In what way must an option fee be paid in a contract?

The correct answer is that an option fee must be paid independently of any other consideration. This is an important aspect of real estate transactions in Texas that reflects the intent and structure of option contracts.

An option fee serves as a financial consideration given by the buyer to the seller to secure the exclusive right to purchase the property for a specified period. This fee is separate and distinct from other payments like earnest money deposits, which are intended to show the buyer's serious intent to purchase and may also be credited towards the purchase price at closing. By requiring the option fee to be paid independently, it ensures that the seller has a clear and guaranteed compensation for providing the buyer with the option to purchase the property, without conflating it with earnest money or any other funds that may have different implications in the contract.

This separation helps clarify the terms and intentions of each fee, ensuring both parties understand their obligations and rights clearly within the transaction.