Contract Contingencies for Buyers and Sellers in Crested Butte

There are several contract contingencies for Buyers and Sellers in Crested Butte. There are numerous contingencies or “outs” for the buyer, but very few for the seller. The contingencies all have dates assigned to them. At each date, the buyer has the opportunity to terminate if in their sole opinion they are not satisfied with something. This can be anything from title issues, the inspection, financing, the appraisal, the survey, to HOA documents and more.

Strong vs. Weak Offers

Contract Contingencies for buyers and sellers in Crested Butte also affect offers. Offers are generally referred to as “strong” or “weak”. A very strong offer would have few contingencies and may be a full price cash offer, presented with an earnest money check, and with a quick close date. A weak offer would be a lowball offer conditional upon the sale of another property owned by the buyer, an extended closing date, and dependent upon the buyer securing a loan. In the case of a weak offer there would be quite a few contingencies, which can scare sellers.

Offer Contract with Contingency Example

This is an example of when contract contingencies for buyers and sellers in Crested Butte actually worked out. I represented a buyer of a historical home in town. This was their dream home, but it lacked a full bathroom upstairs where there were two bedrooms. It would require a shed dormer to allow for the headroom to put in a shower in the bathroom. The agent for the seller said the seller had already approached the town previously and, per the architectural review, they were turned down.

I contacted an architect that has designed many homes in town and who has worked with the architectural review board before. He said he thought they would approve it because he would design it differently. The dormer would not be facing the street (bad) but rather facing the adjacent home (good).

We submitted a Contract to Buy and Sell with a contingency that the sale was dependent on the buyer gaining approval from the town for the dormer. The architect had a preliminary meeting and got assurance from the town that his plans would be approved. Meanwhile we were moving through the other contingencies. He subsequently got the plans approved and we closed. The buyers had the dormer and full bathroom added, and are enjoying their home in downtown Crested Butte.

Loan Objection Contingency

Loan Objection Contingency is one of the most important of the contract contingencies for buyers and sellers in Crested Butte. The buyer has the right to terminate the contract if, “in their sole discretion,” (in their opinion) the terms of the financing are not acceptable. The Loan Objection Deadline date is usually the last contingency date on the contract. 

What happens as we approach the Loan Contingency Date and the bank has not given the buyer official notification that the loan is approved? The buyer has to make a decision whether to ask the seller to extend that contingency date, or terminate the contract if they think they will not get loan approval. The seller has to make a decision whether to approve the Loan Contingency Date extension or terminate the contract. They may be thinking that the buyer may not ever get loan approval, and will continue to delay, and no other buyers may be looking at the property since it is under contract.

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Chris Kopf
Broker / Owner
Global Luxury Property Specialist
Coldwell Banker Mountain Properties
Chris.Kopf@CBMP.com
(970) 209-5405