Financing and closing

Earnest Money and Land Feasibility Contingencies

A land contract should give the buyer enough time and practical access to investigate the parcel’s actual risks.

What this due-diligence check covers

The exact language is a legal matter, but the decision framework is operational: list every high-impact unknown, the evidence needed and the deadline for approval or termination.

Coordinate deposits, option fees and inspection rights with local practice.

Why it matters before closing

Land studies can require agency responses, field access and contractors whose schedules do not fit a short generic inspection period.

What to verify

  • Create a due-diligence schedule before signing.
  • Confirm rights to enter for surveys and tests.
  • Define acceptable results and termination procedure.
  • Track notice methods and time zones exactly.

Red flags that deserve follow-up

  • Deadline shorter than perc or survey lead time.
  • Nonrefundable deposit before title documents arrive.
  • No right to disturb soil or clear access for testing.
  • Approval contingency tied only to financing, not buildability.

Evidence to keep in the parcel file

  • Signed contract and addenda
  • Deadline calendar
  • Access permissions
  • Written approval or termination record

Questions to ask before the deadline

  1. When does money become nonrefundable?
  2. Can professionals enter and perform tests?
  3. What happens if access or septic fails?
  4. How must termination notice be delivered?
  5. Can deadlines extend for agency delay?

Primary-source starting points

Open the records behind the research.

These sources support screening and process planning. Parcel-specific decisions may still require local authorities and qualified professionals.

Put the guide to work

Turn the guide into a parcel-specific due-diligence list.

Frequently asked

Questions land buyers ask

What is earnest money?

It is a deposit showing contractual commitment, handled and refundable according to the agreement and applicable law.

Is a due-diligence contingency automatic?

No. The contract must be reviewed for the actual rights, deadlines and procedures.

Can I test land before owning it?

Only with the seller’s permission and appropriate terms, insurance and restoration responsibilities.