Deer Creek medical malpractice lawyers Illinois defective products attorney Illinois pedestrian accident attorney Joliet general practice lawyers Crystal lake insurance dispute attorney Barrington criminal defense lawyer Palatine trusts lawyer low-ball insurance settlement loss of consortium Des Plaines personal injury lawyer Des Plaines pet law attorney Affordable Care Act Home Sale Contingencies boating DUI spinal cord injury fiduciary rule Illinois Wage Payment and Collection Act digital information Schaumburg probate attorney pregnant women car crash back injuries South Barrington real estate attorney Deer Park motorcycle accident lawyer involuntary manslaughter Crystal Lake accident attorney Palatine personal injury lawyer drug crimes Arlington Heights tax lawyer traffic crimes insurance claim dispute attorney Illinois estate planning attorney cell phone tower data personal injury trusts insurance disputes Arlington Heights accident attorney Self-Directed IRA Accounts Crystal Lake bike accident lawyer Mount Prospect elder law attorney Illinois boating accident lawyer modern family estate planning Kenilworth estate planning lawyer estate planning for college students Arlington Heights insurance attorney fiduciary rule delay insurance agents Palatine criminal defense lawyer car accident lawyer employment law, meal breaks, rest breaks, hotel employees, Des Plaines employment law attorneys traffic tickets cell phone small business Home Remodeling Repair Act Crystal Lake traffic lawyer Rolling Meadows insurance attorney food poisoning Rolling Meadows Inverness real estate lawyer DGAA life insurance policy fault based insurance defective products Rolling Meadows marijuana attorney car crash injuries wage theft workers comp DUI Legal Info personal injury accidents eluding a police officer business litigation Barrington litigation attorney life insurance lawyer Illinois DUI attorney Crystal Lake tax lawyer civil litigation dram shop law Chicago attorney Palatine elder law attorney digital assets contracts unfunded trust advance healthcare directive products liability Illinois Trust Code Rolling Meadows accident lawyer Illinois insurance lawyer Buffalo Grove car accident lawyer pedestrian accident condo Illinois Des Plaines drug crimes lawyer probate claims Barrington estate planning attorney real estate attorney living wills Illinois living will sexual images Chicago traffic lawyer estate planning trusts Buffalo Grove employment lawyer Illinois mortgages Des Plaines personal injury attorney Des Plaines real estate lawyer overtime violations personal injury law firm severance agreements liability claims healthcare claims uninsured motorist whistleblower protections Arlington Heights injury attorney Palatine civil litigation lawyer real estate attorneys real estate contract license Illinois pet lawyer probate lawyer elder law ACA Inverness estate planning lawyer construction accidents Palatine employment law lawyer Illinois traffic ticket lawyer Chicago will attorney privacy Chicago estate planning lawyer estate tax Schaumburg real estate lawyer estate attorney overtime pay mortgage motorcycle accident underage DUI homestead rights Illinois medical malpractice case ken apicella Arlington Heights estate planning attorney healthcare Deer Park criminal attorney car accident Illinois insurance attorney Des Plaines motorcycle accident attorney Illinois estate planning law firm Illinois insurance claim dispute lawyer Illinois insurance dispute lawyers real estate zoning traumatic brain injuries Arlington Heights real estate lawyer living trust slip and fall breathalyzer test Schaumburg corporate attorney surgical mistakes appealing an insurance claim Crystal Lake law firm Rolling Meadows criminal attorney Mt Prospect Attorney employee discrimination Buffalo Grove insurance claim dispute lawyers estate planning, digital assets, Revised Uniform Fiduciary Access to Digital Assets Act, Illinois digital assets, Illinois estate planning, nursing home negligence jet ski South Barrington real estate lawyer personal injury lawyer bad faith insurance claims Illinois traffic accident lawyer caregiver drugs Chicago will attorney, social media platforms, Illinois estate planning lawyer, Barrington personal injury attorney Palatine construction attorney employees Crystal Lake criminal defense attorney Illinois probate lawyer pizza emoji right to work employment attorney probate Arlington Heights car crash attorneys clemency estate planning attorney dynasty trusts Crystal Lake pedestrian accident lawyer Barrington criminal lawyer Illinois personal injury lawyers Arlington Heights wills and trusts attorneys motorcycle accident lawyer employment contract, employment law, employment