Option period
A Texas contract feature where the buyer pays the seller a small fee for a set number of days to cancel for any reason. Other states use inspection or due diligence periods instead.
Also called: option fee, termination option, option money
Related terms
A contract term that gives the buyer time to inspect the property and then cancel, ask for repairs or renegotiate based on what is found. Waiving it means accepting the home's condition as is.
The buyer's work to check a property before committing, such as inspections, surveys, HOA documents and zoning. In some states, like North Carolina, it is a defined period with a fee paid to the seller.
A deposit the buyer puts down after the offer is accepted to show they are serious. It is held in escrow or a trust account and usually goes toward the down payment or closing costs at closing.
A condition in the contract that must be met for the sale to go forward, such as an inspection, loan approval or appraisal. If it fails within the deadline, the buyer can usually cancel and keep the earnest money.