Can the option be signed electronically?

Yes in most cases. Electronic signatures are valid under the federal ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided the parties consent and the record is retained.

Is notarization required for validity?

Not generally required to create an enforceable option, but local practice and recording needs may make notarization advisable; check county recording rules.

What happens if the option period expires?

If not exercised before expiration, the option typically terminates and the optionee loses exclusive purchase rights unless the parties agreed to an extension.

How do I correct a mistake after signing?

Prepare a written amendment signed by all parties or a formal rescission and re-execution; minor clerical corrections sometimes use a signed errata or corrective deed.

Can the option be recorded?

Some jurisdictions allow recording an option memorandum or the executed option if it affects title; recording requirements and effects vary by county.

How do I revoke or cancel the option?

Revocation depends on the contract terms; an optionor cannot revoke after grant if consideration was paid and the option is valid until expiration or mutual release.

Electronic Signature
Templates
Real estate
Real Estate Option Form

Real Estate Option Form

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

Real Estate Option Form

Parties

This Option Agreement (the "Option") is made between Optionor (owner/grantor) and Optionee (prospective purchaser/licensee) under the terms set forth below.

Optionor (Seller / Grantor) — Full legal name Optionor — Mailing address Optionor — Phone / Email Optionee (Buyer / Licensee) — Full legal name Optionee — Mailing address Optionee — Phone / Email

Property Identification

Property Address (street, city, state, ZIP) Parcel / APN Number Legal Description

Option Terms

Consideration (non-refundable option fee): payable to Optionor upon execution of this Option.

Effective Date: ,

Option Period: days from the Effective Date. Expiration Date:

Purchase Price (if option exercised): . Exercise Price (amount to be paid at exercise, if applicable):

Application of Option Fee: The option fee shall be credited toward the Purchase Price at Closing if the Option is timely exercised and the parties close. If Optionee fails to timely exercise, the option fee shall be retained by Optionor as liquidated damages unless otherwise agreed in writing.

Exercise; Escrow and Closing

Manner of Exercise: Optionee may exercise this Option by delivering written Notice of Exercise to Optionor at the address for notices below within the Option Period. Notice shall be deemed given when delivered in person, sent by nationally recognized overnight carrier, or deposited in the United States mail, postage prepaid, certified mail, return receipt requested.

Escrow Agent (if any): Earnest Money on Exercise:

Closing Date: Possession Date:

Contingencies; Inspections

Inspection Period: Optionee shall have days from the Effective Date or receipt of full property access to conduct inspections. Optionee may terminate this Option within that period by written notice to Optionor, in which case the option fee shall be returned unless otherwise agreed.

Financing Contingency: Yes No — If Yes, days to obtain financing:

Title; Survey; Condition

Title: At Closing, Optionor shall deliver a marketable title by general warranty deed (or other specified deed) free of liens and encumbrances except those disclosed in writing. Title objections shall be cured prior to Closing or addressed in the settlement.

Survey: Responsibility for acquiring and paying for a survey shall be:

Condition of Property; AS-IS: Except for Optionor's express written warranties herein, Optionee accepts the property in its current condition as of the Effective Date, subject to the right to inspect and to require corrective action as set forth in this Option.

Required Disclosures

Lead-Based Paint Disclosure: Yes No

Known Mold or Water Intrusion: Yes No

Structural Damage or Prior Material Repairs: Yes No

If any disclosure is Yes, describe below

Default and Remedies

If Optionee fails to timely exercise the Option within the Option Period, Optionor may retain the option fee as liquidated damages without further remedy, subject to any other remedies available at law or equity. If Optionor refuses or is unable to convey title at Closing in accordance with this Option, Optionee may pursue specific performance or elect to recover actual damages, including return of the option fee and earnest money.

Notices

All notices required or permitted under this Option shall be in writing and delivered to the addresses set forth below by hand, certified mail, or overnight carrier. Notice addresses:

Optionor — Notice address Optionee — Notice address

Miscellaneous Provisions

Entire Agreement: This Option constitutes the entire agreement between the parties with respect to its subject matter and supersedes all prior agreements and understandings, whether written or oral. This Option may only be modified in a writing signed by both parties.

Governing Law: This Option shall be governed by and construed in accordance with the laws of the state in which the Property is located.

