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When a prospective buyer has found the right house and agreed to a price with the seller, the buyer can make a contingent offer. That means that the transaction will proceed, as long as specific contingencies, or conditions, are met. Those contingencies are essential to ensure that each party is aware of all relevant facts and able to make an informed decision. If the contingencies are not met, the would-be buyer can decide not to purchase the house and keep the earnest money provided.

Inspection
The most important contingency from the buyers perspective is the home inspection. A professional inspector will thoroughly check the house for any problems that may not be readily apparent. An inspection should cover everything from the roof to the electrical wiring, plumbing, foundation and possible mold.

If an inspection discovers any cause for concern, the problem will need to be addressed. The buyer can ask the seller to fix the issue as a condition of sale, or the seller can decline to make repairs but agree to lower the sale price. If the parties are unable to reach an agreement, the buyer can decide not to purchase the house and walk away.

Appraisal
An appraisal is another contingency thats designed to protect the buyer. An independent third party will calculate the current fair market value of the house. If the appraised value is less than the asking price, the buyer can renegotiate with the seller or walk away.

If the buyer loves the house and is willing to pay more than the appraised value, obtaining a mortgage may be problematic. A lender will approve a loan up to a percentage of the appraised value. If that number is less than the sale price, the buyer will have to make up the difference with a larger down payment.

Mortgage
If the buyer isnt paying cash, an offer will be contingent on mortgage approval. A buyer may think he or she will qualify, but a lender can reject an application for a variety of reasons. A buyer whos pre-approved for a mortgage may be unable to complete a purchase if the appraised value turns out to be lower than the sale price and the buyer is unable to come up with enough money for a bigger down payment.

A buyer whos unable to obtain a mortgage can walk away. This contingency also helps the seller avoid waiting months for a buyer to get approved for a mortgage and having to turn down other offers in the meantime.

Discuss Contingencies with Your Agent
After a buyer and seller have agreed on a sale price, its natural to want to move quickly, but contingencies are designed to protect both parties. Whether youre buying or selling a house, discuss the importance of a home inspection, appraisal and mortgage approval, as well as the potential ramifications of unforeseen problems in any of those areas, with your real estate agent.

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If you feel the most at home while outside, these four features are sure to cater to your lifestyle.

Access Is Everything

Whether its a ski chalet in the mountains or a waterfront property perfect for boating, your home should provide access to your favorite activities.

Scenic Vistas

Theres just something about a scenic view that delivers a sense of calm and relaxation.

Trees and Plants

From towering trees to secret gardens, adding some vegetation to your property can offer much more than just curb appeal.

Plenty of Storage

You may want a large garage that you can outfit with a few storage racks or a generously-sized mudroom where you can store your gear.

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As new homeowners will learn, borrowers need to provide their lender with proof of homeowners insurance for the full value of the property (usually the purchase price) in order to be approved for the loan.

Typically, the standard insurance policy protects your new property and some possessions against damage or theft. But what, specifically, will it cover?

Limited Damage to the Homes Interior and Exterior
Your insurer will compensate you for repairs or rebuilding costs resulting from fire, hurricanes, lightning, vandalism or other covered disasters. Damage that is the result of floods, earthquakes and/or poor home maintenance is generally not covered unless you have purchased riders for that protection.

Loss or Damage to Personal Belongings
Clothing, furniture, appliances and most other home contents are covered if they are destroyed in an insured disaster. You can even get “off-premises” coverage that enables you to file a claim for lost jewelry, for example, no matter where you lost it. But there may be limits on the amount of protection.

According to the Insurance Information Institute, most insurance companies provide coverage for 50 to 70 percent of the amount of insurance you have on the structure of your home. If your house is insured for $200,000, there might be $140,000 worth of coverage for possessions. If you own expensive art or jewelry, and provide proof of their value, you can purchase a floater policy to fully insure them.

Personal Liability
Liability coverage protects you from lawsuits filed by others. If your dog bites your neighbor, your insurer will pay her medical expenses. If your kid breaks her expensive vase, you can file a claim to reimburse her. And if the neighbor slips on the broken pieces and successfully sues for pain and suffering or lost wages, you’ll be covered for that, too. Experts recommend having at least $300,000 worth of coverage.

Lodging During Repair or Rebuilding
This coverage reimburses you for hotel rooms, meals and other costs you incur while waiting for your home to become habitable after a covered damage. Most policies impose daily or total limits unless you purchase additional coverage.

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Most people who want to purchase a house cant afford to pay cash and therefore need to take out a mortgage. The type of loan you choose will depend on your financial circumstances and plans and can have a significant impact on your monthly costs, so its essential to understand all your options.

Government or Conventional?
The federal government administers several programs to help homebuyers in specific circumstances. The Federal Housing Administration offers loans with down payments as low as 3.5 percent for first-time buyers. The U.S. Department of Veterans Affairs provides loans for current and former servicemembers that require little or no money down. The U.S. Department of Agriculture offers loans for people to purchase homes in rural areas.

If you dont qualify for a government-backed loan, you may be able to secure a conventional mortgage through a bank, credit union or private lender. Since conventional loans arent insured by the government, they are riskier for lenders. Youll need a better credit score to qualify and likely need to put more money down.

Fixed-Rate, ARM or Balloon?
Youll also need to decide whether a loan with a fixed or adjustable interest rate is better for you. A fixed-rate loan can help you plan for the future since youll know exactly how much your mortgage payments will be. That predictability can be extremely valuable if you have or plan to have kids and need to save for college and retirement.

An adjustable-rate mortgage (ARM) will have a low introductory rate, and then the interest rate will periodically adjust based on market conditions. If you have a relatively low income now and expect it to rise in the future, an ARM may be a good choice for you. An ARM may also make sense if you plan to live in your house for only a few years before moving.

The term of the loan is another important part of the equation. A 15-year mortgage will have higher monthly payments than a 30-year loan, but a 15-year loan will have a lower interest rate, which means youll spend less money on interest payments over the repayment period.

With a balloon mortgage, the homeowner makes monthly payments over a period of five to seven years, and at the end of that period, the remaining balance comes due. A balloon mortgage will only make sense if youre absolutely certain that youll sell your home before the balloon payment is due. If you dont, refinancing may not be possible, depending on your credit score, income and the value of the house at that time.

Select a Mortgage Carefully
Buying a house is likely the biggest financial move youll ever make, so choosing the right mortgage is critical. Think about your current and future financial picture, conduct research, compare terms offered by different lenders, and use online calculators to figure out how much youd pay in a variety of scenarios.

This article is intended for informational purposes only and should not be construed as professional or legal advice.

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With these styles, youre guaranteed a kitchen thatll stand the test of time…

Farmhouse Kitchen

A rustic-inspired design, neutral colors combine with exposed wood beam ceilings and butcher-block countertops.

Mediterranean Kitchen

A kitchen that feels like you’re always on vacation. Dark wooden surfaces and ornate lighting create a romantic ambience.

White Kitchen

From coastal getaways to urban abodes, theyre coveted for being light and breezy. Marble countertops and stainless-steel accents are popular.

Modern Kitchen

Colors range from all black to bright and bold, but theres always a sophisticated feel to this minimalist aesthetic.

Traditional Kitchen

This is a surefire way to design a kitchen that combines luxury with timeless appeal.

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