Writing an offer in a changing market requires one to be more cautious when it comes to contingencies.  A standard finance contingency of 3 to 10 days might no longer be enough. Loans are still available for qualified buyers. The mortgage broker or direct lender chosen by the buyer will communicate how much time he needs to get a firm loan commitment. This time frame has determined how long of a contingency one will write into the offer.

Recently I have heard  of several  situations where the lender required a second appraisal just before closing. The lender’s concern was, that in the time between the first appraisal and the close of escrow, the market value could have changed. In one instance the lender required a larger deposit and in an other situation the lender backed out of the deal. Apparently certain neighborhoods have been flagged to be in a declining market and lenders are paying attention. More than ever it is important to work with a full time experienced real estate agent who understands the changing market conditions. To protect the buyer one should discuss writing a very long finance contingency into the contract. This might not get the offer accepted but in my opinion it is better to be safe then sorry. Once the buyer removes the contingency and later has to back out of the contract, the deposit will be at risk. In any case buyers need to be informed! 

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