What is an option to purchase?

An option to purchase is a type of real estate contract in California that grants a buyer the right to purchase a property within a certain period of time. Specifically, an option to purchase gives the buyer the right to purchase the property at a predetermined price and on a given date. This option is typically used when the buyer is uncertain about making a final commitment to purchase the property. A buyer who has purchased an option to purchase has the right to accept or reject the seller’s offer. If the buyer chooses to accept the offer, they will pay the purchase price stated in the option agreement and take ownership of the property. If the buyer rejects the offer, the seller keeps the money paid for the option and the option agreement is void. Options to purchase are a helpful tool for buyers and sellers because they allow a buyer to purchase a property without having to commit to a full purchase. For the seller, an option to purchase can provide assurance that the buyer is taking the agreement seriously and will put a significant amount of money down. For the buyer, an option to purchase reduces the risk of making a full commitment to a property.

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What is an option to purchase?

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