You have only a few days to learn everything you can about a home after your offer is accepted. In Northwest Dallas, where properties can be complex and competitive, those days matter. If you understand the Texas option period, you can inspect with purpose, negotiate with confidence, and protect your earnest money if needed. This guide shows you how the option period works in Texas and how to use it wisely in Preston Hollow, North Dallas, and Park Cities-adjacent neighborhoods. Let’s dive in.
Texas option period basics
What it is and why it matters
The option period is a short, negotiated window early in your contract. It gives you an unconditional right to terminate the contract for any reason, as long as you send written notice before the deadline. In exchange, you pay the seller a separate, nonrefundable option fee. If you terminate in time, your earnest money is typically refundable under the contract.
This right comes from the contract itself. Texas resale contracts include an option provision that spells out the length, fee amount, delivery steps, and whether the fee is credited at closing. Read the exact form you sign. Deadlines and delivery rules are precise.
Option fee vs. earnest money
The option fee is the price you pay for flexibility. You pay it to the seller, or as the contract directs, and it is usually nonrefundable. Many contracts state it will be applied to your purchase price or costs at closing if you proceed.
Earnest money is a separate deposit, typically held by the title company. If you terminate properly within the option period, you usually receive your earnest money back per the contract.
When the clock starts and stops
The option period begins on the effective date of the contract. That is the date when all parties have signed and acceptance is communicated as the contract requires. The option ends after the agreed number of days.
You must deliver a written termination before the option period expires. The contract defines how to compute time and how notices must be delivered. Follow those instructions exactly to protect your rights.
What Northwest Dallas buyers should expect
Typical lengths and fees
Option periods in Texas commonly range from 3 to 10 days. In a competitive sellers’ market, buyers may offer 0 to 3 days or even waive the option. In balanced conditions, 5 to 10 days is common. For luxury or move-up properties, 5 to 10 days often makes sense to allow specialty inspections.
Option fees vary. Many transactions land between $100 and $500. In higher-priced or competitive luxury deals, buyers sometimes offer $1,000 or more to strengthen their offer. Contract language controls whether the fee is credited at closing.
Neighborhood and soil considerations
Northwest Dallas includes Preston Hollow, parts of North Dallas, and areas near the Park Cities. These homes can be higher priced and move quickly. Sellers may expect shorter option periods or higher fees.
Expansive clay soils are common across North Texas. This increases the risk of foundation movement and settlement. Prioritize structural evaluation early so you still have time to act on findings.
HOA and document review
Some properties fall under homeowners’ associations. If HOA documents apply, build time into your option period to review covenants, conditions, and restrictions, plus resale packets. You want clarity on fees, rules, and upcoming assessments before your deadline.
Inspection game plan for luxury and move-up homes
What to inspect first
Focus on the big systems and structural health. In Northwest Dallas, this priority sequence helps you make fast, informed decisions:
- General home inspection to review structure, roof condition, and major mechanical systems.
- Structural or foundation engineer if there are signs of movement or if the home is older.
- Roof inspection by a roofer to assess active leaks and remaining life.
- Termite and wood-destroying insect report, a Texas standard.
- HVAC specialist for high-end or zoned systems.
- Sewer scope, especially in older neighborhoods, to spot breaks or root intrusion.
- Pool and spa inspection, if applicable, including equipment and shell condition.
- Specialty testing if indicated, such as mold, lead-based paint in older homes, radon as optional, or asbestos where relevant.
- Survey or boundary review if lines or encroachments are a concern.
Typical inspection cost ranges
Budget for these approximate ranges, knowing local vendors vary:
- General home inspection: $300 to $600.
- Structural or foundation engineer evaluation: $400 to $1,200.
- Roof inspection or roofer estimate: $150 to $400.
- Sewer scope: $100 to $300.
- Termite inspection: $50 to $200.
- Pool inspection: $150 to $400.
- HVAC specialist: $100 to $300.
- Specialty lab testing: can range from the low hundreds to thousands.
Get written bids from local inspectors and engineers, and verify schedules before you write your offer if possible.
A day-by-day option timeline
Before you write the offer
- Decide on your ideal option length and expected fee with your agent.
- Line up your general inspector, structural engineer, roofer, sewer scope vendor, termite inspector, and pool inspector.
- Plan for more days if you expect multiple specialty inspections.
Day 0: Effective date
- Deliver the option fee as the contract requires. Deposit earnest money on time.
- Schedule the general inspection and priority specialists immediately.
- Confirm who receives notices and how delivery must occur for any termination.
Days 1 to 3: Core inspections
- Complete the general inspection and structural, roof, termite, and sewer checks.
- If a pool is present, get the pool inspection done quickly.
- If issues warrant, order specialty testing without delay.
Days 3 to 5: Estimates and analysis
- Gather written repair or replacement estimates for material items such as foundation, roof, HVAC, and pool.
- Review HOA documents if applicable, and confirm any fees or restrictions that affect your plans.
Day 4 to deadline: Decisions and delivery
- Decide to proceed, request repairs or credits, or terminate.
- If requesting repairs or credits, present a clear, itemized list with supporting estimates.
- If terminating, deliver written notice before the option period expires using the contract’s approved method.
Negotiation mechanics during the option period
Sellers can agree to repairs, offer credits, or decline. If you reach an agreement, document it in writing with specific timelines. If you do not, you can terminate on time and recover earnest money per the contract. The option fee is handled as the contract states.
If you need more time, you can request an extension. Sellers often require an additional option fee to agree. Put every extension in writing and get it signed before the original deadline.
Keep a clean paper trail. Save inspection reports, estimates, emails, and signed amendments. If disputes arise, documentation helps protect your position.
Common pitfalls to avoid
- Cutting the option period too short for a complex home with a pool, older plumbing, or possible foundation movement.
- Missing the notice deadline or using the wrong delivery method. The contract controls both.
- Asking for major repairs after the option period ends. Your unrestricted right to terminate is gone, and the seller does not have to agree.
- Assuming an as-is sale removes your option rights. It does not. It may affect post-option repairs, so decide within the option period.
- Overlooking HOA documents. Fees, rules, and pending projects can change your decision.
Your next step
When you are buying in Northwest Dallas, the option period is your leverage to inspect, confirm, and negotiate. A construction-informed strategy helps you use every day effectively so you protect your earnest money and focus on the right fixes. If you want a plan tailored to your home search and timeline, connect with Donna Hartley to align your option period, inspections, and negotiations.
FAQs
What is the Texas option period in a home purchase?
- It is a negotiated window early in the contract when you can terminate for any reason by delivering written notice before the deadline, in exchange for a separate option fee.
How do option fee and earnest money differ for Dallas homes?
- The option fee goes to the seller for your termination right and is usually nonrefundable, while earnest money is held by the title company and is typically refundable if you terminate properly within the option period.
How long should my option period be in Northwest Dallas?
- Many buyers use 5 to 10 days for thorough inspections, but in competitive situations you may see shorter periods. Confirm current local norms before you write your offer.
What inspections should I prioritize during the option period?
- Start with a general home inspection and, if indicated, a structural or foundation engineer, plus roof, termite, and sewer scope. Add HVAC and pool inspections where applicable.
Can I negotiate repairs after the option period ends in Texas?
- You can ask, but the seller does not have to agree. Your unrestricted termination right is tied to the option period, so negotiate or decide before it expires.
Can I extend my option period if I need more time?
- Only if the seller agrees in writing. Many sellers require an additional option fee for an extension, so request it early if needed.
