Wondering how the Texas option period really works when you are buying in Frisco? That short window after your offer is accepted can feel like a race against the clock, especially in competitive neighborhoods. You want enough time to inspect, negotiate, and protect your earnest money without losing the home. In this guide, you will learn exactly how the option period works in Texas, what is typical in Frisco, and how to use it to make a strong offer with smart protection. Let’s dive in.
What the option period is
The option period is a negotiated window after your offer is accepted when you have the unrestricted right to terminate the contract for any reason. This right exists only because it is written into the contract and you pay an option fee. The length and fee are both negotiated with the seller. If you terminate during the option period, you typically receive your earnest money back, but the option fee is not refunded.
For the formal rules and standard forms used statewide, review the Texas Real Estate Commission’s resources on TREC contract forms and guidance.
Option fee vs. earnest money
The option fee is consideration you pay to secure the unrestricted right to terminate during the option period. If you use that right and walk away on time, the seller keeps the option fee.
Earnest money is a separate deposit that shows your intent to close. It is usually refundable only under the contract’s terms, which can include a timely termination during the option period. Once the option period expires, you no longer have that unrestricted termination right.
Typical Frisco timelines and fees
In balanced markets, option fees in Texas often range around 100 to 500 dollars. In hotter seller markets that Frisco sometimes experiences, buyers may offer higher option fees, such as 500 to 2,000 dollars or more, to stand out. The right number depends on competition, price point, and seller expectations.
Common option period lengths include 3, 5, 7, or 10 days. In competitive North DFW situations, many buyers target 3 to 5 days to get inspections done quickly. Some winning offers use 0 to 3 days or even waive the option period, which requires extra care with due diligence.
For context on market competition and trends, you can review local reports from the MetroTex Association of REALTORS.
How the clock really works
Your contract controls when the option period begins and ends. In many cases, the clock starts when both parties sign and the option fee is delivered on time per the contract. The period is typically measured in calendar days, and the expiration time is specified in the contract.
Delivery and notice rules matter. Termination must be sent the way the contract requires and within the deadline. Do not assume weekends or holidays change the timing unless the contract says so. When in doubt, aim to act early and get written confirmation of delivery.
Who holds the money
Earnest money is typically deposited with the title company, escrow agent, or a broker or attorney escrow per the contract. The option fee delivery can vary by contract and local practice. Your agent will confirm whether it is delivered to the seller, the listing brokerage, or the title company and by what deadline.
Ask for written confirmation that funds were received and cleared. This helps you verify when the option period officially starts so you can plan inspections and negotiations.
Use your option period wisely
Your goal is to get fast inspections, identify repair needs, and decide whether to proceed, negotiate, or terminate. Book your inspector as soon as your offer is accepted. If possible, have an inspector lined up before you even make the offer.
Frisco single-family inspection checklist
- General home inspection: structure, roof, HVAC, plumbing, electrical.
- WDI/termite inspection.
- Roof or chimney specialist if you see prior repairs or leaks.
- HVAC specialist if the system is older or performance is uncertain.
- Sewer scope for older areas or heavy tree coverage, or if backups are reported.
- Pool inspection if applicable.
- Gas line and leak checks if the inspector notes concerns.
- Compare the inspector’s findings with the seller’s disclosure.
- Review HOA documents and survey if you have boundary or use questions.
Scheduling tips
- Book the main inspection within 24 to 48 hours of acceptance.
- Allow one full day for the inspection and 24 to 48 hours for any specialist follow-ups.
- Keep your schedule flexible so you can attend the inspection and discuss findings on-site.
Negotiation workflow during the option period
You have three paths once inspection results are in hand.
- Proceed as-is if the home meets your standards.
- Request repairs, credits, or a price adjustment in writing with specific items and reasonable estimates. Prioritize safety and major systems first.
- Terminate within the option period if issues are not acceptable and negotiations stall.
Sellers can accept, counter with repairs or credits, or decline. If you cannot reach agreement, you may still terminate on time within the option period and typically retain your earnest money while the seller keeps the option fee.
Strategies to win in Frisco while staying protected
Your approach depends on the market and the property.
If competition is strong:
- Consider a shorter option period, such as 1 to 3 days, paired with a higher option fee.
- Combine strong earnest money with a clean offer structure.
- Have your inspector pre-scheduled to maximize the short window.
If you need more inspection protection:
- Negotiate a 5 to 7 day option period.
- Offer a modest price improvement but keep the option period intact.
- Avoid mixed signals, like waiving the option while asking for multiple repairs upfront.
HOA and taxes: what to review in Frisco
Many Frisco neighborhoods have active HOAs. Ask for CC&Rs, architectural guidelines, fee schedules, and any pending special assessments. If you need more time to review HOA documents, negotiate specific delivery and review deadlines in the contract.
For property tax context, review values and records through the Collin Central Appraisal District. This helps you understand tax proration and potential future assessments as you evaluate the home.
Common pitfalls to avoid
- Letting the clock run: missing the option deadline removes your unrestricted termination right.
- Vague repair requests: be specific, attach photos or inspector notes, and give ballpark estimates.
- No backup plan: if you waive or shorten the option period, consider pre-offer inspections where possible or plan faster follow-ups.
- Unclear delivery: send notices the way the contract requires and get written confirmation of receipt.
Your next steps
- Get fully pre-approved and include your letter with offers.
- Ask your agent to share recent local contract trends so you set realistic option fees and timelines.
- Line up your inspector before you write the offer so you can book immediately.
If you want calm, clear guidance tailored to Frisco and North DFW, we are here to help. Reach out to Darna Real Estate Group to talk through your strategy, timeline, and the right option period for your offer.
FAQs
Is the option fee refundable in Texas?
- No. The option fee is generally non-refundable and is paid to the seller for your unrestricted right to terminate during the option period. If you terminate on time, your earnest money is typically refunded.
How long is a typical option period in Frisco?
- Common lengths are 3, 5, 7, or 10 days. In competitive Frisco situations, many buyers aim for 3 to 5 days, and some offers use 0 to 3 days or waive the option period.
Who holds the option fee and earnest money in Collin County?
- Earnest money is typically held by the title company, escrow agent, or a broker or attorney escrow. The contract controls where the option fee goes, and local practice can vary.
How do I officially terminate during the option period?
- Deliver written notice the way your contract specifies and before the deadline. Confirm delivery and receipt in writing to protect your earnest money.
Where can I learn more about Texas contracts and market context?
- For contracts and consumer info, see the Texas Real Estate Commission. For buyer guidance and market commentary, visit Texas REALTORS. For local trends, check MetroTex.
