You found a home you love in Lakewood, but the word “option” on the Texas contract stopped you cold. You are not alone. The Texas option period can feel technical, yet it is one of the most buyer-friendly tools you have. In this guide, you will learn exactly how the option period works, how much time and money to expect, and how to use it to protect your purchase in Lakewood. Let’s dive in.
What the option period is
The option period is a short, negotiated window in the standard Texas residential purchase contract that gives you an unrestricted right to terminate for any reason. Your right starts once the contract is executed and you pay the agreed option fee to the seller. It exists because the TREC contract provides for it and both parties choose the terms.
During this time, you can inspect, review documents, gather estimates, and decide whether to move forward. If you terminate within this window using the contract’s notice process, your earnest money is typically returned per the contract, while the seller keeps the option fee.
It is important to know the option period is separate from financing, appraisal, and other deadlines. Those can run at the same time but have their own rules. If the option period expires, your unrestricted right to cancel goes away, though other contract contingencies may still apply.
How the clock and money work
You and the seller negotiate two items in the contract: the number of option days and the option fee amount. The option period usually begins when both parties sign the contract and it becomes fully executed.
Option fees are paid by you to the seller as consideration for the termination right. Local handling can vary. Some transactions deliver the fee to the seller, some to the listing broker, and some to the title company. Ask your agent and title company what is standard for your deal and follow the contract’s delivery method.
Common practice in Texas sets option periods around 3 to 10 days, with 7 days as a frequent balance between speed and due diligence. In a competitive market, buyers may shorten or even waive the option period to stand out. With older Lakewood homes or when you need specialist inspections, 7 to 14 days can be more practical.
Option fee amounts are negotiable. In many Texas markets, typical ranges often fall near 100 to 500 dollars, though hot listings may push buyers to adjust. If you terminate during the option period, the seller usually keeps the fee, and your earnest money typically returns to you. If you close, the fee is often credited to you at closing, depending on your contract.
Notices and deadlines
Your termination notice must be in writing and delivered before the option period expires. The contract and TREC forms outline the acceptable delivery methods and any time-of-day cutoff on the final day. Timing matters. Missing the deadline generally ends your unrestricted termination right under the option clause.
Use the days wisely
The option period is your chance to look under the hood. Schedule inspections immediately after contract acceptance so you have time for follow-ups and quotes. A typical plan includes a general home inspection and any specialized evaluations the property may need.
- General home inspection of structure, roof, HVAC, electrical, and plumbing
- Foundation evaluation, common in Dallas due to expansive soils
- Termite and wood-destroying insect inspection
- Sewer scope to assess older lines
- Roof inspection or certification
- HVAC and chimney checks when applicable
- Lead-based paint or asbestos testing for older homes
- Review seller disclosures, surveys, title exceptions, and any HOA documents
Keep written records of all reports and communications. If you need repairs, use the appropriate TREC amendment forms so agreements are clear and enforceable.
Lakewood inspection priorities
Lakewood has many mid-century and historic homes, large mature trees, and proximity to White Rock Lake. These features are part of the charm, but they add unique due diligence needs.
- Foundation evaluation and repair estimates
- Sewer scope for cast-iron or clay lines common in older homes
- Roof age and water-intrusion risks, especially near heavy tree cover
- Electrical and plumbing updates versus original systems
- Any HOA or neighborhood rules and preservation guidelines that affect projects
Negotiation moves
Your inspection findings are leverage. You can request seller repairs, seek a credit at closing, renegotiate price, or decide to terminate. Sellers can accept, reject, or counter. If no agreement is reached, you can cancel within the option period and recover your earnest money, while the seller keeps the option fee.
Offer strategy in Lakewood
Every home and market moment is different. If a Lakewood listing is highly competitive with multiple offers, you might shorten the option period and increase the fee to strengthen your position. This raises your risk because you have less time to discover issues.
If the property is older or has visible complexity, a standard 7-day option period or slightly longer can be smarter. It gives you time for a foundation opinion, a sewer scope, and contractor bids. Balance your due diligence needs with the seller’s preference for speed.
A practical weeklong timeline
Use this sample 7-day schedule as a guide. Adjust based on inspector availability and the home’s age and condition.
- Day 0: Contract executed. Deliver option fee and earnest money per contract. Book general and specialty inspections.
- Day 1-2: General home inspection. Review seller disclosures and title items. Order any quick follow-up inspections.
- Day 2-4: Foundation evaluation, sewer scope, roof check, and any other specialist visits. Request preliminary repair bids.
- Day 4-5: Gather written estimates. Prioritize safety, structure, and water-related items.
- Day 5-6: Draft your repair request or credit proposal using the TREC amendment. Negotiate with the seller.
- Day 7: Decide. If acceptable, finalize the amendment. If not, deliver written termination before the deadline.
Mistakes to avoid
- Waiting to schedule inspections and then running out of time
- Choosing a short option period for an older home that needs multiple specialists
- Missing the written notice deadline or using the wrong delivery method
- Assuming the option fee is refundable if you terminate
- Forgetting to allow time for contractor bids
- Ignoring HOA rules, floodplain notes, or unpermitted work concerns
Buyer checklist
Use this quick list to stay organized from offer to decision.
- Confirm option length that fits the property and market
- Agree on a realistic option fee and delivery method
- Book general inspector and needed specialists on day one
- Ask your agent to confirm the exact termination cutoff date and time
- Coordinate with your lender so timelines align
- Collect all reports and bids in writing
- Draft repair or credit requests using the proper forms
- Deliver any termination notice in writing before the deadline, per contract
Who to involve
- Licensed home inspector with local experience
- Foundation company or structural engineer if concerns arise
- Sewer-scope specialist for older lines
- Roof, HVAC, and chimney professionals as needed
- Your title company to confirm handling of option fees and earnest money
- An experienced local agent to manage deadlines, notices, and negotiation
Bottom line for Lakewood buyers
The Texas option period is your built-in safety net. When you use it well, you gain clarity on a home’s condition, time to price repairs, and leverage to negotiate. In Lakewood’s older and character-rich homes, that window can make the difference between a confident purchase and regrettable surprises.
If you want steady, neighborhood-level guidance on structuring a smart option period and managing inspections with precision, connect with Debbie Ingram to request a private consultation.
FAQs
In Dallas contracts, is the option period required?
- No. It is a negotiated provision in the Texas contract that both parties choose to include and define.
How long should my option period be in Lakewood?
- Common practice is 3 to 10 days, with 7 days often a balance. For older Lakewood homes, consider 7 to 14 days to allow specialist inspections.
What happens to my option fee if I terminate?
- If you cancel during the option period, the seller usually keeps the option fee, and your earnest money is typically returned per the contract.
Can a seller refuse repairs during the option period?
- Yes. Sellers can accept, reject, or counter. If you cannot agree, you may terminate within the option period and recover your earnest money.
Who holds the option fee in Dallas transactions?
- Local practice varies. It may be delivered to the seller, listing broker, or title company. Confirm the method and timing with your agent and title company.
Can I extend my option period in Texas?
- Yes, if the seller agrees. Both parties must sign an amendment that extends the deadline and may adjust fees.
What if I miss the option deadline in Texas?
- Your unrestricted termination right generally ends. Other contract contingencies may still apply, so contact your agent immediately to review your options.
