What is an Option Clause in a real estate contract?

An Option Clause in a real estate contract is an agreement between the buyer and seller that allows the buyer to purchase the property at a specified price after a certain amount of time. The buyer will pay a fee, known as an option fee or option deposit, in exchange for the right to buy the property. The option fee is usually a percentage of the purchase price and is refundable to the buyer if they decide not to buy the property. The buyer will have a set period of time, often referred to as the option period, to decide whether they want to buy the property or not. Under New York real estate law, an option clause must be included in the purchase and sale agreement for the option to be considered valid. The option clause should include the specific terms of the agreement, such as the purchase price, the option fee, and the duration of the option period. The option clause should also include the duties of both the buyer and seller and the consequences if the buyer fails to purchase the property within the prescribed period. It is important to have the option clause reviewed by an experienced real estate lawyer to make sure it meets the legal requirements in New York.

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What is an Option Clause in a real estate contract?

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