Buying in Memorial comes with big decisions and short timelines. One of the fastest-moving steps is the Texas option period, and if you handle it well, you protect your earnest money and your negotiating power. If you miss a deadline, you can lose your broad right to walk away. In this guide, you’ll learn exactly what the option period is, how it works in Memorial, and the steps to take from day one so you can move forward with confidence. Let’s dive in.
Texas option period basics
The option period is a short, negotiated window after your contract is accepted when you can terminate for any reason and receive a return of your earnest money. You pay an option fee to the seller for this right. The language for this is built into the standard Texas contract forms widely used for residential resales.
Texas treats this differently than states that use inspection contingencies. Here, you get a flexible, buyer-controlled period to run inspections and due diligence. After it expires, you no longer have a broad unilateral right to terminate and must rely on other contract provisions that may apply.
A few mechanics to know:
- The option period starts on the contract’s effective date.
- You must pay the option fee as the contract instructs and deliver written notice if you decide to terminate.
- Earnest money is held in escrow and follows the contract’s rules on refunds. The option fee is separate and is typically not refundable to you.
How it works in Memorial
Typical timelines and fees
In the Houston area, option periods often range from about 3 to 10 days. In many Memorial offers, a common pattern is 5–7 days. During very competitive moments, buyers sometimes offer shorter periods or even waive them. In softer conditions, you may negotiate longer.
Option fees vary by the home and competition level. You may see anything from a few hundred dollars to several thousand in competitive scenarios. Memorial can be more competitive than some nearby suburbs, so expect shorter periods and higher fees when demand is strong.
Paying the option fee
The contract sets the delivery method and deadline for the option fee. In practice, payment is made promptly after the effective date, often within 1 to 3 days, and may be routed to a title company or as directed by the contract. Remember, this fee is distinct from your earnest money.
Inspections to prioritize in Memorial
Plan your inspections early so you have time to review results and respond within your option period.
- General home inspection for structure, roof, HVAC, plumbing, and electrical.
- Wood-destroying insect inspection and pest review.
- Foundation or structural evaluation, especially with slab-on-grade homes on expansive clay soils.
- Roof inspection for age, storm wear, and leaks.
- Drainage and grading assessment given Houston’s heavy rain patterns.
- Flood-related due diligence: check flood zones, ask about any past flood events, review elevation data if available, and evaluate flood insurance needs.
- Survey review to confirm boundaries, easements, and encroachments.
- Review HOA or deed restrictions, especially in the Memorial Villages, where covenants and architectural controls can shape what you can change later.
- Verify utilities and any atypical systems.
Local risk factors to weigh
Memorial’s older custom homes and large lots bring unique considerations. Clay soil movement can affect foundations. Mature trees can impact roots, drainage, and utility lines. Some pockets sit near bayous, so flood risk, historic events, and insurance are key parts of due diligence. In certain villages, restrictive covenants can affect remodels or additions, so review those documents early.
Coordinate with other deadlines
Your option period overlaps with other time-sensitive items like earnest money delivery, loan application milestones, HOA and title document reviews, and survey ordering. Front-load inspections so you have room to decide whether to move forward, negotiate, or terminate before the option window closes.
Your Memorial buyer checklist
Use this step-by-step sequence to stay in front of deadlines.
Before you make an offer
- Engage a trusted local agent and line up inspectors who know Memorial homes, soils, and flood patterns.
- Get a lender pre-approval and understand your financing timelines.
- If allowed, consider a pre-offer inspection to strengthen your position in a competitive setting, though this is not always available.
Day 0–1: Effective date confirmed
- Confirm the effective date and calculate the option period end date in calendar days.
- Pay the option fee exactly as the contract directs and deposit earnest money as required.
- Make sure the title company has your fully executed contract and contact information.
Days 1–2: Book inspections and order documents
- Schedule the general inspection, WDI inspection, and key specialists: foundation/structural, roof, HVAC, pool or other systems as needed.
- Request the seller’s existing survey or order a new one if necessary.
- Start HOA and deed restriction review. Ask for architectural guidelines if you plan to remodel.
