{"id":7438,"date":"2026-06-17T02:44:01","date_gmt":"2026-06-16T20:44:01","guid":{"rendered":"https:\/\/lrgrealty.com\/lrg-blog\/?p=7438"},"modified":"2026-10-06T18:52:09","modified_gmt":"2026-10-06T18:52:09","slug":"texas-option-period-explained","status":"publish","type":"post","link":"https:\/\/lrgrealty.com\/lrg-blog\/texas-option-period-explained\/","title":{"rendered":"What Is the Option Period in Texas Real Estate?"},"content":{"rendered":"<div class=\"rl-page rl-page-lrg\">\n<div class=\"rl-wrap\">\n<header class=\"rl-hero\">\n<a class=\"rl-cta-primary\" href=\"\/lrg-blog\/connect-with-lrg\/?ref=texas-option-period-explained\">Connect with LRG &rarr;<\/a><br \/>\n<\/header>\n<p>The option period in Texas is a negotiated number of calendar days after a purchase contract goes effective. The buyer pays an option fee for the unrestricted right to terminate for any reason. The period ends at 5:00 p.m. local property time on the final day.<\/p>\n<p>This guide covers the TREC One to Four Family Residential Contract, Form 20-19, effective July 1, 2026. It does not cover condominiums, new construction, or farm and ranch contracts.<\/p>\n<div class=\"rl-quick-grid\">\n<article class=\"rl-quick-card\">\n<h3>How the Contract Works<\/h3>\n<ul>\n<li><strong>Paragraph 5 of TREC Form 20-19:<\/strong> The current One to Four Family Residential Contract, effective July 1, 2026, covers the termination option in Paragraph 5B. Both the option fee amount and the number of days are negotiated between buyer and seller.<\/li>\n<li><strong>What the fee buys:<\/strong> The seller grants the buyer the unrestricted right to terminate the contract for any reason during the option period. No explanation is required.<\/li>\n<li><strong>Scope of the form:<\/strong> TREC Form 20-19 covers resale transactions for single-family homes, duplexes, triplexes, and fourplexes. Condominiums, new homes sold by a builder, and farm and ranch properties use different TREC forms.<\/li>\n<\/ul>\n<\/article>\n<article class=\"rl-quick-card\">\n<h3>When It Starts and Ends<\/h3>\n<ul>\n<li><strong>Day counting:<\/strong> The first day of the option period starts the day after the Effective Date of the contract. Each day counts as a calendar day, per the TREC FAQ on day counting in a TREC contract.<\/li>\n<li><strong>5:00 p.m. deadline:<\/strong> Termination notice must be given by 5:00 p.m. local time where the property is located, on the last day of the option period, per Paragraph 5B of the contract.<\/li>\n<li><strong>Weekends and holidays count:<\/strong> Calendar days include weekends and holidays. A Friday effective date means Saturday is Day 1.<\/li>\n<\/ul>\n<\/article>\n<article class=\"rl-quick-card\">\n<h3>Option Fee and Earnest Money<\/h3>\n<ul>\n<li><strong>Both go to the Escrow Agent:<\/strong> Under Paragraph 5A of TREC Form 20-19, the buyer delivers both the option fee and earnest money to the Escrow Agent within 3 days after the Effective Date.<\/li>\n<li><strong>Weekend delivery rollover:<\/strong> If the last day for delivery falls on a Saturday, Sunday, or Legal Holiday, the delivery deadline extends to the end of the next day that is not one of those, per Paragraph 5A.<\/li>\n<li><strong>At closing:<\/strong> The option fee is credited to the Sales Price. If the buyer terminates during the option period, the fee is not refunded and the earnest money is returned to the buyer.<\/li>\n<\/ul>\n<\/article>\n<article class=\"rl-quick-card\">\n<h3>Inspections and Access<\/h3>\n<ul>\n<li><strong>Seller must provide access:<\/strong> Paragraph 7A of the contract requires the seller to permit the buyer and buyer&#8217;s agents access to the property at reasonable times for inspections.<\/li>\n<li><strong>Licensed inspectors:<\/strong> The buyer may hire inspectors licensed by TREC or otherwise permitted by law to inspect the property during the option period.<\/li>\n<li><strong>Utilities stay on:<\/strong> The seller must keep existing utilities turned on during the contract period at the seller&#8217;s expense, per Paragraph 7A. Hydrostatic testing requires separate written authorization from the seller.<\/li>\n<\/ul>\n<\/article>\n<\/div>\n<div class=\"rl-atf-faqhead\"><span class=\"rl-kicker\">Asked First<\/span>Questions before you dig in<\/div>\n<details>\n<summary>When does the option period start in Texas?