Offer Contingencies in Massachusetts, Explained

A contingency is a condition that lets you walk away and keep your deposit. In a competitive market, buyers are told to remove them to win, and sellers are told to demand their removal. Both bits of advice are given far too casually. Here is what each one actually does, and what it costs to give it up.

How does a Massachusetts purchase actually work?

Massachusetts uses a two-step contract process that surprises people who have bought elsewhere:

1.The Offer to Purchase. A short, binding document — commonly the Greater Boston Real Estate Board form — with the price, the deposit, the closing date, and the contingency deadlines. A deposit of around $1,000 typically accompanies it.
2.The Purchase and Sale Agreement (the P&S). The long contract, usually signed one to two weeks later, prepared and negotiated by attorneys. A larger deposit — conventionally 5% of the price, less what was already paid — is delivered with it.

Attorneys on both sides are standard practice here, not a luxury. Between the offer and the P&S is when the inspection normally happens, and it is the window in which most renegotiation occurs.

The inspection contingency

This gives you a defined period — commonly five to ten days from acceptance — to have the property professionally inspected and to withdraw, or to ask for a price reduction or repairs, based on what is found.

It is the most valuable contingency you have, because it is the only one that protects you against the physical condition of the building. A Massachusetts housing stock that is largely pre-1978 means knob-and-tube wiring, buried oil tanks, failing sewer laterals, asbestos-wrapped ducting and water in basements are all live possibilities, and none of them are visible on a Sunday open house.

It is also, since October 15, 2025, the one contingency a seller is not allowed to ask you to give up. Under 760 CMR 74.00, a seller or their agent may not condition acceptance of an offer on your agreeing to waive or limit a home inspection, and may not accept an offer that requires it — so waiver is not a competitive tactic any more. What remains are middle positions that sellers often accept and that buyers rarely ask for:

Inspect for information only. You still inspect, but you agree in advance not to ask for repairs or credits — you retain only the right to walk. Sellers care about certainty and renegotiation risk more than they care about the inspection itself.
A structural-only threshold. You agree to raise issues only above a stated dollar figure.
A pre-offer inspection. You inspect before you bid, which removes the contingency from the offer entirely while still telling you what you are buying.

A buyer who is already under agreement may still decide not to inspect at all, provided the decision is their own and the parties have signed the mandatory disclosure. What changed is that it can no longer be promised in advance to win the house. the 2025 inspection law covers the exemptions and the enforcement.

The mortgage contingency

This lets you exit if your lender declines to fund. It carries a date, and that date is the thing to watch: it is not "until closing", it is a specific day by which you must either have a commitment or invoke the contingency.

The two mistakes that cause real damage:

Agreeing to a date your lender cannot meet. Ask your loan officer for a realistic commitment date and add a buffer. A pre-approval is not a commitment.
Assuming pre-approval makes the contingency unnecessary. Underwriting can still turn up something — a change in employment, an undisclosed debt, a problem with the building rather than with you. Condominium financing in particular can fail on the association's finances, its owner-occupancy ratio, or its master insurance, none of which have anything to do with your credit.

If you are paying cash, say so and prove it, because that is precisely the risk the seller is pricing.

The appraisal contingency, and the appraisal gap

Your lender will lend against the appraised value, not the agreed price. If the appraisal comes in low, the shortfall is yours to cover in cash or the deal renegotiates.

In competitive rounds buyers increasingly offer an appraisal gap guarantee — a promise to cover a stated amount of any shortfall out of pocket. Be precise about it. "I will cover up to $25,000" is a real, bounded commitment. "I waive the appraisal contingency" is an unbounded one, and if the appraisal comes in $80,000 light you owe the difference or you lose your deposit.

What else sits in the offer

The deposit. A larger deposit signals seriousness, but it is also the amount genuinely at risk if you default. It is not free.
The closing date. Matching the seller's preferred date is frequently worth more to them than a few thousand dollars, and costs you nothing if your own timing is flexible.
Use and occupancy after closing. Letting a seller stay on for a few weeks solves a real problem for a family that has not yet closed on their next home.
Escalation clauses. These raise your bid automatically above competing offers up to a cap. Some listing agents refuse them, and they reveal your ceiling, so use them deliberately.
The personal letter. Fair housing guidance has moved firmly against these, and many brokerages will not pass them on. Compete on terms instead.

What sellers should actually be comparing

Price is one variable among six. A slightly lower offer with a large deposit, a short inspection window, a proven lender and a closing date that matches your move is very often worth more than the top number attached to a shaky financing story. The seller's guide works through how to read a stack of offers, and navigating multiple offers covers the buyer's side of the same moment.

The one rule underneath all of this

Every contingency you remove transfers a specific risk from the seller to you, in exchange for making your offer more attractive. That can be a perfectly good trade. It stops being a good trade the moment you are doing it without knowing which risk you just took on.

Ask your agent to state, for each term you are considering dropping, exactly what happens if the thing it protects against actually occurs. If nobody can answer that in a sentence, you are not ready to sign it.

Nothing here is legal advice, and every term above is negotiable. Massachusetts practice varies by county and by brokerage; your attorney's reading of your specific contract governs.