“Kick Out Clause”

Glossary

Definition: A term that refers to a real estate contract contingency that's often used when a home buyer places a house under contract with the understanding that he must sell his current house before finalizing the new purchase.

Sellers holding a contract with a kick out clause continue to market the home. If they receive another offer the buyer has a specific amount of time as stipulated in the clause to remove the contingency and move forward to buy the house, whether his existing house is sold or not. If the buyer cannot move forward, the seller can back out of the original contract and sell to the new buyers.