<\/summary>\n<p>The option period starts the day after the Effective Date of the contract. The Effective Date is the date of final acceptance, as labeled on the final page of TREC Form 20-19. Day counting uses calendar days, not business days. If the Effective Date is a Monday, Day 1 of the option period is Tuesday. The deadline to terminate is 5:00 p.m. local property time on the final day of the period.<\/p>\n<\/details>\n<details>\n<summary>What is the difference between the option fee and earnest money?<\/summary>\n<p>Both are delivered to the Escrow Agent under the current TREC resale contract, within 3 days after the Effective Date. The option fee buys the buyer&#8217;s unrestricted right to terminate during the option period. If the buyer terminates within the deadline, the option fee is not refunded and the earnest money is returned. If the sale closes, the option fee is credited to the Sales Price. Both amounts are negotiated between buyer and seller and written into the contract.<\/p>\n<\/details>\n<details>\n<summary>Can a buyer back out during the option period?<\/summary>\n<p>Yes. The buyer can terminate the contract for any reason by giving written notice to the seller by 5:00 p.m. local property time on the final day of the option period. No explanation is required. The TREC Notice of Buyer&#8217;s Termination of Contract, Form 38-8, is the TREC form for this notice. When the buyer terminates within the deadline, the earnest money is refunded. The option fee is not refunded and is released to the seller.<\/p>\n<\/details>\n<section class=\"rl-bluf\">\n<h2 id=\"the-bottom-line-up-front\">The Bottom Line Up Front<\/h2>\n<p><strong>The option period gives a buyer the unrestricted right to terminate a Texas purchase contract for any reason. The buyer and seller agree on the number of days and the option fee amount, and both figures are written into the TREC contract. The buyer delivers the option fee and earnest money to the Escrow Agent within 3 days after the Effective Date. Termination notice must be in writing and delivered by 5:00 p.m. local property time on the final day. After the option period expires, the buyer loses that unrestricted right, and the earnest money may be at risk if the buyer walks away without a valid contractual reason. Use the option period to inspect the property, schedule specialty evaluations, negotiate repairs, and confirm financing and insurance costs. Every deadline runs on calendar days, and weekends and holidays count toward the total.<\/strong><\/p>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"when-does-the-option-period-start-in-texas\">When Does the Option Period Start in Texas<\/h2>\n<p>The TREC FAQ on day counting states that the first day of the period starts the day after the effective date of the contract, and each day is counted as a calendar day. The Effective Date is labeled on the final page of TREC Form 20-19 as the date of final acceptance.<\/p>\n<p>This means the Effective Date itself is Day 0. Day 1 begins the following calendar day. Calendar days include Saturdays, Sundays, and holidays. A 7-day option period after a Friday effective date runs Saturday through the following Friday, with the termination deadline at 5:00 p.m. on that Friday.<\/p>\n<h3>Timeline Examples<\/h3>\n<div class=\"rl-table-scroll\">\n<table class=\"rl-table\">\n<thead>\n<tr>\n<th>Effective Date<\/th>\n<th>Option Days<\/th>\n<th>Day 1<\/th>\n<th>Deadline Day<\/th>\n<th>Termination Due<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Monday<\/td>\n<td>7<\/td>\n<td>Tuesday<\/td>\n<td>Following Monday<\/td>\n<td>5:00 p.m. Monday<\/td>\n<\/tr>\n<tr>\n<td>Thursday<\/td>\n<td>10<\/td>\n<td>Friday<\/td>\n<td>Following Sunday<\/td>\n<td>5:00 p.m. Sunday<\/td>\n<\/tr>\n<tr>\n<td>Wednesday<\/td>\n<td>5<\/td>\n<td>Thursday<\/td>\n<td>Following Monday<\/td>\n<td>5:00 p.m. Monday<\/td>\n<\/tr>\n<tr>\n<td>Friday<\/td>\n<td>7<\/td>\n<td>Saturday<\/td>\n<td>Following Friday<\/td>\n<td>5:00 p.m. Friday<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>The option period deadline does not roll forward when it falls on a weekend or holiday. Only the earnest money and option fee delivery deadline rolls forward under Paragraph 5A of the contract. This distinction matters because the two deadlines follow different rules.