at-will, Deer Park employment law attorneys, contract, power of attorney for healthcare no contest clauses Palatine real estate lawyer Illinois law breach of contract BUI traffic violations defense minimum wage medication errors Illinois Probate Act of 1975 creditors Schaumburg personal injury lawyer Rolling Meadows traffic law firm Des Plaines medical malpractice attorney Arlington Heights traffic attorney income distribution deducation Illinois insurance claim dispute lawyers personal injury claims new real estate form LLCs hit and run accident Illinois traffic attorneys elder abuse Crystal Lake injury attorney Palatine traffic lawyer distracted driving accident victims pay when paid contract independent contractor Illinois small business Buffalo Grove real estate attorney criminal record Arlington Heights Attorney Inverness injury lawyer rest breaks attorney fees Illinois medical malpractice lawyers Palatine law firm construction contracts Illinois civil litigation lawyer defective products lawyer Fourth of July medical malpractice claims Schaumburg Attorney Illinois business lawyer Schaumburg rollover accidents Fair Labor Standards Act digital assets, digital fiduciary, estate planning, digital content, Long Grove estate planning lawyers Arlington Heights employment attorney Palatine corporate attorney forming a corporation in Illinois criminal defense Illinois corporate lawyer murder Barrington medical malpractice lawyers in terrorem provision health insurance dispute Barrington drug crime attorney Buffalo Grove corporate attorney rumble strips trucking accident lawyers Illinois wills and trusts estate plan golf accidents natural gas product liability employee misclassification irrevocable trust Palatine estate planning lawyer landlord tenant law guardianship attorney Illinois real estate lawyer Illinois personal injury lawyer Illinois injury lawyer Deer Park workers compensation lawyer premises liability Illinois Workers’ Compensation Commission Des Plaines injury law firm IRA benefits Des Plaines collections attorney federal regulations for LLCs Barrington attorney Liquor Control Act Rolling Meadows real estate attorney truck collisions Mount Prospect wills and trusts lawyers criminal Schaumburg personal injury attorney driving Deer Park personal injury lawyer blended families Des Plaines claims law firm Illinois insurance claim attorney medical malpractice rent to own real estate contracts probate process IRA trust transfer employment law workers compensation benefits Rolling Meadows employment attorney personal injury, auto accident injuries, delayed injuries, serious injuries, Des Plaines personal injury attorneys Illinois estate planning Illinois lawyer foreclosed rental property Illinois jet ski accident lawyer deadly crashes trust payments Forcible Entry gift tax exemption, estate planning, estate planning strategies, Illinois estate planning, South Barrington estate planning attorneys drunk driving car crashes meal breaks Rolling Meadows DUI lawyer Crystal Lake pet attorney digital media accounts, estate planning, Arlington Heights estate planning attorney, dealing with problem employees Crystal Lake personal injury lawyer civil litigation attorney Family Medical Leave Act drunk driving statistics Palatine employment lawyer underfunded trust DUI defense texting and driving Rolling Meadows tax attorney job lawyers real estate closing financial advisors cell phone accidents Rolling Meadows personal injury attorney Rolling Meadows employment law attorney Inverness traffic law firm Riverwoods estate planning lawyer insurance attorney Schaumburg insurance lawyers anesthesia errors workers compensation Des Plaines insurance attorney Illinois employment laws reckless homicide Arlington Heights medical malpractice lawyer traffic laws Illinois business law atorneys Landlord Tenant Ordinance denial of life insurance Palatine corporate law attorneys Illinois Transfer on Death Instrument Illinois employment lawyer wills Arlington Heights employment law attorneys Buffalo Grove injury lawyer Exclusions employment law, Illinois employment laws Chicago biking tips senior citizens Super Mario problem employees Rolling Meadows insurance dispute lawyers, insurance dispute Chicago estate planning Illinois construction accident attorney Deer Park DUI lawyer School Visitation Rights Act Illinois LLC creation Illinois employment law attorney Inverness real estate attorney Inverness DUI lawyer brain injury Crystal Lake civil litigation lawyer Illinois job attorney insurance claim dispute Schaumburg construction accident lawyer Des Plaines real estate attorney bike accident Schaumburg personal injury lawyers unpaid assessment Palatine workers compensation lawyer