Kick-Out Clause — Seller’s Option When a Buyer Has a Home-Sale Contingency

Question

What’s a kick-out clause?

Answer

Intro: A kick-out clause is a contract provision sellers use when a buyer’s offer contains a contingency—most often a home-sale contingency or a financing contingency. The clause lets the seller keep marketing the property and accept a stronger offer, while giving the original buyer a short window to remove their contingency or step aside.

Main details: In practice, a seller who accepts an offer with a kick-out clause may later receive a backup offer. The seller serves the original buyer a “notice to perform” (sometimes called a kick-out notice). The buyer then typically has a limited period—commonly 24 to 72 hours—to either (1) remove the contingency (prove they can close) or (2) decline, allowing the seller to terminate the original contract and proceed with the backup buyer. Exact timelines and required proof depend on the contract language and state law.

Key points to watch:

Which contingency is covered: Most kick-outs target home-sale contingencies, but parties can apply them to financing or appraisal contingencies.
Proof required: Sellers often demand written evidence (pre-approval, proof of funds, executed sales contract on the buyer’s home) before the contingency counts as removed.
Response window: The contract should state the exact hours or days and how notice must be delivered (email, certified mail, personal delivery).
Risk for buyers: A short deadline can force rushed decisions—waiving a contingency too early exposes a buyer to financial risk.
Options for sellers: A kick-out preserves sales momentum and reduces the chance of long delays or a sale falling through.

Final paragraph: A well-drafted kick-out clause balances seller flexibility with buyer protections by specifying timelines, acceptable proof, and delivery methods. Because wording and local rules vary, it’s advisable to review the proposed clause with your real estate agent and consult a licensed attorney before signing or issuing a kick-out notice. This helps avoid misunderstandings and preserves your contractual rights.