The option period in a Texas residential contract:
Question & Answer
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Is required by law
The option period is not required by Texas law; it is an optional contractual provision that parties may choose to include or exclude from their agreement, making it a negotiated term rather than a statutory mandate.
Gives the buyer time to terminate for any reason
Cannot exceed 7 days
Texas law and TREC contracts do not impose any maximum duration on the option period; the length is entirely negotiable, and in practice option periods commonly range from 5 to 10 days or more depending on market conditions and buyer needs.
Is free to the buyer
The option period is not free to the buyer; the buyer must pay an option fee — typically ranging from $100 to several hundred dollars or more depending on negotiations — directly to the seller as consideration for the unrestricted termination right.
Why is this correct?
Under the Texas Real Estate Commission (TREC) One to Four Family Residential Contract, Paragraph 23 establishes the unrestricted right to terminate, commonly called the 'option period,' which the buyer purchases by paying an agreed-upon option fee directly to the seller. The buyer may terminate for any reason — or no reason at all — before the option period expires, and the only money at risk during this window is the option fee itself, not the earnest money. The option period length and fee are fully negotiable between the parties and are not mandated by Texas law or TREC rules.
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