In the Texas real estate contract, specifically the Texas Real Estate Commission (TREC) One to Four Family Residential Contract (Resale), there are multiple contingencies and provisions that allow a buyer to terminate the contract under certain conditions. These provisions are often referred to as "outs" for the buyer. Here are some of the key contingencies and clauses that could potentially allow a buyer to terminate the contract:
Third Party Financing Addendum (Paragraph 2B): If the buyer cannot obtain financing, they can terminate the contract.
Property Approval (Paragraph 2B): If the property does not meet the lender's underwriting requirements, the buyer can terminate the contract.
Seller's Disclosure Notice (Paragraph 7B): If the buyer does not receive the Seller's Disclosure Notice within the specified time frame, they can terminate the contract.
Inspections (Paragraph 7D): The buyer has the right to conduct inspections and can terminate the contract if they are not satisfied with the results, subject to the terms of the agreement.
Environmental Assessments, Threatened or Endangered Species, and Wetlands Addendum: If the property is found to have environmental issues, the buyer can terminate the contract.
Property Condition (Paragraph 7E): If repairs are not completed as agreed, the buyer can terminate the contract.
Lead-Based Paint Addendum: For homes built before 1978, if lead-based paint is found, the buyer can terminate the contract.
Title Commitment and Survey (Paragraph 6C): If there are objections to the title or survey that are not resolved, the buyer can terminate the contract.
Title Policy (Paragraph 6D): If the title company cannot issue a title policy within the time frame specified, the buyer can terminate the contract.
Survey (Paragraph 6C(1)): If the buyer objects to the survey results and the objections are not cured, they can terminate the contract.
Property Approval Period (Third Party Financing Addendum): If the property does not meet the underwriting standards within the specified time, the buyer can terminate.
Approval of HOA Documents (Paragraph 2C of the Addendum for Property Subject to Mandatory Membership in a Property Owners Association): If the buyer does not receive and approve the HOA documents, they can terminate.
Review of Subdivision Information (Paragraph 2A of the Addendum for Property Subject to Mandatory Membership in a Property Owners Association): If the buyer does not receive the subdivision information, they can terminate.
Option Period (Paragraph 23): During the option period, the buyer can terminate the contract for any reason.
Homeowner's Association (HOA) Fees: If the HOA fees are not disclosed or are unacceptable, the buyer can terminate.
FEMA Flood Zone (Paragraph 6C): If the property is in a flood zone and the buyer does not agree to purchase flood insurance, they can terminate.
Utility District Notice (MUD) Addendum: If the property is within a municipal utility district and the buyer objects to the associated disclosures, they can terminate.
Short Sale Addendum: If the short sale is not approved by the lender, the buyer can terminate.
Seller's Temporary Lease (TREC 15-5): If the seller does not vacate the property as agreed, the buyer can terminate.
Condominium Resale Certificate (Paragraph 12): If the buyer does not receive the condominium resale certificate, they can terminate.
Property Not Meeting Specifications (Paragraph 12): If the property does not meet the agreed-upon specifications, the buyer can terminate.
Property Value (Paragraph 12): If the property does not appraise for the purchase price, the buyer can terminate.
Government Regulations (Paragraph 12): If government regulations affect the property negatively, the buyer can terminate.
Zoning Changes (Paragraph 12): If there are unfavorable zoning changes, the buyer can terminate.
Utility Availability (Paragraph 12): If utilities are not available or not up to the buyer's satisfaction, they can terminate.
Inspection Reports: If any inspection reports reveal significant issues, the buyer can terminate.
Structural Issues: If structural issues are discovered and not remedied, the buyer can terminate.
Pest Inspection: If pest inspection reveals problems and they are not addressed, the buyer can terminate.
Mold Inspection: If mold is found and not remediated, the buyer can terminate.
Radon Inspection: If radon levels are found to be unsafe, the buyer can terminate.
Septic System Inspection: If the septic system fails inspection and is not repaired, the buyer can terminate.
Well Water Test: If well water tests are unsatisfactory, the buyer can terminate.
Survey Disputes: If there are disputes regarding the survey and they are not resolved, the buyer can terminate.
Flood History: If the flood history is unacceptable, the buyer can terminate.
Neighborhood Conditions: If neighborhood conditions are found to be unfavorable, the buyer can terminate.
Seller's Disclosure Inaccuracies: If there are inaccuracies in the seller's disclosure that affect the property value or condition, the buyer can terminate.
Easements: If easements affect the property negatively, the buyer can terminate.
Encroachments: If encroachments are found that affect the property's use, the buyer can terminate.
Restrictions: If property restrictions are unacceptable, the buyer can terminate.
Prior Use: If prior use of the property is found to be problematic, the buyer can terminate.
Mineral Rights: If mineral rights issues are unacceptable, the buyer can terminate.
Bankruptcy: If the seller files for bankruptcy, the buyer can terminate.
Unresolved Liens: If there are unresolved liens on the property, the buyer can terminate.
Undisclosed Litigation: If there is undisclosed litigation affecting the property, the buyer can terminate.
These "outs" provide buyers with protections and opportunities to back out of a real estate contract under various circumstances. It is important for buyers to work closely with their real estate agents and legal advisors to fully understand and utilize these contingencies.