How Contingencies Work in San Francisco Offers

Thinking about making an offer in Cow Hollow but unsure how contingencies fit in? You are not alone. In San Francisco, contingencies can help you protect your interests while still writing a competitive offer in a fast market. In this guide, you will learn how each contingency works, what timelines to expect, where buyers and sellers take on risk, and practical ways to negotiate without overexposing yourself. Let’s dive in.

Contingencies, defined

A contingency is a contract condition that must be satisfied or waived for the sale to move forward. Common examples include inspection, appraisal, and loan approval. These protections are written into the purchase contract with specific deadlines and clear instructions for removal in writing.

In California, most offers use standard forms that include contingency options and timelines. Seller disclosure duties exist alongside these protections. Disclosures do not replace your contingency rights, and contingencies do not replace required disclosures.

How they work in California

Contingencies live and die by the written contract. The deadlines and removal instructions in your agreement control the outcome. Verbal assurances do not override the signed terms.

If a contingency is removed, you generally lose that specific right to cancel. If you cancel after the window closes without a contractual basis, you risk your deposit. If you cancel within the contingency period and follow the contract, deposits are typically returned per the terms.

The big three contingencies

Inspection or investigations

The inspection contingency lets you review the property, disclosures, and any related reports. You can hire inspectors, review permits, and evaluate systems like roof, plumbing, and HVAC. For condos and TIC-like structures, you also review HOA documents.

Typical windows in San Francisco can be short due to competition, often 7 to 17 days, though you can negotiate longer. If you find issues within the period, you can request repairs, negotiate a credit, or cancel. If you remove the contingency, you accept the property’s condition subject to the contract.

Strategy notes:

• Waiving inspection can improve competitiveness but raises the risk of undiscovered defects.
• An as-is offer usually still allows inspections unless otherwise stated. Sellers must still provide required disclosures.
• If repairs are essential, consider asking for a credit at closing or an escrow holdback rather than a last-minute contractor rush.

Appraisal

The appraisal contingency protects you if the lender’s appraisal comes in below the purchase price. You can typically renegotiate, bring in more cash, or cancel if allowed by the contract.

In high-demand pockets like Cow Hollow, some buyers waive the appraisal contingency to strengthen the offer. If you do, and the appraisal is low, your lender will likely base the loan on the appraised value. You must make up the difference in cash or risk loan denial.

Strategy notes:

• Consider an appraisal gap provision that commits a set amount you will cover if the appraisal is short, instead of a full waiver.
• Keep your lender engaged early so the appraisal is ordered quickly.

Loan or financing

The loan contingency gives you time to secure final approval. Typical underwriting windows are 21 to 30 days, though timelines vary by lender and loan type.

Shortening or waiving the loan contingency increases risk. If your loan falls through after removal, you could lose your deposit. Strong pre-approval and clear proof of funds help build seller confidence without taking on unnecessary exposure.

Title and HOA review

A title contingency allows you to review the preliminary title report for liens, easements, or restrictions. For condos and many multi-unit properties, the HOA review is equally important. You will look at CC&Rs, bylaws, budgets, reserves, and meeting minutes to understand rules and financial health.

If the HOA is underfunded or the title report surfaces issues you cannot accept, your contingency period is the time to object or cancel under the contract.

Other useful contingencies

• Sale of buyer’s property. This can help if you need to sell before you buy. In San Francisco, sellers often resist this unless the buyer provides strong evidence of ability to close quickly.
• Insurance. Lenders require hazard insurance, and earthquake coverage is separate and more complex. If insurability is in doubt, consider addressing this during contingency periods.
• Environmental or specialized inspections. Natural hazard disclosures, and inspections for items like mold or asbestos in older homes, can be part of your investigations.
• Government approvals or permits. If unpermitted work is disclosed, you may wish to build in time to evaluate permit history or feasibility.

Cow Hollow and SF norms

Cow Hollow is a high-demand neighborhood with many condos, TICs, and single-family homes. When competition is strong, sellers may prioritize offers that limit or waive contingencies, especially inspection, appraisal, and financing. Buyers sometimes trade safety for speed and certainty.

Market conditions change. In a slower cycle, sellers may be more flexible on timelines and contingencies. Tailor your approach to current conditions and the specific property.