<\/p>\n<h3>Delivery Deadline vs Option Period Deadline<\/h3>\n<div class=\"rl-table-scroll\">\n<table class=\"rl-table\">\n<thead>\n<tr>\n<th>Deadline<\/th>\n<th>Rule<\/th>\n<th>Weekend or Holiday Rollover<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Option fee and earnest money delivery<\/td>\n<td>Within 3 days after the Effective Date, delivered to the Escrow Agent<\/td>\n<td>Yes. Extends to the end of the next day that is not a Saturday, Sunday, or Legal Holiday.<\/td>\n<\/tr>\n<tr>\n<td>Option period termination<\/td>\n<td>By 5:00 p.m. local property time on the final day<\/td>\n<td>No. The deadline does not move.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>Paragraph 5E of the TREC contract states that time is of the essence for Paragraph 5 and strict compliance with the time for performance is required.<\/p>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"option-fee-and-earnest-money\">Option Fee and Earnest Money<\/h2>\n<p>Under Paragraph 5A of TREC Form 20-19, the buyer delivers both the option fee and the earnest money to the Escrow Agent within 3 days after the Effective Date. Both must be made payable to the Escrow Agent. They may be paid separately or combined in a single payment.<\/p>\n<div class=\"rl-table-scroll\">\n<table class=\"rl-table\">\n<thead>\n<tr>\n<th>Item<\/th>\n<th>Delivered to<\/th>\n<th>Deadline<\/th>\n<th>If Buyer Terminates During Option Period<\/th>\n<th>At Closing<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Option fee<\/td>\n<td>Escrow Agent<\/td>\n<td>Within 3 days after Effective Date<\/td>\n<td>Not refunded. Escrow Agent releases to Seller.<\/td>\n<td>Credited to Sales Price<\/td>\n<\/tr>\n<tr>\n<td>Earnest money<\/td>\n<td>Escrow Agent<\/td>\n<td>Within 3 days after Effective Date<\/td>\n<td>Refunded to Buyer<\/td>\n<td>Applied at closing<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<div class=\"bullet-section-gray\">\n<ul>\n<li><strong>Application order:<\/strong> When the Escrow Agent receives funds, they are applied first to the option fee, then to the earnest money, and then to any additional earnest money, per Paragraph 5A of the contract.<\/li>\n<li><strong>Escrow Agent releases fee to Seller:<\/strong> Paragraph 5A authorizes the Escrow Agent to release and deliver the option fee to the Seller at any time without further notice to or consent from the Buyer.<\/li>\n<li><strong>Late or missing option fee:<\/strong> Paragraph 5D states that if no dollar amount is stated as the option fee, or if the buyer fails to deliver the option fee within the time required, the buyer does not have the unrestricted right to terminate under Paragraph 5.<\/li>\n<li><strong>Late earnest money:<\/strong> Paragraph 5C states that if the buyer fails to deliver the earnest money within the time required, the seller may terminate the contract or exercise remedies under Paragraph 15 by providing notice to the buyer before the buyer delivers the earnest money.<\/li>\n<\/ul>\n<\/div>\n<p>Both the option fee amount and the earnest money amount are negotiated between buyer and seller. The TREC contract has blank fields for these figures, and no minimum or maximum is set by the form.<\/p>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"how-long-should-your-option-period-be\">How Long Should Your Option Period Be<\/h2>\n<p>The number of option days is negotiated between buyer and seller. The TREC contract has a blank field for this number, and no minimum or maximum is set by the form. The right length depends on the property, the inspection schedule, and how many evaluations the buyer needs before the deadline.<\/p>\n<div class=\"bullet-section-blue\">\n<ul>\n<li><strong>General inspection first:<\/strong> Schedule the home inspection early in the option period so the report arrives before the deadline.<\/li>\n<li><strong>Specialty inspections take time:<\/strong> If the general inspection flags foundation movement, roof damage, or plumbing concerns, a structural engineer, roofer, or plumber needs a separate appointment.<\/li>\n<li><strong>Negotiate with the inspection plan in mind:<\/strong> Before agreeing on a number of option days, confirm that your inspector has availability during the period. An option period that starts late in the week may leave fewer working days for follow-up appointments.