How Long is the Texas Real Estate Option Period?

The Option Period is a negotiable timeframe during which a buyer can terminate the contract for any reason and receive their earnest money back. Sponsoring brokers train agents to never miss this critical deadline.

Why the Correct Option is Right

Option B is correct because the length of the Option Period is completely negotiable between the buyer and seller. However, the time it expires is fixed: Paragraph 5 specifies that the buyer’s right to terminate ends exactly at 5:00 PM (local time where the property is located) on the final day of the option period.

Why the Other Options are Traps

• Option A is a trap because 10 days is a common default used in negotiations, but it is not a statutory or contractual requirement. Midnight is a massive trap—missing the 5:00 PM deadline can cost your client their earnest money.
• Option C is a trap because there is no automatic 14-day rule.
• Option D is a trap because financing contingencies are separate from the termination option.

The Exam Trap

Pay close attention to the 5:00 PM time. On the exam, questions will test what happens if a termination notice is sent at 5:01 PM on the final day. At 5:01 PM, the option has expired, and the buyer no longer has the unrestricted right to terminate under Paragraph 5.

Worked Texas Example

Scenario: Jim’s contract specifies an 8-day option period ending on Tuesday. The home is located in Dallas, Texas. Jim’s inspector finds a plumbing issue, and Jim decides to terminate. His agent sends the termination notice on Tuesday at 5:15 PM Central Time. Outcome: Jim’s termination notice is late and ineffective under the option paragraph. His right to terminate expired at 5:00 PM. If he refuses to buy, he defaults and will likely forfeit his earnest money.