Option to purchase
A contract giving a buyer the right, but not the obligation, to buy a property at a set price within a set window. The buyer pays an option fee for the privilege.
Every term like this one lights up in the step you're on.
Free to set up. No credit card.Part 1 of 4
Why a seller cares
An option gives somebody the right to buy at a set price for a set time, usually for a fee. Sellers meet it in lease-option deals and in offers from investors who want time before committing.
Part 2 of 4
A simple example
A tenant pays $5,000 for a two-year option to buy at $250,000. For two years you cannot sell to anybody else at any price.
| What the holder does | What follows |
|---|---|
| Buys inside the window | The sale goes ahead at $250,000, whatever the market did |
| Lets the window pass | You keep the $5,000 and are free to sell to anyone |
| Tries to buy after the window | No right remains; it is a fresh negotiation |
An option is time bought with money. The price is fixed, the decision is theirs.
Part 3 of 4
What people get wrong
That an option obliges the buyer. It is a right, not a promise; only the seller is bound during the window.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · drawn from the reference glossary · how we research and check what we publish
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