<\/li>\n<li><strong>Multiple-offer situations:<\/strong> When several buyers submit offers on the same property, a shorter option period combined with a confirmed inspection appointment may make the offer stand out. Pair it with a prompt option fee delivery so the seller sees commitment early.<\/li>\n<\/ul>\n<\/div>\n<div class=\"rl-table-scroll\">\n<table class=\"rl-table\">\n<thead>\n<tr>\n<th>Buyer Situation<\/th>\n<th>Considerations<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Newer home with a clean seller disclosure and inspector already scheduled<\/td>\n<td>A shorter option period may work if the inspection appointment is confirmed before the contract goes effective.<\/td>\n<\/tr>\n<tr>\n<td>Older home with potential foundation, plumbing, or electrical issues<\/td>\n<td>Allow time for a general inspection, specialty evaluations, and repair estimates before the deadline.<\/td>\n<\/tr>\n<tr>\n<td>Rural property with septic, well, or acreage<\/td>\n<td>Factor septic and well evaluation scheduling into the option period length.<\/td>\n<\/tr>\n<tr>\n<td>Property with a pool<\/td>\n<td>Factor pool evaluation scheduling into the option period length.<\/td>\n<\/tr>\n<tr>\n<td>Out-of-area buyer<\/td>\n<td>Allow time for travel to attend the inspection in person or coordinate remotely with the inspector and agent.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/section>\n<div class=\"rl-cta-mid\"><a class=\"rl-cta-pill\" href=\"\/lrg-blog\/connect-with-lrg\/?ref=texas-option-period-explained\">Connect with LRG &rarr;<\/a><\/div>\n<section class=\"rl-section\">\n<h2 id=\"what-to-do-during-the-option-period\">What to Do During the Option Period<\/h2>\n<p>The option period is the buyer&#8217;s window to inspect the property, gather information, and decide whether to move forward, negotiate, or terminate. Every action should work backward from the 5:00 p.m. deadline on the final day.<\/p>\n<div class=\"bullet-section-green\">\n<ul>\n<li><strong>Schedule the general inspection immediately:<\/strong> Book the inspection before or as soon as the contract goes effective. The report is your baseline for everything that follows.<\/li>\n<li><strong>Order specialty inspections based on the general report:<\/strong> If the inspector flags foundation cracks, roof damage, active pests, or plumbing concerns, schedule a structural engineer, roofer, WDI inspector, or plumber. Each requires a separate appointment.<\/li>\n<li><strong>Get an insurance quote:<\/strong> Request a homeowners insurance quote for the specific property before the option period ends. The premium depends on the home&#8217;s age, roof condition, claims history, and location. Knowing this number before you are locked in prevents a cost surprise after closing.<\/li>\n<li><strong>Review the seller&#8217;s disclosure:<\/strong> Paragraph 7B of the contract addresses the Seller&#8217;s Disclosure Notice under Texas Property Code 5.008. The disclosure requirement has enumerated exemptions, and the contract includes a checkbox when the seller is not required to furnish the notice. Check any disclosure received against the inspection findings. If the seller delivers the notice, the buyer may terminate within 7 days after receiving it or prior to closing, whichever first occurs, per Paragraph 7B.<\/li>\n<li><strong>Negotiate repairs or credits if needed:<\/strong> After reviewing inspection findings, the buyer can request repairs or a seller credit through a written amendment. The seller can accept, counter, or refuse. Paragraph 7D confirms that accepting the property &#8220;as is&#8221; does not prevent the buyer from inspecting, negotiating repairs in a subsequent amendment, or terminating during the option period.<\/li>\n<li><strong>Check title and survey:<\/strong> Under Paragraph 6B, the seller furnishes a commitment for title insurance and copies of documents evidencing exceptions. Review these during the option period if possible. Title objections are covered separately under Paragraph 6D, which has its own timeline and conditions.<\/li>\n<\/ul>\n<\/div>\n<p>For a detailed inspection checklist and San Antonio-area concerns including foundation, drainage, and pest issues, see the <a href=\"\/lrg-blog\/home-inspection-san-antonio-guide\/\">San Antonio home inspection guide<\/a>.