North Dakota Real Estate Practice Exam 2025 – Comprehensive All-in-One Guide for Exam Success!

An inspection contingency is a critical component in a real estate transaction, allowing buyers to conduct various inspections on the property, such as home inspections, pest inspections, and other evaluations. This contingency is designed to protect the buyer by giving them the opportunity to thoroughly assess the condition of the property before proceeding with the purchase.

When a buyer includes an inspection contingency in their offer, they can negotiate repairs with the seller based on the findings of the inspection. If any significant issues are discovered, the buyer can discuss whether the seller will address these concerns prior to closing or adjust the sales price. This not only empowers the buyer to make a more informed decision but also ensures that they are not stuck with unexpected problems after the purchase has been finalized.

The other choices do not accurately capture the purpose of an inspection contingency. While obtaining financing is essential for a purchase, it is a separate process from the inspection. Canceling the transaction without penalties might be a possibility under specific conditions, but it is not the primary function of an inspection contingency. Increasing an offer based on property conditions would contradict the intended use of the inspection, which is usually to negotiate against repairs needed rather than to inflate the offer.