Other Information about Offers
The Texas single-family residential sales contract contains a provision that allows the buyer to create an "option" contract. An option in this case means that, for a non-refundable fee, the buyer has purchased the unrestricted right to terminate the contract within the amount of time specified in the contract. For example, if you make an offer that includes a 10-day option period for which you have paid a nonrefundable $150 option fee, and the seller accepts your offer, you have 10 days to have the home inspected and consider any other factors that are important to you. If you decide within that 10-day window that you do not want to purchase the home after all, for whatever reason, you can terminate the contract. The length of the option period and the amount of money required for the option fee are both negotiable items; however, a fee must be paid for the option to be enforceable.
At the time a written offer on the property is initiated, you will generally be required by the seller to include a personal check, cashier's check, or cash. The amount deposited will be kept in the trust account of the title company handling the sale and not turned over to the seller. This money represents your sincerity in the attempt to purchase and is totally refundable if the offer is not accepted or if some condition in the contract is not satisfied. (Example: Financing is not approved.) The deposit applies in full toward the purchase price at closing if the offer is accepted and all conditions are satisfied. The earnest money deposit is also a negotiable item and can range from $500 to $5,000 and up.