<\/p>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"how-to-terminate-during-the-option-period\">How to Terminate During the Option Period<\/h2>\n<p>To exercise the unrestricted right to terminate, the buyer must deliver written notice to the seller by 5:00 p.m. local property time on the final day of the option period. Paragraph 5B of the TREC contract controls this right. Paragraph 21 specifies the acceptable notice methods.<\/p>\n<div class=\"bullet-section-beige\">\n<ul>\n<li><strong>Use TREC Form 38-8:<\/strong> The Notice of Buyer&#8217;s Termination of Contract is the TREC form for termination notice. Have your agent prepare it as soon as the decision is made.<\/li>\n<li><strong>Deliver through a Paragraph 21 method:<\/strong> Paragraph 21 states that all notices must be in writing. Notices are effective when mailed, hand-delivered, sent by overnight courier, or transmitted by electronic transmission to the other party or their agent.<\/li>\n<li><strong>Time is of the essence:<\/strong> Paragraph 5E states that time is of the essence for Paragraph 5 and strict compliance with the time for performance is required. The termination deadline is 5:00 p.m. on the final day.<\/li>\n<li><strong>Earnest money release after termination:<\/strong> Under Paragraph 18C, upon termination, either party or the Escrow Agent may send a release of earnest money. The parties execute counterparts of the release and deliver them to the Escrow Agent. If only one party makes written demand and the Escrow Agent does not receive written objection within 15 days, the Escrow Agent may disburse the earnest money to the party making demand, reduced by unpaid expenses incurred on behalf of that party.<\/li>\n<\/ul>\n<\/div>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"what-happens-when-the-option-period-expires\">What Happens When the Option Period Expires<\/h2>\n<p>Once the option period deadline passes, the buyer loses the unrestricted right to terminate. The contract continues, and the buyer&#8217;s remaining termination rights depend on specific contract provisions and their conditions.<\/p>\n<div class=\"bullet-section-gray\">\n<ul>\n<li><strong>Earnest money exposure changes:<\/strong> During the option period, a buyer who terminates keeps the earnest money and loses only the option fee. After the option period, terminating without a valid contractual reason may put the earnest money at risk. Under Paragraph 15 of the contract, the seller may terminate and receive the earnest money as liquidated damages if the buyer defaults.<\/li>\n<li><strong>Remaining contract rights:<\/strong> The option period expiration removes the unrestricted right, not every possible exit. The contract may still contain rights related to title objections under Paragraph 6D, the seller&#8217;s disclosure under Paragraph 7B, and casualty loss under Paragraph 14. Each has its own conditions and deadlines.<\/li>\n<li><strong>Backup offers:<\/strong> Under Paragraph 19, the seller may continue to show the property and receive, negotiate, and accept backup offers.<\/li>\n<li><strong>Repair negotiations:<\/strong> During the option period, the buyer retains the unrestricted right to terminate or to negotiate repairs through a written amendment. Paragraph 7D confirms that accepting the property as is does not prevent the buyer from negotiating repairs in a subsequent amendment or from terminating during the option period.<\/li>\n<\/ul>\n<\/div>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"can-you-extend-the-option-period-in-texas\">Can You Extend the Option Period in Texas<\/h2>\n<p>Paragraph 22 states that the contract cannot be changed except by the written agreement of the parties. An extension to the option period requires a written amendment signed by both buyer and seller.<\/p>\n<div class=\"bullet-section-blue\">\n<ul>\n<li><strong>Both parties must agree:<\/strong> The seller is not required to grant an extension. Extension is a negotiation, and the seller may ask for additional consideration in exchange for extending the deadline.<\/li>\n<li><strong>Sign before the deadline:<\/strong> An amendment extending the option period should be signed before the original period expires. If the original deadline passes without a signed extension, the unrestricted termination right is gone regardless of whether negotiations are in progress.