Buying in Westlake comes with big decisions, tight timelines, and serious money on the line. If you have heard people talk about the Texas “option period,” you might wonder what it really protects and how to use it well. You want clarity before you commit so you can inspect, negotiate, or walk away without risking your earnest money. In this guide, you will learn exactly how the option period works in Texas contracts, how it plays out in Westlake, and the steps to follow so you never miss a deadline. Let’s dive in.
What the option period means in Texas
The option period is a short window you negotiate in the purchase contract that gives you the unconditional right to terminate for any reason. If you terminate within that window, you typically receive your earnest money back. This right comes from the standard Texas residential resale contract language that buyers and sellers agree to when they sign.
You pay an option fee for this right. The option fee is usually modest and paid directly to the seller or the listing broker, as the contract allows. If you close, it is often credited to you at closing. If you terminate during the option period, the seller usually keeps the option fee.
This window gives you breathing room to inspect the home, review the title commitment, read HOA documents, verify utility and permitting info, and decide whether to proceed. It also creates time to negotiate repairs or credits based on what you learn.
How timing and deadlines work
Texas REALTORS and local Austin brokerages use standardized contract forms. Your option period begins on the contract’s effective date, which is the date all parties sign and agree to all terms. Many forms set an exact expiration time, often 5:00 p.m. local time on the final day unless the contract says otherwise. You must send written notice to terminate before the deadline to use your option right.
Option periods vary. In Austin, you often see 3 to 10 days, with 7 days common. In competitive situations, buyers sometimes shorten or even waive the option period to strengthen an offer. Whatever you choose, the number of days must be in writing in the contract.
If you decide to terminate under the option, you must deliver written notice to the party named in the contract by the deadline. If you terminate on time, the seller keeps the option fee and your earnest money is handled per the contract and escrow instructions.
Option fee vs. earnest money
These two payments serve different purposes:
- Option fee: Payment for your unilateral right to terminate during the option period. This fee is usually non-refundable if you terminate. If you close, it is often credited to you.
- Earnest money: A separate deposit showing good faith, held by a title company or broker. If you terminate during the option period or under other contract rights, your earnest money is generally refundable as the contract provides. If you miss deadlines or breach later, it may be at risk.
A simple 7-day Westlake checklist
Here is a practical timeline many Westlake buyers use for a 7-day option period. Adjust if your contract has fewer or more days.
Day 0: Effective date
- Confirm your effective date and the exact option expiration date and time.
- Confirm where to deliver earnest money and the option fee.
- Book your general home inspection immediately.
Days 1–3: Core inspections and documents
- Complete the general home inspection. Expect basics on structure, HVAC, plumbing, electrical, roof, and pool if present. Typical costs run about $300 to $700 depending on size and features.
- Order specialty inspections if the home’s age, condition, or location suggests risk, especially in Westlake’s hilly terrain:
- Sewer scope or video inspection.
- Roof certification or detailed roof review.
- Foundation or structural engineer evaluation if you see cracks, slope, or retaining walls.
- HVAC evaluation and system start-up tests.
- Pool and spa inspection.
- Termite or wood-destroying insect inspection.
- Asbestos, lead, or radon testing if disclosures or home age suggest a need.
- If there is an HOA, request governing documents and the resale certificate, and start your review right away.
Days 3–5: Compare findings and verify records
- Review seller disclosures and line them up with your inspection results.
- Review the title commitment, survey if available, and any easements or access rights.
- Check local code or permit history if you see additions or major work. Open or unresolved permits may be an issue.
- Look up tax history through the Travis Central Appraisal District and ask about utility transfer steps for City of Austin providers if relevant.
Days 5–7: Decide, negotiate, or extend
- Decide whether to proceed, negotiate repairs or credits, or terminate. Any termination under the option must be in writing before the deadline.
- If you want repairs or credits, send a clear, written request. The seller can accept, counter, or refuse.
- If specialists need more time, request a written extension of the option period and expect to pay an additional option fee. Get the new date and time in writing.
Westlake-specific issues to check
Buying in Westlake means you should pay attention to a few recurring themes:
- Topography and slope: Many homes sit on hillsides with retaining walls and complex drainage. Look for erosion, grading problems, or soil movement risk.
- Foundation and expansive soils: Central Texas has areas of expansive clays and shallow bedrock. If the inspector notes movement, bring in a structural engineer.
- Mature trees: Large oaks add beauty and shade but can affect roofs, driveways, and drainage. Watch for root intrusion, canopy overhang near roofs, and irrigation patterns.
- Floodplain and creeks: Proximity to creeks or tributaries may involve mapped floodplain or localized flooding risk. Review flood info and ask your insurer about coverage scope and cost.
