How must the option fee be paid?

The option fee is designed to give the buyer the exclusive right to purchase a property during a specified time frame. It is typically paid to the seller and is distinct from other fees associated with the transaction. This fee is essentially compensation for the seller to take the property off the market while the buyer decides whether to go through with the purchase.

Paying the option fee directly to the seller ensures that there is a clear and straightforward transaction regarding the buyer's right to terminate the contract within the option period. This method of payment emphasizes the direct relationship and agreement between the buyer and seller, making it clear that this fee is for the buyer's benefit and tied to the negotiation term.

While option fees might sometimes be mentioned in the same context as earnest money or other fees, they serve different purposes and are handled separately to avoid confusion regarding their meanings and implications in the transaction. This separation is also crucial for clarity during negotiations and offers protection to both parties involved.