a financing contingency is a clause in a home purchase and sale agreement that expresses that your offer is contingent on being able to secure financing for the house. having a financing contingency protects the buyer in the event they are unable to get approved for a loan. a financing contingency can be very specific about stipulations and conditions, but the main goal is to make sure the buyer is not penalized for being unable to get financing and completing the transaction. this is usually in the form of a check and is usually 1 percent to 5 percent of the sale price. when a seller accepts an offer, the earnest money check is held in escrow or sometimes by the title company or real estate agent and is eventually applied to the down payment for the loan. in a hot market, a seller is going to pick the offer that has the highest dollar amount and the fewest contingencies and stipulations.