Florida contingencies — inspection, financing, appraisal, sale, insurability

Inspection contingency

Heart of buyer protection. During the inspection period (typically 5 to 15 days), the buyer can order any inspections deemed necessary:

• General home inspection (≈ $350–$700) — overall property condition.
• 4-point inspection (≈ $100–$200) — roof, plumbing, electrical, HVAC. Required by FL insurers.
• Wind mitigation inspection (≈ $100–$200) — documents hurricane protections, earns insurance credits.
• WDO (termite) inspection (≈ $75–$150) — Wood-Destroying Organisms.
• Mold inspection (≈ $200–$600) — if mold suspicion.
• Pool inspection (≈ $150–$250) — if pool.
• Septic / well inspection (≈ $200–$400) — if not on municipal sewer.
• Sewer line scope (≈ $150–$350) — camera in sewer line.

AS-IS Inspection Period vs Standard

In AS-IS mode, the buyer can withdraw for any reason during the period. Highly protective. The Standard version requires defects to exceed a threshold to allow withdrawal.

Deadline and notification

The written notice of withdrawal or renegotiation must be received by the seller (or their broker) before period expiration. Not sent — received. Account for time-zone offset if notifying from Canada.

Financing contingency

If the buyer uses financing (mortgage), they must obtain a written loan commitment or loan approval from the lender within the contract deadline (typically 30 days after effective date).

Financing steps

1. Pre-qualification (informal, before search).
2. Pre-approval (with document verification, ideally before offer).
3. Formal application within 5 days of effective date.
4. Underwriting by the lender (3–4 weeks).
5. Written loan commitment (to receive before deadline).
6. Closing: funds wired to escrow.

Foreign National specifics

For non-resident Canadians, specialized lenders (RBC Bank US, BMO Harris, some smaller FL regional banks) require:

• 30–40 % down payment.
• 3–6 months of bank statements (Canadian and US).
• Income documentation (T4 or Canadian business statements).
• Reference letter from your Canadian bank.
• No US credit score required (often).

Underwriting takes longer than for US residents: plan 45 days of financing contingency instead of 30.

Appraisal contingency

The lender orders an independent appraisal (≈ $400–$800) to verify the property is worth at least the purchase price. The lender will only loan against the appraised value, not the negotiated price.

Three scenarios if appraisal < price

1. Buyer pays the gap in cash. Increases down payment.
2. Price renegotiation with the seller. Seller drops to appraisal level or compromise.
3. Withdrawal with EMD recovery via the appraisal contingency.

In tight markets (snowbird season), many buyers waive the appraisal contingency to make their offer more competitive. Risk: low appraisal, the buyer must cover the gap or lose EMD.

Sale of buyer's property contingency

Lets the buyer make the transaction contingent on selling their current property. This clause:

• Makes the offer significantly less competitive.
• Is rejected by most sellers in tight markets.
• Can be accepted in slow markets with a kick-out clause (the seller keeps the right to keep showing and notify the buyer if a better offer comes; the buyer then has 24–72 h to remove the contingency or withdraw).

For a Canadian: practical alternative = use a bridge loan or HELOC on the Canadian property to fund the US purchase, then sell the Canadian one after.

Insurability contingency (Florida)

Less traditional clause but became critical post-Andrew, Irma, Ian, Helene, Milton. Lets the buyer withdraw if no insurer will cover the property, or if the premium is unacceptably high.

Why it's essential in FL in 2025-2026

• FL home insurance market has been in crisis since 2022.
• Several major insurers have left the state.
• Citizens Property Insurance (public insurer of last resort) now covers ~1.5 million policies.
• Premiums are up 30–80 % in 3 years depending on region.
• A property may be uninsurable on the private market, only available through Citizens at prohibitive cost.

Typical insurability contingency: "This offer is contingent on the buyer obtaining home, hurricane, and flood insurance coverage at acceptable terms and premiums within 14 days of effective date."

Title and survey contingencies

Title contingency

Lets the buyer withdraw if the title chain reveals uncurable defects: tax liens, judgments, forgotten easements, ex-spouse with unextinguished rights. The title agent issues a title commitment within 5–15 days of contract.

Survey contingency

If the buyer commissions a survey (≈ $350–$600), they can withdraw if encroachments are found (neighbor's fence, mis-placed structure), zoning violations, or significant undisclosed easements.

HOA / condo docs cancellation

For a condo, FL legal right (Florida Statutes §718.503): 3-day cancellation after full receipt of condo docs. Documents to receive:

• Declaration of Condominium.
• Bylaws.
• Rules and Regulations.
• Year-end financials for the last 2 years.
• Reserve study.
• Question and Answer sheet (Q&A).
• Frequently Asked Questions and Answers (FAQ).

If any doc is missing, the 3-day window doesn't run. Request written receipt confirmation.

For HOA (non-condo), no strict legal cancel right, but an HOA disclosure rider typically allows 7 days to cancel after receiving HOA docs.

Deadlines timeline

Strategy: how many contingencies to include

Tight market (multiple offers)

To beat competition, many buyers waive several contingencies. But it's risky.

Recommended compromise for Canadians:

• Keep the inspection contingency — non-negotiable, your safety net.
• Keep the financing contingency if financing. Removing it = huge risk.
• Keep the insurability contingency — critical in FL.
• Waive the appraisal contingency in tight markets if you have funds to cover a low appraisal.
• Never include the sale of buyer's property contingency in tight markets — your offer will be ignored.

Normal or slow market

Include all relevant contingencies. The seller will accept in most cases.