You may have noticed the phrase "time is of the essence"
... But what does that mean?
It means that deadlines MUST be met ... Or ELSE!
... Or else what?
That depends upon the contract clause. If your agreement says you must complete an inspection by a set date and you don't do it, it means you've accepted the house As-Is.
If the agreement says you must let the seller know about items of concern within a set number of days after an inspection, it means that you have only that many days to back out of the contract or re-negotiate based on the inspection.
The same is true for other contingencies. They must be removed by the specified date or the contingency evaporates.
This can be important to a buyer because depending upon the contingency, it can mean loss of earnest money.
If you present an offer to a seller (or a counter-offer to a buyer) and give him or her 3 days to respond, it means non-response in that time releases you from the offer.
Even the closing date has an "or else." If the buyer doesn't close on the specified date, the seller is no longer obligated to complete the transaction.
If a loan commitment contingency and it has a due date, Seller can be released from the contract. This is important to know!
Of course, when both parties agree, these dates can be changed. But be aware that the other party is never obligated to grant an extension of time.
"Time is of the Essence"
This information is not a substitute for the advice of an attorney.
I am not permitted to engage in the practice of law.
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