Option to Purchase Forms
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What is an option?
In the context of real estate, an option is a contract to purchase the right for a certain time, by election, to purchase property at a stated price. An option may be a right to purchase property or require another to perform upon agreed-upon terms. By purchasing an option, a person is paying for the opportunity to elect or "exercise" the right for the property to be purchased or the performance of the other party to be required.
Sometimes an option is the right to renew a contract, such as a lease, broadcasting a television series, the employment of an actor or athlete, or some other existing business relationship. A "lease-option" contract provides for a lease of property with the right to purchase the property during or upon expiration of the lease.
How can I choose to use an option after it's created?
"Exercise" of an option normally requires notice and payment of the contract price. The option will state when it must be exercised, and if not exercised within that time, it expires. If the option is not exercised, the amount paid for the option is not refundable.
What are the most common forms to use for Options?
The most popular forms used are Contract for the Lease and Mandatory Purchase of Real Estate – Specific Performance Clause, Option for the Sale and Purchase of Real Estate – Residential Home, Option for the Sale and Purchase of Real Estate – Commercial Building, Option to Purchase Real Estate – Long Form, and Contract for the Lease and Purchase of Real Estate – Purchase by date or leave.