What is a Kick Out Clause?

A Kick Out Clause gives a seller or lessor latitude to terminate a tentative agreement if a more favorable prospect arises. Typically included in contingent deals, this clause ensures the current occupant or buyer meets set conditions—like removing financing contingencies—within a specified window. If they fail, the seller can “kick them out,” accepting new offers.

• Contingent Scenarios: Often used where occupant conditions (e.g., pending loan approval) may delay final closing.
• Time-Bound: The occupant must respond swiftly once notified, either waiving contingencies or exiting.
• Owner Safeguard: Minimizes prolonged waiting for incomplete deals while other opportunities arise.
• Balanced Flexibility: Occupants can still finalize if they resolve contingencies rapidly.

Kick Out Clauses preserve the right to proceed with a stronger candidate, reducing the risk of missed transactions or indefinite stalls.