My realtor is telling me that I cannot get a contract on a property with a contingency clause (subject to inspection) when dealing with listing agents. She says that the only way to lock a property is to buy an option on the property for 10-14 days and do all inspections in that time, after which you lose your option payment if you don’t close. Does anyone have experience with this? I know it’s possible to construct contracts with contingency clauses when dealing with private sellers, but is it not still possible with listing agents?
Howdy Drew:
Read the earnest money contract. They put option periods in there for inspections and an option price. As a buyer I put $10 as the option price and as a seller I want the buyer to pay hundreds.
To me it is all confusing. I am used to the old fashion way of getting a free look. Some banks have addendum’s that will supersede the earnest money contract and give a 14 day or so free look or option period for free.
How much option money does your Realtor think you need to put in the contract. It is still a contingency to the sale but could cost you if you decide to walk. There are also limits to seller repairs that are usually put into the contract that limit what the seller will spend on repairs. You can put limits too. Here again it can get bogged down and confusing. With the option you can walk for any reason and hopefully only lose a few bucks and get the earnest money back quickly and easily.
I have probably confused you more but hope it helps some too
pertaining to texas: get on the trec website and read a contract. in residential property contract there is a paragraph pertaining to option, this is a unilateral right for buyer to terminate contract for any reason, if option fee is paid. this amount can be any amount of consideration and must be paid at time contract is executed in order to be true. a seller typically wants this to be an amount to show true intent to purchase but in my experience on an average 150,000 house it is 75-150 dollars. keep in mind during that time the seller may not execute another contract, in first position. during option period it is advisable to get any inspections, insurance issues, and feasibility studies done. once option is up you risk being sued for specific performance if contract obligations are defaulted on. this should all be explained to you along with agency rules by your realtor, give them a chance to do their job, if they are not find one who will.