<\/li>\n<li><strong>Common reasons for an extension request:<\/strong> Inspection delays, inspector availability, waiting for a specialty evaluation, incomplete repair estimates, or utility access issues that prevented a full inspection.<\/li>\n<li><strong>Seller considerations:<\/strong> Granting an extension keeps the property tied up and delays the seller&#8217;s ability to move forward with backup offers. The seller weighs the cost of delay against the risk of the deal falling through.<\/li>\n<\/ul>\n<\/div>\n<\/section>\n<section class=\"rl-faq\">\n<h2 id=\"frequently-asked-questions\">Frequently Asked Questions<\/h2>\n<details>\n<summary>Does the option period include weekends and holidays?<\/summary>\n<p>Yes. The option period counts calendar days, not business days. Weekends and holidays are included in the total. A 7-day option period that starts the day after a Friday effective date runs Saturday through Friday. The termination deadline is 5:00 p.m. local property time on the final day regardless of whether that day falls on a weekend or holiday.<\/p>\n<\/details>\n<details>\n<summary>What happens if the option fee is not delivered on time?<\/summary>\n<p>Paragraph 5D of the TREC contract states that if no dollar amount is stated as the option fee, or if the buyer fails to deliver the option fee within the time required, the buyer does not have the unrestricted right to terminate under Paragraph 5. The option period may still exist in the contract, but the termination right is not enforceable without timely delivery of the fee.<\/p>\n<\/details>\n<details>\n<summary>Can the seller back out during the option period?<\/summary>\n<p>Paragraph 5B grants the unrestricted right to terminate to the buyer, not the seller. If the buyer defaults, the seller&#8217;s remedies are under Paragraph 15, which allows the seller to enforce specific performance or terminate and receive the earnest money as liquidated damages. Under Paragraph 19, the seller may continue to show the property and receive, negotiate, and accept backup offers.<\/p>\n<\/details>\n<details>\n<summary>What is a 10-day option period in real estate?<\/summary>\n<p>A 10-day option period is a negotiated term written into the TREC contract. The buyer has 10 calendar days after the Effective Date to terminate for any reason. This length allows time for a general home inspection, one or two specialty evaluations, repair estimates, and a decision before the deadline. The right number of days depends on the property, the inspection schedule, and the buyer&#8217;s circumstances.<\/p>\n<\/details>\n<details>\n<summary>Can a buyer communicate directly with the seller during the option period?<\/summary>\n<p>Paragraph 21 of the contract states that all notices from one party or their agent to the other must be in writing. Notices are effective when mailed, hand-delivered, sent by overnight courier, or transmitted by electronic transmission to the other party or their agent.<\/p>\n<\/details>\n<details>\n<summary>What does as is mean during the option period?<\/summary>\n<p>Accepting the property &#8220;as is&#8221; under Paragraph 7D of the TREC contract means the buyer accepts the present condition with all defects and without warranty except for title warranties. Paragraph 7D explicitly states that accepting the property as is does not prevent the buyer from inspecting the property, negotiating repairs in a subsequent amendment, or terminating during the option period.<\/p>\n<\/details>\n<details>\n<summary>Does the option fee delivery deadline change if it falls on a weekend?<\/summary>\n<p>Yes. Paragraph 5A of the TREC contract states that if the last day to deliver the option fee falls on a Saturday, Sunday, or Legal Holiday, the delivery deadline extends to the end of the next day that is not one of those. This rollover applies only to the delivery deadline, not to the option period termination deadline. The option period ends at 5:00 p.m. on the final day regardless of whether that day is a weekend or holiday.<\/p>\n<\/details>\n<details>\n<summary>What TREC form do I use to terminate during the option period?