About Inspection Contingency

[Corey Gelineau]

The inspection contingency is used to legally back out of a contract due to the property being in an unacceptable condition upon inspecting the property. Yet, it seems common practice for wholesalers to use this contingency to back out of the contract simply because they have not found a buyer within the inspection period. This appears to be a misuse of said contingency. What are your thoughts on this? And if it is a misuse of the inspection contingency, aren't wholesalers who do this running the risk of being sued and even being forced to purchase the property themselves? 

[Don Konipol]

Quote from @Corey Gelineau:

The inspection contingency is used to legally back out of a contract due to the property being in an unacceptable condition upon inspecting the property. Yet, it seems common practice for wholesalers to use this contingency to back out of the contract simply because they have not found a buyer within the inspection period. This appears to be a misuse of said contingency. What are your thoughts on this? And if it is a misuse of the inspection contingency, aren't wholesalers who do this running the risk of being sued and even being forced to purchase the property themselves? 

Texas residential real estate contracts went away from inspection contingencies many years ago. Instead, there is an option period, with a (mostly) small option fee whereby the buyer can cancel the contract for ANY reason within the option period.  Once the option period is up, cancellation would only be for items specifically named as contingencies, such as financing.