The Texas option period is a negotiated number of days after your contract goes effective when you can terminate for any reason and get your earnest money back. It’s the most buyer-friendly clause in the TREC contract, and it’s also where more deals go sideways than almost anywhere else — because the clock runs on exact rules that surprise people. Here’s how it starts, how to count the days, and what the option fee actually buys, straight from Paragraph 5 of the contract you’ll sign.
In plain terms: for a negotiated fee, the seller grants you an unrestricted right to walk away — but only until 5:00 p.m. on the last day of the period, and only if the fee was actually paid.
When the option period starts
The clock starts at the Effective Date — the date filled in on the contract when the last party signs and acceptance is communicated back. Paragraph 5B grants the termination right for a stated number of days “after the Effective Date,” which means the Effective Date itself is day zero. If your contract goes effective on Monday, August 3, day one is Tuesday, August 4, and a 7-day option period runs through Monday, August 10.
How to count your Texas option period days
Three counting rules, all straight off the form:
- Every day counts. The Texas option period runs on calendar days — Saturdays, Sundays, and holidays included. A 5-day option that starts effective Tuesday ends on Sunday.
- The deadline does not slide. This is the trap. Paragraph 5A(2) extends the deadline for delivering the option fee when it lands on a weekend or Legal Holiday — but there is no such extension for the termination deadline in 5B. If your last day is Sunday, your deadline is Sunday.
- It ends at 5:00 p.m., not midnight. Notice of termination “must be given by 5:00 p.m. (local time where the Property is located)” on the last day. An email at 7:30 that evening is too late, and Paragraph 5E says time is of the essence — strict compliance, no grace.
Termination itself is a short written notice — TREC publishes a one-page form for it — delivered per the contract’s notice paragraph. When I represent you, the deadline goes on my calendar the day the contract goes effective, and if we’re terminating, the notice goes out with daylight to spare.
What the option fee buys (and where the money goes)
Under Paragraph 5A you deliver the option fee and the earnest money together, to the escrow agent, within 3 days after the Effective Date — one combined payment is fine under the current form. Whatever you deliver is applied first to the option fee, then to earnest money. The escrow agent can release the fee to the seller right away; it’s the seller’s to keep, which is exactly the point — you’re paying real money for a real right. If you terminate during the period, the fee stays with the seller and your earnest money comes back to you. If you close, the fee is credited to the sales price, so in a completed purchase it effectively costs you nothing extra.
The mistake that kills the option
Paragraph 5D is one sentence and it has ended a lot of buyer protections: if no option fee is stated in the contract, or you don’t deliver it on time, you have no unrestricted right to terminate — the rest of the contract stands, but your walk-away window never existed. This is why I confirm the fee cleared the escrow agent’s desk, not just that a check went out.
“As-is” doesn’t cancel your option
Texas buyers agree to take the property “as is” in Paragraph 7D, and some read that as “no inspections, no negotiating.” The form says the opposite: accepting the property as-is doesn’t stop you from inspecting, from negotiating repairs in an amendment, or from terminating during the option period. In practice the option period is exactly when your inspections happen — and the inspection report is the leverage for a repair amendment, negotiated before the clock runs out.
What does “active option contract” mean on a listing?
When you see a Houston-area listing marked “active option contract” on HAR, it means a buyer’s contract has been accepted and that buyer is inside their option period right now. The listing stays visible because the buyer can still walk. If you love the house, this is the status where a backup offer can make sense — and the 2026 back-up addendum now starts your amended timeline when the seller delivers notice that the first contract died, so a well-drafted backup positions you to step straight in. I cover the current contract forms in what the 2026 Texas contract changes mean for buyers.
Keep your deadlines protected
The option period rewards buyers who treat it like the legal instrument it is — fee delivered on time, inspections booked on day one, decision made before 5:00 p.m. with the notice in writing. If you’re buying anywhere in the Houston area, I’ll keep every one of those dates handled so your earnest money stays protected. Call or text me at (281) 500-7077, or read up on the earnest money contract itself and the home-buying process I walk every client through. The promulgated forms live at the Texas Real Estate Commission.
Last updated: August 2026 · Reflects TREC contract 20-19 (mandatory July 1, 2026), Paragraphs 5 and 7D.
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