MY OPTION AGREEMENT - FREE

General Real Estate Investing
1

OPTION AGREEMENT BETWEEN

THE OWNERS / VENDORS:

Optioned Property

AND OPTION BUYER

WHEREBY IT IS AGREED AS FOLLOWS

In consideration of the sum of $ : 00. Receipt whereof is hereby acknowledged, paid to the vendors by the buyers, the vendors hereby gives and grants to the buyers the Option to purchase at any
time within * Year/s * Month/s from the date hereof, the following parcel of land / property and dwelling house] [ Known to be the vendors land and property] [With all buildings, outbuildings, gateways, access points and rights of way pertaining thereto] [being unmeasured tracts of land and sold by the tract] See plan:>

THIS IS AN OPTION TO PURCHASE ALL THAT CERTAIN
LOT OR PIECE OF GROUND KNOWN AS > [ADD DESCRIPTION]

LAND PARCEL AGREED LOT AND BRIEF DESCRIPTION. PURCHASE PRICE

OPTIONED
LOT

$0 00

Whereas: [] If the option holder shall during the said option period give Notice in writing to the Vendors exercising the said Option/s, and shall then pay to him / her a deposit of $1000 towards the total purchase price of the lot/s elected to purchase then this Agreement and the Notice of Election to purchase this land shall constitute a contract for the sale and purchase of the said lot/s of land.

[] The vendors agree that they will deliver, convey, and exchange the title deeds to this land/s to the Option Holder on exchange of the full purchase price with freehold possession of same

[] For the avoidance of doubt this Agreement gives the Option Holder the unencumbered right to purchase this land/s at a specific known price on a future date

[] This contract constitutes the entire Agreement between the parties, and no representation, promise, or inducement not included in this contact shall be binding upon any party hereto. For the true performance of this agreement the vendor/s bindeth himself / herself, his/ her heirs, executors, assignees, and successors in title for ever []

WITNESS / hereby agreed to by the parties. [x signing boxes]

DATE: PARTY [1] PARTY [2]
Name

  Name      Name

Address:

  Address:                       Buyers  Address:

Buyer.
Signature

X Vendor/s.
Signature
X Vendor/s.
Signature
OPTION FEE PAID
$ 00
DEPOSIT
[To be paid on the exercise of option]

TOTAL PURCHASE PRICE $ OF OPTIONED LOT.

DEPOSIT PAID TO BE DEDUCTED FROM THIS SAID PURCHASE PRICE.

2

You must be a Brit.

3

Should it be said that the option fee is non-refundable - or is that assumed?

4

Doesn’t hurt to be redundant in agreements but that normally is assumed. Leaving anything up to interpretation leaves room for a lawsuit. Option consideration is payment for the option of buying the property, not a deposit.

You give me $5,000 so you can pick and choose when and if you want to buy my property at a later date. It’s simply payment for leaving the possibility on the table.

5

Its assumed the Option fee is non-refundable, if you were to take it back then this would make the option void for lack of consideration. Whats not widely known is that the sum of $1 or $10 dollars is just as good in law as $1000, $5000, or $5m dollars. My usual Option Fee is $10-00. If I tell them that I want to check out planning issues, to line up possible finace, or to see if I can find a partner to come in with me this suffices. They want the deal and want action.

I once took out a 3 year option, about 2 years later he wanted out and mailed me the option fee back with a letter “saying he had changed his mind”, this letter confirmed all the option said and made it obvious in Law we had an agreement in place. I sent him the Option fee back [told him we refused to rescind] and kept the letter, About 2 years later we took possession. This letter was important evidence because when it was coupled with the Option Agreement the two documents vouched in court for each other.

*Option docs on the internet are poor, very basic, I’ve read them all.

  • My option agreement was in word boxes, sign boxes, and had a logo. This forum site displayed the words only.
    Its set out quite impressively in the original.
6

I was looking at using an option agreement more from a seller’s point of view - I would like to lease/option a property. However, when I am the seller, I will be asking for more than $10 - $1000…more like $10,000, and I would think that you’d want the potential buyer to be aware that his/her $10,000 is non-refundable. Now, if I was the buyer, then I would use $10 - $1000 for consideration.