Inspection contingencies on contracts.

[Joseph Arellano]

I have a question for all my fellow investors. When you have a home under contract with an inspection contingency to protect your earnest money deposit, are you allowed to back out of a contract and keep your EMD without doing the inspection on the home?

[Wayne Brooks]

Depends on how the inspection is written….in most cases, yes.  Some contracts have other language….must be a certain amount of repairs, seller has right to correct deficiencies, etc.

[Ramsin Jacob]

Yes, in California you do not have to specially mention to seller or the agent why you are canceling.  If you have the contingency period still alive, you may exercise it at any time during the duration or the contingency.  Simply fill out the 1 page cancelation CAR form and select that you are exercising your property contingency as per the contract and because of that you are obligated to receive your full deposit returned from escrow.