<\/summary>\n<p>Use the TREC Notice of Buyer&#8217;s Termination of Contract, Form 38-8. This form notifies the seller that the buyer is terminating the contract. Deliver it using one of the notice methods in Paragraph 21 of the contract: mail, hand delivery, overnight courier, or electronic transmission to the other party or their agent.<\/p>\n<\/details>\n<details>\n<summary>Should I waive the option period?<\/summary>\n<p>Without an option period, the buyer does not have the unrestricted right to terminate under Paragraph 5B. Under Paragraph 15, if the buyer fails to comply with the contract, the seller may terminate and receive the earnest money as liquidated damages. Other contract provisions may provide termination rights with specific conditions and deadlines.<\/p>\n<\/details>\n<details>\n<summary>Does the option period apply to condos or new construction?<\/summary>\n<p>TREC Form 20-19 is for resale transactions involving single-family homes, duplexes, triplexes, and fourplexes. It is not for condominium transactions, new homes sold by a builder, or farm and ranch properties. Those transactions use different TREC forms with their own provisions for due diligence and termination. Check the specific form that applies to your transaction type.<\/p>\n<\/details>\n<\/section>\n<section class=\"rl-section\">\n<h2 id=\"data-and-methodology\">Data and Methodology<\/h2>\n<p>Contract mechanics in this guide are drawn from the TREC One to Four Family Residential Contract, Form 20-19, effective July 1, 2026. Day-counting rules are from the TREC FAQ on how days are counted in a TREC contract. The termination form referenced is TREC Notice of Buyer&#8217;s Termination of Contract, Form 38-8, effective April 1, 2025. Seller&#8217;s disclosure provisions reference Texas Property Code 5.008, which has enumerated exemptions noted in Paragraph 7B of the contract. This guide covers the resale contract only and does not cover condominium, new-construction, or farm-and-ranch transactions. This guide is not legal advice. TREC forms are intended for use by trained real estate license holders, and the contract itself advises parties to consult an attorney before signing.<\/p>\n<\/section>\n<footer class=\"rl-resources\">\n<h2 id=\"resources-used\">Resources Used<\/h2>\n<ul>\n<li><a href=\"https:\/\/www.trec.texas.gov\/sites\/default\/files\/pdf-forms\/20-19_4.pdf\" rel=\"noopener noreferrer\" target=\"_blank\">TREC One to Four Family Residential Contract, Form 20-19, effective July 1, 2026<\/a><\/li>\n<li><a href=\"https:\/\/www.trec.texas.gov\/how-are-days-counted-trec-contract\" rel=\"noopener noreferrer\" target=\"_blank\">TREC FAQ: How are days counted in a TREC contract<\/a><\/li>\n<li><a href=\"https:\/\/www.trec.texas.gov\/forms\/notice-buyers-termination-contract\" rel=\"noopener noreferrer\" target=\"_blank\">TREC Notice of Buyer&#8217;s Termination of Contract, Form 38-8, effective April 1, 2025<\/a><\/li>\n<li><a href=\"https:\/\/www.trec.texas.gov\/forms\/one-four-family-residential-contract-resale\" rel=\"noopener noreferrer\" target=\"_blank\">TREC Forms: One to Four Family Residential Contract, Resale<\/a><\/li>\n<li><a href=\"https:\/\/statutes.capitol.texas.gov\/Docs\/PR\/htm\/PR.5.htm\" rel=\"noopener noreferrer\" target=\"_blank\">Texas Property Code 5.008, Seller&#8217;s Disclosure Notice<\/a><\/li>\n<li><a href=\"https:\/\/statutes.capitol.texas.gov\/Docs\/GV\/htm\/GV.662.htm\" rel=\"noopener noreferrer\" target=\"_blank\">Texas Government Code 662.003, Legal Holidays<\/a><\/li>\n<\/ul>\n<\/footer>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Connect with LRG &rarr; The option period in Texas is a negotiated number of calendar days after a purchase contract goes effective. The buyer pays an option fee for the unrestricted right to terminate for any reason. The period ends at 5:00 p.m. local property time on the final day. This guide covers the TREC [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":7455,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":["post-7438","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-home-buying"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Texas Option Period Explained: Rules, Fees, Timeline (2026)<\/title>\n<meta name=\"description\" content=\"How the Texas option period works: the fee, the timeline, and how buyers use it to negotiate repairs or walk away. 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