In a Texas Residential Real Estate agreement, a buyer may choose to have an option period in exchange for an option fee.

An option period is a period of time when a buyer is allowed to terminate a purchase contract for ANY REASON – or no reason at all. A buyer offers the seller a sum of money for this “right terminate for any reason.” The fee, called an Option Fee, is offered at the time the offer is submitted. If accepted, the seller collects the fee. During the Option Period, a buyer can:

  • Hire an Inspector
  • Shop Mortgages
  • Shop Insurance providers
  • Shop Home Protection Plans
  • Tour New Listings
  • and more

An option period can be any number of days for any amount of money, as long as both the buyer and seller agree.

Scenario Example:

$25 a day for a 7-day option period totaling $175 payable to the seller. During the Option Period (the first seven days of the contract), a buyer can have the home inspected. If repairs are recommended, a buyer can submit a repair list to the seller BEFORE the option period expires. If the seller agrees to the repairs, the option period can expire and everyone moves forward towards closing – the option fee can be credited back to the buyer at closing.

If, during the option period, the seller is non-negotiable regarding repairs or any other contingency, a buyer can choose to walk away and terminate the contract. The buyer’s Earnest Money is typically refunded and the seller keeps the $175 option fee.

An option fee is basically paying the seller to take the house off the market so a buyer has time to decide whether or not the home is “the one.”


Q: Who is the Option Fee payable to?

A: The Option Fee should be made payable to the Title Company who will either forward it to the seller or hold it until closing day (seller’s choice). 

Q: Is a check or money order accepted?

A: Usually, yes. A wire transfer is probably the quickest way to meet the deadline. A receipt should be signed and provided for proof of payment.

Q: When will the Option Fee be cashed or deposited?

A: The Option Fee should be delivered to the Title Company within three days after the effective date of the contract. If not delivered by the contract deadline, the option period is not valid.

Q: What happens if I can’t deliver the Option Fee within the 3 days?

A: If the Option Fee is not delivered to the title company within the 3 days from the effective date of the contract, you forfeit the right to terminate the contract for any reason. You will not have an effective Option Period.

Q: What happens to the Option Fee if I cancel the contract during my Option Period?

A: The seller retains the fee for allowing the Option Period.

Q: What happens to the Option Fee if I choose to close on the home?

A: In the earnest money contract, a buyer may request to have the Option Fee credited back to the buyer on closing and funding.

Q: Do I have to give a reason why I’m terminating during the Option Period?

A: Absolutely not! Although your reason can help ease a seller’s curiosity, if you’ve paid for the right to back out for ANY or NO reason, the disclosure is completely up to you.



FB_IMG_1627325327296Val J Aranda, REALTOR® & Certified eXp University Mentor
“Coaching Texas Home Buyers and Sellers since 1998” 

A Wonderful Life Real Estate Group
Brokered by eXp Realty, LLC

Call/Text: 210-378-5987

If you still have questions about the home buying process, I am at your service SEVEN DAYS A WEEK!  I keep my phone on after 5:00 pm to help accommodate your busy work schedule.  I’m “on-call”, even after everyone else clocks out!


STILL HAVE QUESTIONS? Send it on over. I’ll be happy to address your concerns.


Texas law requires all real estate license holders to provide the Information About Brokerage Services to all prospective clients. TREC’s Consumer Protection Notice.

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