A buyer wants to extend the option period from 10 days to 15 days after the original contract has been executed. How should this be accomplished?
Correct Answer
B) The parties must execute a TREC Amendment to modify the option period and negotiate any additional consideration
Extending the option period after the contract is executed requires mutual agreement. The parties must execute a TREC Amendment specifying the new option period end date and any additional consideration (such as an increased option fee).
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Related Concepts
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
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