The option period in Texas is the buyer's right to walk away from a contract for any reason — bad inspection, cold feet, a better house — and recover their earnest money. It's the single most powerful right a buyer has, and it's negotiated in three or four lines of TREC Form 20-17 Paragraph 5.
What the option period actually grants
Under ¶ 5B, the buyer can deliver written notice of termination to the seller at any time during the option period and the contract terminates, with the buyer's earnest money refunded. The buyer doesn't have to give a reason. They don't have to negotiate. They send the notice (typically TREC Form 38-8, Notice of Buyer's Termination of Contract) and the deal ends.
The seller's only consolation is the option fee (¶ 5A) — the small consideration the buyer paid for this right. That fee is non-refundable. If the contract specifies, it can credit toward the sales price at closing, but if the deal terminates during the option period, the seller keeps it.
The mechanics: how ¶ 5B counts time
The option period:
- Starts on the Effective Date (the date the last party signs and delivery happens, per ¶ 8).
- Runs for whatever number of calendar days the parties negotiate. Typical option periods in Texas are 5 to 14 days; busy market norms tend toward 5-7, calmer markets toward 10-14.
- Ends at 5:00 PM local time on the final day — not midnight, not close of business, 5:00 PM exactly per the paragraph text.
- Does not roll over for weekends or holidays. ¶ 5B is the one TREC deadline that explicitly excludes itself from the ¶ 23 rollover rule.
The most expensive mistakes
1. Delivering notice late
5:00 PM on Saturday means 5:00 PM on Saturday. If your client emails the termination notice at 5:02 PM, the option right is gone and the only path forward is a cause-based termination (financing falls through, inspection-objection cure period expires without resolution, etc.).
2. Assuming the inspection extends the option
The option period is fixed when the contract is signed. Inspection findings don't extend it. If a major issue surfaces on day 6 of a 7-day option, the buyer has roughly 24 hours to negotiate repairs, draft an amendment, get it signed by both sides, or terminate. Add another inspection (foundation, structural, septic) and the math gets brutal.
3. Confusing the option fee deadline with the option period
Two separate ¶ 5A deadlines: the option fee and the earnest money are both due within 3 days after the Effective Date by default (and they roll per ¶ 23). The option period itself starts on the Effective Date and runs through ¶ 5B's day count — different clock, different rules.
4. Verbal extensions
Texas courts won't enforce an oral extension of the option period. The only valid extension is a written amendment (typically TREC Form 39-9) executed by both parties before the original option expires.
Practical advice for the agent
Set three reminders: 48 hours before, 24 hours before, and the morning of. The buyer will tell you they remember — they will forget. If your contract management can't surface this, you're betting your earnest-money refund odds on a manual checklist. That's exactly what Dossie was built to fix.