In some cases, property owners will grill you about buying an option on their property. Here are the five most frequently asked questions that property owners pose when negotiating real estate option agreements, along with the suggested answers:
FAQ 1: What exactly is a real estate option?
Answer: It is a legal arrangement under which I pay you a non-refundable fee for the irrevocable right to purchase your property for a set price during a specific period of time.
FAQ 2: Why do you want to buy a real estate option instead of the property itself?
Answer: Because I am not ready to purchase the property right now, but I want to have the property available for when I am ready to buy it, and real estate options give me the flexibility to do this.
FAQ 3: Why should I agree to a fixed purchase price now instead of when the option is exercised?
Answer: Because I am agreeing to buy an option on your property in an asis condition with no contingencies, and there is no incentive for me to buy options on properties that do not have a fixed purchase price at the time the real estate option agreement is signed.
FAQ 4: What happens if you do not exercise your option in time?
Answer: The option expires and you get to keep the entire option fee that I paid you.
FAQ 5: Why must I also sign a deed and purchase agreement at the same time we sign the real estate option agreement?
Answer: So that all of the documents that are needed to purchase the property will be readily available when the option is exercised.
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