Buying a home in Frisco moves fast. In a multiple-offer situation, you want room to inspect without putting your offer at a disadvantage. The Texas option period is the tool that helps you do both. By the end of this guide, you’ll understand how the option period works, what’s typical in Frisco, and how to use it to protect your investment while staying competitive. Let’s dive in.
What the Texas option period is
The option period is a short, negotiated window after the contract is signed that gives you the right to terminate the contract for any reason. You must give written notice to the seller before the deadline. In exchange for this right, you pay an option fee to the seller.
The option fee is separate from earnest money. The seller usually keeps the option fee if you terminate during the option period. If you terminate in time, you typically receive your earnest money back under the contract terms.
In practice, the option period is set in the Texas Real Estate Commission’s One to Four Family Residential Contract (Resale). The contract has an Option paragraph where you fill in the number of days and the option fee. The clock usually starts on the effective date, which is the date the last party signs. Always follow the contract’s notice and delivery instructions when sending a termination notice.
Key mechanics to know
- The option period countdown starts on the effective date in the contract.
- Termination must be in writing and delivered per the contract before the deadline.
- The option fee is typically paid to the seller or the seller’s broker for delivery to the seller.
- The option period does not change other deadlines unless both parties amend the contract.
Typical timelines and fees in Frisco
Across Texas, option periods commonly run 3 to 10 days. In many situations, 5 to 7 days gives enough time for a general inspection and any quick follow-up checks. Option fees often range from about $100 to $500, depending on market conditions and property complexity.
Frisco is part of the DFW market, which can be very competitive. What is typical shifts with supply and demand:
- In tight, multiple-offer markets: buyers often shorten option periods to 0 to 3 days and may increase the option fee to stand out.
- In cooler markets with more inventory: 5 to 10 days with option fees around $100 to $300 is more common.
Property type matters. Higher-priced or unique homes and properties with potential complexities often need 7 to 10 days or more, plus room for specialist inspections. New construction contracts handle inspections and termination differently from resale contracts, so expect a different process and timelines with builders.
How to use the option period wisely
The option period is your inspection window. Use it to evaluate the home and make an informed decision while you still have a unilateral right to terminate.
What to inspect
- General home inspection: structure, roof, electrical, plumbing, and HVAC.
- As needed: sewer scope, pool inspection, chimney, pest, mold, and HVAC performance checks.
- If signs of movement or cracking appear: consider a foundation or structural engineer evaluation.
Inspectors book quickly in DFW. As soon as your offer is accepted and the contract is effective, schedule the general inspection for the earliest available slot. If you suspect foundation, roof, or pool issues, coordinate specialty inspectors the same day or the next day.
Outcomes before the deadline
- Proceed as is: accept current condition and continue toward closing.
- Negotiate repairs or credits: formalize any agreement via an amendment during the option period.
- Terminate: send written notice before the option period expires. The seller usually keeps the option fee; your earnest money is typically returned per the contract.
Strategy tradeoffs in Frisco
Choosing the right mix of days and fee can make your offer stronger without taking on unnecessary risk.
- Longer option period (7 to 10 days): gives time for specialists and reduces inspection risk; may be less competitive in hot markets.
- Shorter option period (0 to 3 days): strengthens your offer; increases your risk if unexpected issues surface.
- Higher option fee: signals commitment and can offset a shorter period. It is generally nonrefundable if you terminate. If you close, it can be credited at closing if negotiated in the contract.
Common combinations you might see in Frisco:
- 3 days with a $300 option fee to balance speed and seriousness.
- 5 to 7 days with a $100 to $200 fee in a cooler market.
- In multiple offers, some buyers waive the option or set 0 to 2 days with a higher fee to compete. This increases risk and should be used carefully.
Step-by-step timeline from offer to deadline
- Before you offer
- Talk with your lender and agent about timelines and inspection availability.
- Pre-identify your preferred general inspector and any specialists. Confirm next-available appointments.
- When drafting the offer
- Fill in option days and the option fee in the Option paragraph of the TREC contract.
- Confirm earnest money amount and delivery instructions separately from the option fee.
- If you need special timing or access for inspections, include that in your negotiation plan.
- After acceptance and effective date
- Immediately schedule the general inspection and any specialty inspections.
- Track the option deadline and set reminders for 24 hours and 4 hours before it expires.
- Review inspection reports promptly and decide: proceed, negotiate, or terminate.
- If terminating, send written notice per the contract and keep proof of delivery before the deadline.
Risk management checklist
- Book your inspector early and be ready to go same-day or next-day.
- Prioritize big-ticket systems: foundation, roof, HVAC, plumbing, and electrical.
- Line up specialists in advance if the property suggests complex issues.
- Keep financing and appraisal contingencies separate from the option period. The option period covers your right to terminate; financing has its own timelines.
- Confirm who receives and receipted the option fee and when it was delivered.
- Know exactly how to deliver written notice under the contract if you need to terminate.
Common seller responses in Frisco
Sellers in competitive situations look for certainty. You may see these responses to your offer:
- Accept the option period and fee as written.
- Counter with fewer days or a higher option fee.
- Decline an option period and invite a revised offer.
- Agree to your option terms in exchange for other concessions, such as price or timing.
Keep your offer competitive
A strong Frisco offer pairs speed with smart protection. Consider a short option period paired with a meaningful fee if the market is tight, but only if your inspector can get there immediately. If you need more time for a complex property, set expectations with the seller and move quickly on scheduling. The right mix depends on inventory, the home’s condition, and your comfort with risk.
If you want help calibrating option days and fees to current Frisco conditions, a local, high-activity team can guide you through these tradeoffs and move fast on inspections and negotiations.
Ready to make a confident offer in Frisco? Connect with The Tomlin Team Real Estate Group to map out your option strategy and inspection plan.
FAQs
What is the Texas option period in a home purchase?
- It is a negotiated window after contract execution that lets you terminate for any reason with written notice, in exchange for an option fee paid to the seller.
How many option days should a Frisco buyer request?
- Typical ranges are 3 to 10 days; in competitive moments 0 to 3 days can help, while 5 to 7 days is common when inventory allows more time.
How much is a typical option fee in Frisco?
- Practical ranges are about $100 to $500, with higher fees often used to strengthen short option periods in multiple-offer situations.
Is the option fee refundable in Texas?
- Generally no; the seller usually keeps the option fee if you terminate, and it may be credited at closing if negotiated when you complete the purchase.
What is the difference between option fee and earnest money?
- The option fee buys your termination right during the option period; earnest money shows good faith under the contract and is typically returned if you terminate properly.
When does the option period start and how do I give notice?
- It usually starts on the effective date in the contract; termination must be in writing and delivered per the contract before the option deadline.
What inspections should I complete during the option period?
- Start with a general home inspection, then add specialists as needed, such as foundation, sewer scope, pool, chimney, pest, or mold.
How do new construction contracts in Frisco handle inspections?
- Builder contracts often have different inspection and termination terms than resale contracts, so expect a different process and timelines with new homes.
