What Is a Septic, Well, and Water Quality Contingency in Real Estate?

A Septic, Well, and Water Quality Contingency allows buyers to evaluate the property’s private water and waste systems before closing. This contingency is common for rural, off-grid, and non-municipal properties where buyers rely on private wells, septic tanks, or alternative waste systems.

✅ How This Contingency Works

  • The buyer orders septic, well, and/or water quality inspections.
  • Testing must be completed within the contingency period.
  • If results show deficiencies, contamination, or system failure, the buyer may request repairs or credits.
  • If the seller refuses, the buyer may cancel the contract without penalty.
  • Local health department or lender standards often determine acceptable results.

This contingency protects buyers from expensive repairs or unsafe water conditions.

📋 What Buyers Typically Review or Test

  • Well Water Quality Testing (bacteria, nitrates, arsenic, minerals)
  • Flow-Rate Evaluations ensuring adequate water supply
  • Septic Inspection with camera scope, tank pump-out, and drain field evaluation
  • Perc (Percolation) Tests for undeveloped land or septic permits
  • Health Department Records to confirm compliance and permitting
  • Age & Condition of well pump, pressure tank, and septic components

These tests reveal system safety, lifespan, and potential replacement costs.

💡 Why This Contingency Matters

  • Private systems can be expensive—septic replacements can cost $10k–$40k.
  • Well contamination may require treatment or new drilling.
  • Lenders may require passing tests for FHA, VA, or USDA loans.
  • Drain field failures can prevent occupancy approval.
  • Buyers avoid major health and financial risks.

⚠️ Risks & Considerations

  • Some rural areas require seller septic pump-out before transfer.
  • Water contamination may require filtration or reverse-osmosis systems.
  • Low flow rate may indicate pump failure or aquifer issues.
  • Soil conditions may prevent septic approval for new construction.
  • Results may delay closing depending on test availability.