Timelines, escrow, and deposits

• Escrow length. Many San Francisco escrows run 21 to 30 days, but you can negotiate shorter or longer timelines depending on financing and seller needs.
• Earnest money. Buyers often offer 1 to 3 percent of the purchase price. Larger deposits are sometimes used to signal seriousness, especially if contingencies are shortened or waived.
• Forfeiture risk. If you cancel after contingency windows close and without contractual rights, the seller may be able to keep your deposit and may have other remedies. If you cancel properly within a contingency period, deposits are typically returned according to the contract.

Buyer strategies that work

• Lead with the must-haves. For most buyers, inspection and financing are the core protections. Keep them unless you have done enough due diligence and planning to narrow the risk.
• Tighten, do not sever. Shorten contingency periods when competitive, but keep them realistic so you can complete inspections and underwriting on time.
• Use an appraisal gap. Commit to cover a defined shortfall instead of a full appraisal waiver, which preserves some protection while helping your offer compete.
• Prepare early. Secure a strong pre-approval and line up inspectors before you write. Fast scheduling helps you meet shorter deadlines.
• Follow the paper trail. Track every deadline and deliver removal or termination in writing as the contract requires.

Seller strategies to evaluate risk

• Verify buyer strength. Ask for a current pre-approval, proof of funds, and a meaningful earnest money deposit.
• Choose certainty wisely. Waived contingencies can create speed and certainty, but weigh the risk if the buyer struggles later in escrow.
• Disclose completely. California sellers must provide statutory disclosures and known material facts. Proper disclosure reduces the chance of disputes, even if the buyer limited inspections.
• Set clear expectations. Offer deadlines, preferred timelines, and instructions for access help buyers structure strong, clean offers you can accept with confidence.

Tenant, condo, and local considerations

If a San Francisco property is tenant occupied, local rent and tenant protections apply and should be disclosed. For condos and HOAs, thorough document review is part of prudent investigations. These local factors affect timelines and may influence which contingencies you keep.

Document and deadline checklist

Use this quick list to stay organized during your contingency periods:

• Inspection reports, including pest and roof
• Seller disclosures and any available permits
• Preliminary title report review
• HOA documents for condos or common interest properties
• Lender commitment and loan conditions
• Appraisal results and any appraisal gap plan
• Proof of hazard insurance availability, and earthquake coverage options
• Written notices for contingency removal or termination before each deadline

Avoiding disputes

Most disputes come from missed deadlines, unclear communication, or incomplete disclosures. Keep every step in writing and on schedule. If an issue arises, address it within the contingency period, and use the contract’s notice procedures.

If a material problem surfaces after contingencies are removed, your options are limited by the contract. On the other hand, if a seller fails to disclose known defects, remedies may still exist under California law. The best protection is disciplined process and complete documentation.

Final thoughts

Contingencies are the guardrails that keep your purchase or sale on track. In Cow Hollow, the right balance of protection and competitiveness can make the difference between winning a home and keeping your peace of mind. Work with a team that understands San Francisco forms, timelines, and neighborhood dynamics so you can move with confidence from offer to close.

Ready to tailor a plan for your Cow Hollow move? Connect with the local experts at Sage Real Estate for a calm, clear path through contingencies and closing.

FAQs

What is a contingency in San Francisco offers?

• A contingency is a contract condition that must be met or waived for the sale to proceed, such as inspection, appraisal, or loan approval, with deadlines set in the contract.

How long are inspection and loan timelines?

• Inspection periods in competitive San Francisco deals often run 7 to 17 days, and loan approval is commonly 21 to 30 days, though all timelines are negotiable.

Can I still inspect with an as-is offer?

• Yes. As-is typically means the seller will not make repairs, but you can still conduct inspections and review disclosures unless the contract states otherwise.

What if the appraisal is low in Cow Hollow?

• If you have an appraisal contingency, you can renegotiate, bring extra cash, or cancel under the contract. If you waived it, you may need to cover the shortfall in cash.

What happens if I miss a contingency deadline?

• The written contract controls. Missing a deadline can put your deposit at risk or allow the seller to issue a default notice, so act quickly and follow the notice rules in writing.

Are sellers required to accept offers with contingencies?

• No. Sellers can choose any offer. In hot markets, sellers often favor offers with shorter or fewer contingencies.

What should sellers do to reduce risk?

• Provide complete disclosures, verify buyer qualifications, and set clear timelines. Proper disclosure reduces disputes even when buyers limit contingencies.