You don't say what sort of contact type you're using or what solution sequence, but I'll assume you're using touching contact in SOL101.
Remember that the contact algorithm for touching contact is fully nonlinear. Including nonlinearity in the model means that displacement does not necessarily equal force over stiffness any longer. Since that's the basis of the epsilon check, it therefore doesn't make sense to have the check when there's nonlinearity.
Similarly, when the touching contact converges it's possible for additional forces or moments to be introduced, so some mismatch between applied load and constraint forces does not necessarily indicate a problem.
Yes you assumed it correct. I am using touching contact with SOL 101. Few follow up questions
1) Since you mentioned that touching contact is fully nonlinear. However, I have not defined any non-linear material information. Can I still trust the result? Can you provide me some link on how this non-linearity for contact is solved.
2) In terms of equilibrium checks, since now the applied force is not equal to SPC force, what other factors I can take for model checks.
Only the touching contact itself is nonlinear. All other assumptions for linear static analysis still hold: small displacement, linear materials, etc. Touching contact in SOL101 uses the same algorithm as used in SOL400. You can find more information on this in the Nastran documentation: MSC Nastran Nonlinear (SOL400) User's Guide
As long as the mismatch in your equilibrium check is small (as it is here), you should be OK. You've already run the model without contact, so you know it's OK for equilibrium and the differences are purely due to the contact.