What is an Option Clause in a real estate contract?

An Option Clause is a provision in a real estate contract that gives a potential buyer the right to purchase a property within a designated period and at a set price. This clause is especially beneficial to buyers as it gives them the opportunity to purchase real estate without making an immediate commitment to do so. In North Carolina, the Option Clause is a part of a real estate contract known as the “Option to Purchase Agreement.” This agreement details the buyer’s right to purchase the property and outlines any fees and deadlines associated with the purchase. The Option Clause typically offers the buyer a limited period of time to consider their purchase, and during this time, they can inspect the property and receive incentives from the seller to complete the transaction. The Option Clause also requires the buyer to pay an option fee for the right to purchase the property. This fee typically ranges from 1 to 5 percent of the purchase price and is paid to the seller to secure the buyer’s right to purchase the property. The fee is usually nonrefundable and is deducted from the purchase price if the buyer submits the purchase offer before the expiration of the Option Clause. The Option Clause is an important part of residential real estate contracts in North Carolina, as it offers buyers the opportunity to purchase a property without immediately committing to doing so. It also provides sellers with a payment for the buyer’s right to purchase the property and an incentive to consider any offers they may receive.

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What is an Option Clause in a real estate contract?

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