An option contract is a form of earnest money contract in Texas that gives the buyer the unrestricted right to terminate the contract during a set period of time after signing the real estate contract. The buyer must pay a fee to the seller for the right to terminate the contract. A real estate buyer will normally have their inspections performed during the option period. The buyer will then have the opportunity to negotiate with the seller for any repairs that are needed during the option period.
The option fee and and option period are negotiated between the buyer and seller. A typical option period is 10 days. The typical option fee can range from $100 to $300. If the buyer fails to deliver the option fee to the seller or listing agent within 48 hours of the contract execution date, they will lose the right to terminate the contract under the option clause. For More Information or Ask a Question at our Houston Real Estate Buyer FAQ