Worried your dream Sherman home might hide a costly surprise? In Texas, the option period is your built-in safety window to check the property and make a clear decision. If you are new to the area or to Texas contracts, this short timeline can feel fast and a bit confusing. In this guide, you will learn exactly how the option period works in Sherman, what it costs, how to plan inspections, and how to protect your earnest money. Let’s dive in.
Option period basics
The option period is a negotiated, paid right in Texas contracts that allows you to terminate for any reason within a set number of days after the contract is executed. It is created in the option paragraph of the standard Texas contract forms, such as the TREC One to Four Family Residential Contract. You pay a separate option fee in exchange for this right.
Your option terms are negotiable. You and the seller agree on the number of days and the fee amount before the contract is signed. The contract also specifies who receives the fee and how delivery should occur, such as to the seller, listing agent, or title company.
Option fee vs. earnest money
The option fee is separate from earnest money. The option fee is typically nonrefundable and is kept by the seller if you terminate within the option window. Earnest money is generally refundable if you terminate on time according to the contract procedures.
If you terminate under the option, you usually lose only the option fee. Your earnest money is typically returned, as long as you delivered notice correctly and within the deadline set in the contract.
How it is documented
The contract must clearly state the option period length and the fee. It should also state where and how the fee is delivered. Best practice is to document receipt of the fee and confirm whether it will be credited at closing or retained by the seller as consideration. In many transactions, it is retained, though some parties agree to credit it at closing.
Fees and timelines in Sherman
In many Texas resale markets, typical option periods range from about 5 to 10 days. Shorter periods, such as 0 to 3 days, can happen in competitive situations. Longer periods, like 10 to 14 days or more, may be used when properties are older or have complex systems.
Option fees in Texas often range from about $100 to $500 in balanced markets. In competitive situations, buyers sometimes offer $1,000 to $2,500 or more to stand out or to secure a longer option. In Sherman and greater Grayson County, local inventory and demand will influence how aggressive you may need to be.
Older homes or properties with items like foundations, roofs, septic systems, or pools can justify a longer option period and a larger fee. Your agent can advise you on current Sherman norms, which can shift seasonally and with market conditions.
Timing logistics to plan
- Book your general home inspection the moment the option period begins. Spring and summer can fill inspectors’ schedules quickly.
- Order specialty inspections early. Septic, sewer scopes, roof evaluations, and HVAC reviews often require separate appointments and can take 24 to 72 hours for scheduling and reporting.
- Confirm fee handling in writing. Know who receives the option fee, where it is deposited, and whether it will be credited at closing.
Inspection strategy for Sherman
Your inspection plan should fit North Texas conditions. The goal is to get clear, actionable answers fast enough to make confident decisions inside your option window.
Book these first
- General home inspection by a licensed inspector who follows a recognized standard of practice
- Wood-destroying insect inspection by a licensed structural pest control operator
These two give you a solid overview of the home’s systems and reveal whether you need additional specialists.
Target Sherman risk areas
- Expansive clay soils. North Texas, including Grayson County, has clay-rich soils that can cause foundation movement, especially in slab-on-grade homes. If you see cracks, doors out of square, or prior foundation work, consider a structural or foundation specialist.
- Hail and severe weather. Roofs in North Texas can show wear from storms. Ask about roof age and insurance claim history, and consider a roof-specific review if the roof looks worn or patched.
- Termites and wood-destroying organisms. Termite activity exists in many parts of Texas. A WDI inspection by a licensed professional helps you understand current or past activity and needed treatment.
- Flood risk. Review FEMA flood maps and local floodplain designations. Homes near creeks, drainage areas, or the Lake Texoma vicinity may require flood insurance, which affects your budget.
Specialty inspections to consider
- Foundation or structural engineer evaluation
- Roof inspection or roofer assessment
- Sewer line camera scope for older lines or backup history
- Septic system inspection and permit review if applicable
- HVAC evaluation, chimney and fireplace inspection
- Well water testing for private wells
- Mold or indoor air quality testing if you see signs of moisture
- Radon testing if you are concerned, based on your preference
Scheduling best practices
Book inspections on day 1 of the option period. Ask for same-day or next-day verbal summaries and rapid written reports. If a major concern appears, you may need time for a second opinion. Having even one or two days left in your option window can be the difference between a renegotiation and a rush decision.
