You found the right home in Houston’s Inner Loop, but you need time to inspect and decide with confidence. The Texas option period is your built-in safety net, giving you a short window to investigate and, if necessary, walk away. In this guide, you’ll learn what the option period is, how it works in Houston, typical timelines and fees, and smart strategies to use it well. You’ll also know when to bring in trusted local help so your next move feels calm and controlled. Let’s dive in.
What the option period means in Texas
The option period is a negotiated window after your contract becomes effective that gives you an unrestricted right to terminate for any reason. You pay a separate, nonrefundable option fee to the seller for this right. If you terminate within the option period, your earnest money is typically returned per the contract, while the seller keeps the option fee.
This structure is part of the standard Texas contracts promulgated by the Texas Real Estate Commission. You and the seller decide the length and the fee, and both are written into the contract. Think of it as your time to verify condition, costs, and comfort before you fully commit.
Importantly, the option period is different from other contingencies. Financing and appraisal clauses still exist on their own terms. The option period is broader, because it allows you to terminate for any reason as long as you give proper written notice before the deadline.
How it works in Houston
Typical timelines
The length of the option period is negotiable. In many Texas markets you will see 3, 5, 7, or 10 days. Weekends and holidays count, and the clock starts from the contract’s effective date. Because the days are limited, it is smart to schedule inspections immediately.
In Houston’s more competitive areas, sellers often push for shorter option windows or even waivers. In slower conditions, buyers can usually secure longer periods. Your agent should guide you based on the neighborhood and current activity.
Option fee basics
The option fee is the price you pay for your unrestricted termination right. In routine situations it often ranges from about 100 dollars to several hundred dollars. In hotter Inner Loop scenarios, buyers may offer higher fees to win a longer window or a stronger position. If the contract allows, the option fee can be credited to you at closing. If you terminate within the option period, the seller keeps the fee.
Earnest money vs. option fee
- Earnest money: Good faith deposit held by the escrow or title company under the contract. It is refundable only under certain contract conditions, including a valid option-period termination.
- Option fee: Paid to “buy” the unrestricted right to terminate during the option period. It is typically nonrefundable to the seller, but may be credited at closing if the contract says so.
How to terminate on time
If you choose to terminate, you must give written notice before the option period expires. The contract spells out acceptable delivery methods and who must receive the notice. Common practice is to deliver to the listing agent and the title company as directed in the contract. Once timely notice is delivered, the contract ends under the option clause and your earnest money is typically returned per the escrow instructions.
After the option period expires, you no longer have the unrestricted right to terminate. Other contract terms, such as financing or appraisal protections, may still apply depending on your agreement.
Extending the option period
You can extend the option period only if both parties sign a written amendment. Sellers often request an additional option fee for an extension. Extensions can be helpful if your inspections uncover issues that require follow-up or specialist evaluations.
Inner Loop norms buyers should know
In high-demand Inner Loop neighborhoods like West University, River Oaks, Southampton, and Braes Heights, sellers often prefer fewer option days. One to three days is common in multiple-offer situations, and some buyers will waive the option altogether to compete. That said, waiving the option increases risk because you give up the unrestricted right to walk away.
In more moderate parts of Harris County, option periods of 3 to 7 days are typical. Option fees often range from about 100 to 500 dollars, influenced by the home’s price, condition, and current competition. On older homes or properties with known issues, sellers sometimes ask for higher option fees, and buyers weigh that against the value of a longer inspection window.
Use your option time wisely
Inspections to schedule first
Use the option period for fact-finding. Start with a general home inspection as soon as the contract is effective. Depending on the property, you might add a pest inspection, HVAC check, roof evaluation, foundation review, and a sewer scope. In Houston, it is common to bring in specialists for structural, moisture, drainage, and storm-related roof concerns. Book early so you have time to interpret results and plan next steps.
Strategy choices and trade-offs
- Longer option period, lower fee: More time to investigate and negotiate, but your offer may be less competitive in a bidding war.
- Short option period, higher fee: Stronger in multiple offers, but you will have limited time to coordinate specialists.
- Waiving the option: Strong for the seller, highest risk for you. You lose the unrestricted out and must rely on other contingencies that are narrower.
A balanced approach is common. Some buyers offer a meaningful fee for a short option if the market is hot, then plan for fast inspections with a back-up plan to request a short extension if needed.
Repair negotiations that work
After inspections, you can propose repairs or a credit via a written amendment. The seller may agree, counter, or decline. If you cannot reach agreement within the option period, you can terminate and keep your contractual protections intact. Keep all reports and photos organized to support your requests and help both sides reach a fair outcome.
When to bring in a local advisor
Lean on a local agent who understands current norms for each Inner Loop pocket and can tailor your offer. Choose an inspector familiar with Houston’s soil, drainage, and storm patterns. If you uncover major defects or there is confusion around notices and deadlines, consult a Texas real estate attorney for clarity.
A simple option period checklist
- Confirm the contract’s effective date and the option period end date and time.
- Schedule a general inspection within 24 to 48 hours of execution.
- Line up specialists early for foundation, roof, sewer, HVAC, or pest.
- Read the contract delivery instructions for notices and amendments.
- Set phone reminders for every deadline. Weekends and holidays count.
- Discuss repair requests with your agent and submit any amendment in writing.
- If you terminate, deliver written notice before the deadline and confirm receipt.
- If more time is needed, request an extension in writing and be prepared to offer an additional fee.
Avoid these common missteps
- Waiting to book inspections and running out of time.
- Assuming texts or casual emails count as proper notice when the contract requires specific delivery.
- Mixing up earnest money with the option fee and expecting both to be refunded.
- Letting the deadline pass and losing the unrestricted termination right.
- Skipping specialist inspections on older or complex homes to save time.
The bottom line for Houston buyers
The Texas option period is a powerful tool when you use it with intention. In Houston’s Inner Loop, your strategy on days and fees can make or break your offer, but the real value is the time to inspect and get comfortable. Move quickly, document everything, and keep your deadlines front and center. With the right plan and local guidance, you will protect your investment and stay on track to closing.
If you are weighing how many days to ask for, what fee to offer, or how to structure inspections in a competitive neighborhood, let a trusted Inner Loop advisor help. Reach out to Gayle G. Kennedy for tailored, neighborhood-savvy guidance.
FAQs
Is the option fee refundable in Texas?
- No. The option fee is typically nonrefundable to the seller, though it can be credited to you at closing if the contract allows. If you terminate during the option period, your earnest money is typically returned per the contract and escrow instructions.
How many option days are typical in Houston?
- In many Harris County areas, 3 to 7 days is common. In competitive Inner Loop neighborhoods, sellers often expect 1 to 3 days, and some buyers waive the option to compete.
What happens if I need more time for inspections?
- You can request an extension, but it requires a written amendment signed by both parties. Sellers may ask for an additional option fee in exchange for more days.
How do I terminate during the option period?
- Deliver written notice according to the contract instructions before the deadline. Once timely notice is delivered, the contract ends under the option clause and your earnest money is typically returned per the escrow instructions.
What inspections should I prioritize in Houston?
- Start with a general home inspection, then add pest, HVAC, roof, foundation, and sewer scope as needed. In Houston, specialists for structural and drainage concerns are often helpful.
Is the option period the same as an inspection contingency?
- No. The option period gives you an unrestricted right to terminate for any reason within a set time. Financing and appraisal clauses, if included, are separate and have different standards and remedies.
