Option FAQ’s

How a Real Estate Option Transaction Works

Optionor-One who gives or sells an option / Optionee-The receiver and holder of option

Here’s a sequential outline of the mechanics of how a straight real estate option transaction works:

Step #1: The optionee pays real estate option consideration to the optionor.

Step #2: The optionor grants the optionee the exclusive or non exclusive option to purchase property at a fixed purchase price during the option period by executing a straight real estate option agreement with the optionee.

Step #3: The optionee exercises his or her real estate option, or lets it expire.

Step #4: Once exercised, a straight real estate option agreement turns into a bilateral agreement in which the optionee becomes the buyer, and the optionor the seller.

Step #5: The buyer and the seller execute a detailed purchase agreement.

Step #6: The seller transfers property title to the buyer at closing.

Advantages To Seller

(1) Someone else aggressively selling house
(2) No expense
(3) No risk
(4) All cash sale
(5) You’re not taking house off market

FAQ

(1) Why should I let you tie up my house?
(A) You shouldn’t. I won’t

(2) Why don’t I just list?
(A) Go ahead. exlude me and give me 90 days first

(3) Why should you have even one day to option?
(A) I’M not taking off the market. You can’t lose.
How many days will your realtor give you?

(4) How do I know you’ll sell?
(A) You don’t buy you have nothing to lose
and I don’t make a cent unless I sell.