A Guide for Buyers and Sellers in Sandpoint, Idaho
In real estate, a contingency is a condition that must be met for a transaction to move forward. These clauses protect both buyers and sellers during key stages of the contract. Whether you're buying a home in Sandpoint or listing a property in Sagle or Dover, understanding how contingencies work—and how to navigate them—is essential.
Here’s a breakdown of the most common contingencies used in North Idaho real estate, how they apply locally, and what both sides should expect.
Financial Contingency: When the Loan Falls Through
A financing contingency allows a buyer to back out of the contract and recover their earnest money if they can’t secure final mortgage approval. One of the most common reasons? Job loss. If a buyer loses their job while under contract, they’re typically no longer eligible for their loan—and under this contingency, they’re entitled to a full refund of their earnest money.
However, this protection has a hard stop. Since January 2024, Idaho contracts now include a clause that removes all contingencies—including financial—seven calendar days before closing. After that, if a buyer’s financial situation changes, they’re still expected to close—or risk forfeiting their earnest money.
As a buyer’s agent, I usually write that seven-day limit into the contract. When I’m representing the seller, I try to shorten that window to two or three calendar days before closing to reduce last-minute fallout.
In the Sandpoint market, conventional loans are most common, followed by VA and FHA. Regardless of the loan type, this contingency is crucial to both sides of the transaction.
Inspection Contingency: What the Home Is Hiding
This contingency gives buyers time to hire a home inspector and review the condition of the property. If the inspection reveals major issues, the buyer can renegotiate—or walk away.
Common Sandpoint inspection problems include:
Roof deficiencies due to rain and snow buildup
Mold caused by moisture and high water tables
Improper wiring and missing GFCI outlets
Bathroom vents exhausting into the attic (a big moisture concern)
Fireplace, stove pipe, and HVAC systems needing specialized review
Mold and radon are both common in the area, and most sellers address these issues if flagged—because if they don’t, they’ll need to disclose them to the next buyer.
Whether you’re a buyer or a seller, I always advise focusing on safety and structural concerns first: foundations, roofs, electrical fire hazards, and indoor air quality. These are the issues that matter most—not just during inspections, but in the long-term performance and value of the home.
Appraisal Contingency: When the Price Doesn’t Match the Value
If a property appraises below the agreed purchase price, the buyer can either renegotiate or walk away without penalty—if they’ve included an appraisal contingency.
While large appraisal gaps are rare in the Sandpoint market, they can happen—especially with appraisers unfamiliar with our area. I once had a deal in 2021 where an out-of-town appraiser undervalued a home by over $150,000. We had to go back to the table to renegotiate.
When gaps do occur, you have three main options:
The seller lowers the price to match the appraised value
The buyer brings in cash to cover the difference
The deal is terminated
Why it matters here: In areas with fluctuating values—like custom homes near Lake Pend Oreille or ski-in/ski-out properties at Schweitzer—appraisals don’t always keep pace with rising demand.
→ Explore residential listings in Sandpoint
Home Sale Contingency: When One Deal Depends on Another
This gives a buyer time to sell their current home before purchasing a new one. It’s common with out-of-state buyers relocating to Sandpoint from areas like California or Washington.
If you're relocating to the Sandpoint area, download our relocation guide here.
Locally, we’re seeing quite a few home sale contingencies right now. Whether or not a seller will accept one depends on how far along the buyer is:
Not listed yet? Most sellers won’t entertain the offer.
Recently listed? You’ve got a shot.
Under contract and through inspections? Your chances go way up.
I recently had buyers from Colorado Springs whose home was under contract and set to close within a week. The Sandpoint seller accepted their contingent offer with no hesitation—and within days, the contingency was removed.
On the flip side, I’ve also worked with local clients upgrading their home. They kept running into issues because their current home wasn’t on the market. Once we listed it, everything fell into place within weeks.
Title and HOA Contingencies: The Fine Print
These contingencies allow buyers to review title reports, CC&Rs, and HOA documents. In my experience, these are rarely deal breakers in Sandpoint and surrounding towns.
Buyers usually receive HOA docs and review them before making an offer, and most title issues are resolved during escrow without causing delays. Still, it’s smart to leave this contingency in place until you’ve had time to review everything carefully.
Final Thoughts
Understanding contingencies—whether you're buying or selling a home in Sandpoint—can significantly impact the strength of your contract. Knowing how to use them strategically, or at least recognizing their influence, is essential in today’s market.
Considering selling your home in Sandpoint? Download our guide to help prepare your home.
Want to talk about how to write the strongest offer—or protect your position as a seller? Let’s connect. Whether you’re buying your first home, upgrading, or relocating to North Idaho, the right strategy can make all the difference.