- Review property tax and appraisal details and confirm the legal description.
- Check flood maps and request seller disclosures about any prior flood events.
Days 2–4: Complete inspections and review title
- Complete inspections, with priority on foundation and roof if time is tight.
- Title work should begin, including review of easements and exceptions.
- Continue HOA and deed restriction review to understand any limits on design changes, fencing, or pools.
Days 4–6: Estimates and decisions
- Collect written estimates for any material issues such as foundation, roof, HVAC, plumbing, or drainage.
- Decide whether to terminate, request repairs, or request a price or credit adjustment. Sellers are not obligated to repair, so be ready to negotiate.
- Deliver any repair requests or amendment proposals in writing and leave time for back-and-forth before the option period ends.
Day before expiration: Finalize your path
- If terminating, send a written Notice of Termination per your contract and confirm receipt so your earnest money is handled correctly.
- If moving forward, document any agreed repairs or credits in a signed amendment. Be specific on scope and timing.
After the option period
- If you proceed, continue lender-required steps, appraisal, and any follow-up inspections.
- Track agreed repairs and make sure invoices or credits are documented for closing.
Smart negotiation moves
Memorial sellers often aim to limit uncertainty by asking for shorter option periods or higher option fees. As a buyer, you can balance risk and competitiveness.
- Consider a shorter option period if your inspectors can move quickly. Lining up vendors in advance gives you flexibility.
- Strengthen your offer with a meaningful option fee if the market is hot. Match the fee to the home’s price point and competition level.
- When issues arise, many sellers prefer a closing credit rather than managing repairs. Decide which approach works best for your timeline and risk tolerance.
- Be cautious about waiving the option period. Without it, you lose a broad termination right and must rely on narrower contract provisions.
Avoid these common mistakes
- Waiting to schedule inspections. In a 5–7 day window, a one-day delay can compress your decisions.
- Overlooking flood risk. Review flood zones, ask about flood history, and evaluate insurance early.
- Skipping a foundation specialist when signs of movement exist. In this area, it is a key cost driver.
- Ignoring deed restrictions. If you plan changes, verify what is allowed before the option period ends.
- Missing the written notice requirement. Termination must be in writing and delivered on time per the contract.
Terminate or renegotiate?
Use your inspection reports and estimates to choose a path before the deadline. If the costs and risks do not fit your plan, terminate within the option period to protect your earnest money. If the home still works with adjustments, request repairs or a credit and document any agreement with an amendment before your option window closes.
The bottom line for Memorial buyers
In Memorial, the option period is your most valuable early safeguard. Plan fast, local inspections, confirm flood and foundation risk, and keep every step on the clock. If the numbers or risk profile shift, you have a defined window to renegotiate or walk away. With the right guidance and preparation, you can move from offer to closing with confidence.
Ready to secure the right Memorial home with a clear plan for your option period? Work with Nancy Almodovar and the team at Unknown Company for expert guidance tailored to your goals.
FAQs
What is the Texas option period in home buying?
- It is a short, negotiated window after contract acceptance when you can terminate for any reason and receive a return of earnest money. You pay an option fee for this right.
How long is a typical option period in Memorial?
- Market-dependent. Many offers land around 5–7 days, with shorter periods in competitive situations and longer periods when conditions allow.
What is a typical option fee for Memorial homes?
- Ranges from a few hundred dollars to higher amounts in competitive scenarios. Fees increase when buyers shorten timelines to win an offer.
What inspections should Memorial buyers prioritize?
- General home, foundation/structural, roof, WDI, HVAC, and flood risk review. Drainage and survey review are also important.
How do I terminate within the option period?
- Deliver a timely, written Notice of Termination per your contract and confirm receipt by the seller or title company so your earnest money is handled correctly.
What happens if I miss the option deadline?
- You lose the broad unilateral right to terminate and must rely on other contract provisions. Timely inspections and decisions are critical.
What is the difference between option fee and earnest money?
- The option fee is paid to the seller for your termination right and is typically not refundable to you. Earnest money goes to escrow and is handled per the contract’s terms.
