Thinking about making an offer in Dallas County and wondering how to protect yourself while you inspect the home? The Texas option period can feel confusing at first, especially in a fast-moving DFW market. You want time to do inspections without risking your earnest money or losing out to a stronger offer. In this guide, you’ll learn exactly how the option period works, what it costs, how long it lasts, and smart strategies to use it well in Dallas County. Let’s dive in.
What the option period is
The option period is a short, negotiated window after your contract is signed that gives you an unrestricted right to terminate for any reason. You purchase this right with an option fee stated in the contract. During this time, you can complete inspections, request repairs or credits, or decide to walk away.
The option fee is separate from your earnest money. Earnest money is typically held by the title company as a sign of good faith. The option fee is consideration paid for your right to terminate within the option period. Whether the option fee is credited at closing if you proceed depends on your contract.
How it works in Texas and DFW
The option period typically begins on the contract’s effective date, which is when all parties sign. The final day and time to act are set by the contract, and many contracts set the deadline at 5:00 p.m. local time on the last option day. Always check your executed contract to confirm the exact timing.
In Dallas County, the length and fee are negotiable and shaped by market conditions. Many buyers use about seven days as a starting point. In competitive situations, buyers may offer 0 to 3 days or waive the option entirely to strengthen an offer. In a cooler market or for complex properties, you can negotiate longer.
Typical timelines and fees
- Common option length: 3 to 10 days. Seven days is a frequent starting point.
- Competitive scenarios: 0 to 3 days or, at times, waived by buyers to stand out.
- Longer windows: 10 or more days when you need specialty inspections.
- Option fee: Often $100 to $500 in many transactions, with higher fees, sometimes $1,000 or more, to compete in hot neighborhoods or price points.
If you terminate within the option period, you typically get your earnest money back. The seller usually keeps the option fee as consideration. If you proceed to closing, your contract may allow the option fee to be credited to you. Always confirm what your specific contract says.
What to do during the option period
Your goal is to complete due diligence quickly and confidently. Schedule inspectors immediately after your contract is executed and make sure your agent receives written reports before the deadline.
Common inspections in Dallas County include:
- General home inspection covering roof, foundation, HVAC, plumbing, and electrical.
- Foundation or structural engineer review, especially for older homes where movement is a common concern.
- Roof inspection and HVAC evaluations.
- Sewer scope to check for line damage.
- Pool inspection when applicable.
- Wood-destroying insect inspection. Some lenders require this.
- Mold or air-quality testing, and lead-based paint testing for homes built before 1978. Radon testing is less common but available if you want added certainty.
Estimated inspection costs in DFW generally range as follows:
- General home inspection: about $300 to $600.
- Sewer scope: about $150 to $300.
- Structural or foundation engineer: about $400 to $1,000+ depending on scope.
- Specialty tests like mold, radon, or pool: about $150 to $500 each.
- Pest or wood-destroying insect inspection: about $50 to $200.
Actual pricing varies, so verify with local inspectors.
Negotiating after inspections
Once you have your reports, you can:
- Proceed as is and move toward closing.
- Request repairs, credits, or a price reduction using a written amendment.
- Terminate within the option period if the home no longer fits your needs or budget.
If you request repairs or credits, your agent will present a written amendment listing items discovered. The seller can accept, counter, or decline. If the seller agrees to repairs, make sure your amendment specifies who pays, what work will be done, whether licensed contractors are required, and the timeline for completion.
If you do nothing by the deadline, your unrestricted termination right expires. After that, any termination would be governed by other contract terms, and your earnest money could be at risk if you default. If you need more time, you can ask for an extension, which usually requires an additional option fee and a signed amendment. The seller can agree or decline.
DFW market realities to keep in mind
- Option period terms influence offer strength. Shorter periods or higher option fees can make your offer more attractive to sellers when multiple offers are common.
- Standard seven-day windows still work in many situations, especially when inventory is more balanced.
- For older homes or properties that may need specialized evaluations, longer option periods can be worth negotiating so you can bring in a structural engineer or other specialists.
Smart strategy for buyers
- Clarify the trade-off. A shorter or waived option period may help you win the house, but it limits your time to find issues and reduces your flexibility.
- Move fast. Confirm your exact expiration date and time, and schedule inspections right away. Aim to complete your general inspection in the first day or two so you have time for follow-ups.
- Understand the money flows. Your earnest money is typically held by the title company. Your option fee is paid as the contract specifies and is consideration for your termination right. Know whether the fee will be credited at closing.
- Get the right experts. In Dallas County, foundation, roof, and sewer are common focus areas. If a system looks questionable, bring in a specialist during the option window.
A quick buyer checklist
- Deliver the option fee by the contract deadline and keep proof of payment.
- Schedule the general inspection immediately after the contract is effective.
- Line up specialists early if needed: structural engineer, roofer, HVAC, pool, or sewer.
- Review all reports with your agent and prioritize safety or major system items.
- Decide your path: repair request, credit or price reduction, proceed as is, or terminate.
- If needed, request an option extension via written amendment before your time expires.
Real-world examples
- Competitive offer: You offer full price with a 2-day option and a $1,000 option fee to make your offer stand out. You schedule inspections same day, review findings, and confirm you want to proceed.
- Cautious buyer: You negotiate a 10-day option for an older home so you can get a structural engineer’s opinion on the foundation and an additional roof evaluation before committing.
- Post-inspection pivot: Your inspector identifies major foundation issues. You terminate within the option period and recover your earnest money, allowing you to redirect your search.
Common mistakes to avoid
- Waiting to schedule inspections. In short option windows, even a one-day delay can limit your choices.
- Missing the deadline. If 5:00 p.m. local time applies in your contract, do not cut it close.
- Requesting repairs verbally. Always use a written amendment so expectations are clear and enforceable.
- Overlooking contract details. Know exactly how your option fee and earnest money are treated in your signed agreement.
The bottom line for Dallas County buyers
The option period is your safety net. It gives you time to investigate the home, negotiate repairs or credits, or step away if needed while preserving your earnest money. In Dallas County’s market, the right option terms can also help you compete. With a clear plan, quick scheduling, and the right team, you can use this window to protect your purchase and move forward with confidence.
If you want help crafting the right option terms and lining up reputable inspectors fast, connect with a local advisor who knows Dallas County’s rhythms. Reach out to Nichelle Keithley to get a game plan that fits your goals.
FAQs
What is the Texas option period in a home purchase?
- It is a negotiated, short window after contract execution where you can terminate for any reason in exchange for an option fee, usually while you complete inspections.
How long is the option period in Dallas County?
- Many buyers use about seven days, but terms vary with market conditions and can range from 0 to 10 days or longer as negotiated.
What happens to my earnest money and option fee if I terminate?
- If you terminate within the option period, your earnest money is typically refunded, and the seller usually keeps the option fee per your contract.
Can I extend my option period if inspections take longer?
- Yes, if the seller agrees. Extensions require a written amendment and often an additional option fee.
Do I need specialized inspections in DFW?
- It depends on the home. Foundation reviews, roof checks, sewer scopes, and wood-destroying insect inspections are common, with added tests as conditions suggest.
When exactly does my option period end?
- Your contract controls the deadline, and many set it at 5:00 p.m. local time on the final day. Confirm the date and time in your executed contract.
Should I waive my option period to win a bidding war?
- Waiving can strengthen your offer but raises risk because you give up a flexible termination right. Consider it only when conditions and your due diligence allow.
