Not Quite Sure When A Contingency Ends? Read This!

We are fortunate to have holidays and weekends to provide us with time for relaxation, fun times with friends and family, and time away from work to recharge. Legal holidays and weekends follow a different rule for contract contingency deadlines. Throughout this week and into the weekend, while most of us will be celebrating the Fourth of July by enjoying the sunshine, cooking burgers on the grill, and playing with fireworks; realtors will likely be working, even on holidays. If you go under contract this week or weekend, please keep in mind the slight variation the contingency deadline has and remember that the Effective Date and Time for Acceptance are exempt from the variation.

Throughout the “As Is” Residential Contract for Sale and Purchase and the Standard Residential Contract for Sale and Purchase, there are some built in contingencies and deadlines, including but not limited to: Loan Approval, Inspection Deadline, Title Examination and Initial Deposit. Additionally, other contingencies can be added to the above mentioned Contracts, such as, Appraisal Contingency or Sale of Buyer’s Property Contingency. If the contingency ends on any day that is not a legal holiday or a weekend, the contingency ends at 11:59 pm. For example, if the Financing Contingency ends July 3, 2019, the contingency ends at 11:59 pm on July 3rd. However, if the contingency ends on a legal holiday or weekend, it is extended to the next business day until 5:00 pm. That being said, if the Financing Contingency ends on July 4th, 2019, the contingency’s new deadline is 5:00 pm on July 5th.

With every rule, there are exceptions. Two exceptions to the “legal holiday and weekend next business day extension” are Time for Acceptance and the Effective Date of the Contract. Both of the aforementioned are not extended by weekends or a legal holiday. For example, if you happen to go under contract on the Fourth of July, that holiday date remains as the Effective Date. Friendly reminder, the effective date of a Contract is the date when the last one of the Buyer and Seller has signed or initialed the Contract and fulfilled the delivery requirement. Even if a Contract is fully executed, it is not effective until it has been delivered to the other party, or agent acting on behalf of the other party.

Berlin Patten Ebling wishes you a fun and safe Fourth of July! As always, if you have any questions about contingencies throughout the contract or when deadlines expire, we urge you to contact one of the attorneys at Berlin Patten Ebling, or consult with your local real estate attorney.

 

Sincerely,

Berlin Patten Ebling, PLLC

Article Authored by Mallory Moretti, Esq. mmoretti@berlinpatten.com

This communication is not intended to establish an attorney client relationship, and to the extent anything contained herein could be construed as legal advice or guidance, you are strongly encouraged to consult with your own attorney before relying upon any information contained herein.

All rights reserved. This copyrighted material may not be re-published without permission. Links are encouraged.

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