Definition
The contractual deadline by which you must obtain final financing approval or remove the financing contingency. Missing this deadline without valid reason puts your earnest money at risk.
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The financing deadline is critical for both parties. The buyer needs sufficient time to work with their lender to complete underwriting, appraisal, and final approval. The seller needs assurance that the buyer will be ready to close on schedule. Missing this deadline without valid reason can put the buyer's earnest money at risk. It's important to coordinate with your lender to ensure the deadline is realistic.
Pro Tip
Build buffer time with your lender. Work backward from closing to ensure comfortable deadline management.
Example
A purchase contract includes a financing deadline of 21 days after acceptance; the buyer's lender completes underwriting and appraisal by day 18 and issues final approval by day 20, well before the deadline.