- Edwards Aquifer and watershed rules: Parts of Westlake fall within sensitive environmental zones that can affect remodeling, pools, or additions. Check applicable rules before planning changes.
- Pools and retaining walls: These are common on larger lots. Inspect pool equipment, decking, barriers, and any adjacent retaining walls for condition and safety.
- City of Austin permits: If the property is within the city, look for complete and closed permits on prior work. Unresolved permits or code issues can delay closings or increase costs.
- Utilities and fees: Confirm who provides water and wastewater. Ask about any outstanding balances, special assessments, or connection notes if you plan upgrades.
- Title and access: On larger lots, review easements and shared-drive agreements closely. Access rights and restrictions can affect everyday use and future plans.
- Taxes and appraisal: Review TCAD data for valuation trends. Changes in assessed value and exemptions can affect your future tax bill.
Smart negotiation in a competitive market
Westlake can be competitive. You can still protect your interests while making a strong offer.
- Keep the option period but shorten it to 3 to 5 days if needed. This shows commitment while preserving inspection rights.
- Raise the option fee to signal seriousness. A higher fee can help your offer stand out without giving up protection.
- Offset with other terms, such as a slightly higher price, flexible closing, or a short seller leaseback, rather than waiving the option period.
- Pre-line your inspection team before you write. Faster scheduling supports a shorter option period.
- Ask for a written extension if a specialist cannot get out in time. Expect to pay an additional option fee and document the new deadline in an amendment.
- Consider waiving the option only if you fully understand the risk, such as on a newer home with strong warranties or when you have already completed due diligence.
Risks, rights, and how to avoid disputes
Missing the option deadline usually ends your unconditional right to terminate for inspection reasons. If you try to terminate later for inspection issues, you may face a dispute and risk your earnest money.
Keep these protections in place:
- Track the deadline. Put the expiration date and time on your calendar with reminders.
- Deliver notices in writing to the right party as the contract requires. Keep proof of delivery.
- Put all repair agreements and extensions in signed amendments. Verbal agreements can be risky and hard to enforce.
- Understand that the option fee is typically non-refundable if you terminate. Your earnest money is usually returned when you terminate within the option period, per the contract.
Real-world Westlake examples
- Scenario A: 7-day plan succeeds. You complete the general inspection on day 2, sewer scope on day 3, and get reports by day 4. You request a seller credit for roof repairs on day 5. The seller counters with a partial credit you accept, and you proceed to closing.
- Scenario B: Multiple offers. You shorten the option to 3 days and raise the option fee to stay competitive. You schedule inspections immediately and decide by the deadline with solid data.
- Scenario C: Engineer needed. Your option period is 5 days, but a structural engineer can only visit on day 8. You secure a written 7-day extension and pay an additional option fee to keep your protection in place.
Typical costs to budget
Every property is different, but these ballpark ranges help you plan:
- General home inspection: about $300 to $700
- Sewer scope: about $125 to $400
- Structural engineer: about $500 to $2,000 or more
- Roof inspector or certification: about $150 to $500
- Termite or WDI inspection: about $50 to $150
- Specialty environmental tests: each can range from about $100 to $1,000 or more
- Option fee: often $100 to $500, and sometimes $1,000 or more in competitive offers
Work with a seasoned Westlake advisor
A clear, well-managed option period protects you while strengthening your position. With strong scheduling, focused inspections, and crisp written amendments, you can make confident choices in Westlake’s high-demand market.
If you are preparing to buy, reach out for a private, strategy-first conversation tailored to your goals and timeline. Request a Private Consultation with Unknown Company.
FAQs
What is the option period in a Texas home purchase?
- It is a negotiated window that gives you the unconditional right to terminate for any reason, usually in exchange for an option fee, while protecting your earnest money if you terminate on time.
When does the option period start and end in Austin?
- It begins on the contract’s effective date and typically ends at a set time, often 5:00 p.m. local time on the final day, unless your contract states a different time.
How is the option fee different from earnest money?
- The option fee pays for your termination right and is usually non-refundable; earnest money is a good-faith deposit held in escrow and is generally refundable if you terminate within the option period.
What inspections are most important for Westlake homes?
- Focus on general home, foundation and structural review if needed, roof, sewer scope, HVAC, pool, and termite; add environmental or specialty tests if disclosures or age suggest risk.
Can I extend my option period if I need more time?
- Yes, but you must obtain a written amendment signed by both parties that sets a new expiration date and any additional option fee.
Should I waive the option period to win in multiple offers?
- Only if you are comfortable with the risk, or you have completed enough due diligence; many buyers instead shorten the period and raise the option fee to stay competitive.