Use your option to negotiate
The option period is your strongest leverage for repairs or credits. Your inspection reports let you choose between three paths: move forward as-is, negotiate repairs or credits, or terminate.
Repairs, credits, or price adjustments
Sellers are not required to agree to all repair requests. Focus on material items that affect safety, structure, or major systems. Many buyers request credits instead of repairs when timing is tight or when they prefer to control the quality of the work after closing.
If you reach an agreement, put it in writing using the appropriate amendment or repair addendum. Document scope and standards clearly, and set timelines if the seller will complete work before closing.
Termination mechanics and deadlines
To terminate under the option, you must deliver written notice to the seller or the seller’s agent within the option period, using the delivery method and address in your contract. If you terminate on time, your earnest money is typically refunded. The option fee is normally kept by the seller as consideration for granting the option.
If you miss the deadline, you lose the unrestricted right to terminate under the option. At that point you remain bound by the contract unless another contingency applies.
Loan and appraisal timing
Your option period is separate from your loan and appraisal deadlines. An appraisal issue does not automatically permit termination unless your contract includes a financing contingency or other agreed protection. Keep your lender updated on inspection findings and timelines so there are no surprises.
Buyer checklist: Sherman option period
Use this quick list to stay organized and on time.
- Confirm option terms in your signed contract: days, fee amount, delivery instructions
- Pay and document the option fee with receipt and who holds it
- Schedule general and WDI inspections immediately
- Order any needed specialty inspections: foundation, roof, sewer scope, septic, HVAC, pool, well, mold
- Review reports quickly, prioritize major defects, and request estimates
- Decide your path: move forward, negotiate repairs/credits, or terminate
- Sign any repair or price amendments in writing
- If terminating, deliver written notice early and confirm receipt
- Keep your lender informed of any material findings that could affect the loan
Mistakes to avoid
Avoid these common pitfalls that cost buyers time and money.
- Starting inspections late. Busy seasons can fill calendars quickly and compress your decision window.
- Focusing on cosmetics. Use your option time for safety, structure, major systems, and budget-impacting items.
- Skipping a WDI inspection. Termites and other wood-destroying organisms are a known Texas risk.
- Overlooking flood risk. Check floodplain status and insurance implications early, especially near waterways or Lake Texoma.
- Being unclear on fee handling. Confirm who holds the option fee and whether it will be credited at closing.
- Missing the notice address. Deliver termination or amendments exactly as your contract requires to avoid disputes.
Work with a local pro
The option period moves fast, especially in a competitive market. A trusted advisor helps you structure the right option terms, line up inspectors on day one, and negotiate from a position of confidence. If you are relocating to North Texas or buying your first Texas home, you deserve clear guidance, quick scheduling, and organized negotiations.
Ready to talk strategy for your Sherman home search and option period game plan? Connect with Minouche Martins for local insight, bilingual support if needed, and a clear, step-by-step process from offer to close.
FAQs
How does the Texas option period protect Sherman buyers?
- It gives you a paid, unrestricted right to terminate within a set number of days, so you can complete inspections and walk away for any reason while typically preserving your earnest money.
What is a typical option fee and length in Texas resale deals?
- Many buyers negotiate 5 to 10 days with fees around $100 to $500, while competitive situations can see shorter windows or higher fees such as $1,000 to $2,500.
How is the option fee different from earnest money in Sherman purchases?
- The option fee is usually nonrefundable and kept by the seller if you terminate, while earnest money is generally refundable if you deliver timely termination under the option.
Which inspections should I prioritize during the option period?
- Schedule a general home inspection and a wood-destroying insect inspection first, then add specialists such as foundation, roof, sewer scope, septic, or HVAC based on findings and property features.
How do I terminate a contract under the option in Texas?
- Deliver written notice to the seller or seller’s agent before the option deadline using the method and address specified in your contract; your earnest money is typically refunded, and the seller keeps the option fee.
What happens if I miss the option period deadline in Sherman?
- You lose the unrestricted right to terminate under the option and remain bound by the contract unless another contingency or contract remedy applies.
Can I demand all repairs I want during the option period?
- You can request repairs or credits, but sellers are not required to agree; use the option period to negotiate or terminate if the issues are unacceptable.