Binding Effect: This Option shall be binding upon and inure to the benefit of the parties and their respective heirs, successors and permitted assigns. Optionee may not assign its rights under this Option without the prior written consent of Optionor.

Additional Terms or Special Conditions

Acknowledgment

By signing below, the parties acknowledge that they have read and understand the terms of this Option and that the option fee is non-refundable except as expressly provided in this Option. The parties warrant that they have the authority to execute this Option and to bind the entities on whose behalf they sign.

Optionor (Print Name):

By:

Date:

Optionee (Print Name):

By:

Date:

What the Real Estate Option Form Is

A Real Estate Option Form is a written agreement that grants one party (the optionee) the exclusive right to purchase or lease a specified property from another party (the optionor) within a defined period and on agreed terms. It records the property description, the option period, the option consideration (fee), exercise procedures, and any contingencies. The form is not the purchase contract itself but creates a contractual right to later bind the parties to a sale or lease if the option is exercised. In the United States, electronic execution follows ESIGN and UETA frameworks when permitted.

Why a Written Option Matters

A properly drafted Real Estate Option Form preserves price and priority, limits competing offers during the option period, and clarifies exercise mechanics and remedies. It provides legal certainty about parties, deadlines, and consideration and can be executed electronically where ESIGN (15 U.S.C. ch. 96) or state UETA rules apply.

Who Typically Uses This Form

The Real Estate Option Form is used by buyers and sellers, investors, and brokers to lock in terms before a sale or lease decision.

Real estate investors seeking short-term control of acquisition rights without immediate purchase
Property owners or sellers who want a nonbinding fee to reserve a future sale
Brokers and agents coordinating timelines, contingencies, and exercise notice procedures

Use the form when you need exclusive purchase or leasing rights for a defined time while due diligence or financing is arranged.

Essential Parts of a Professional Option Form

A complete form combines clear party details, an accurate property description, precise timing, payment terms, exercise mechanics, and remedies for nonperformance to reduce post-signing disputes.

Parties

Identify optionor and optionee by full legal names and entity types; include contact details and signing authority to avoid ambiguity.

Property Description

Provide the legal parcel description or metes-and-bounds plus street address and county to ensure the option uniquely identifies the subject property.

Option Period

Specify exact start and end dates and time of day for exercise; include tolling or extension rules if inspection or financing contingencies exist.

Consideration

State the option fee amount, payment timing, whether it is refundable, and whether it will credit toward purchase at closing.

Exercise Terms

Describe how the option is exercised (written notice, delivery method), any required deposits, and conditions precedent to closing.

Default & Remedies

Set out consequences for failure to exercise or to close, option fee forfeiture, specific performance, and indemnity provisions.

Step-by-Step: Completing the Option Form

Follow these sequential actions to prepare and finalize a usable option agreement.

01

Review terms: Confirm price, dates, and contingencies with counsel.
02

Complete fields: Fill party, property, consideration, and exercise method.
03

Sign and notarize: Execute with required signatures and acknowledgements.
04

Distribute copies: Share fully signed copies to all parties and title counsel.

Setting Up an Online Completion Workflow

Configure a digital workflow that enforces fields, collects signatures, and preserves an audit trail for recordkeeping.

Field	Configuration
Authentication	Use email link plus optional SMS code or ID check for stronger signer verification
Template	Save as template to reuse standard clauses and field placements for similar properties
Conditional fields	Enable visibility rules for contingencies and financing clauses
Notifications	Set automatic alerts for approaching exercise deadlines and executed copies

Digital Signing and File Requirements

Use a platform that accepts PDF and DOCX, produces an audit trail, and supports common integrations.

File Types: PDF and DOCX supported
Integrations: Salesforce, Microsoft 365, NetSuite
Security: TLS in transit, AES-256 at rest

Where to Send or File the Completed Form

Decide distribution based on role: parties, title company, recording office, and your file retention policy.

To the Optionee: Provide an executed copy for their due diligence file
To the Optionor: Return fully executed original to seller or seller's counsel
Title Company: Deliver to title counsel if the option affects title or closing
Recorder: Record only on exercise if deed is conveyed; follow county recording rules

Key Dates and Timing to Track

Track all calendar events in writing and confirm notice delivery methods to avoid disputes about timeliness.

Option Effective Date:

Date when option rights begin and parties' obligations commence

Option Expiration:

Last date and time to validly exercise the option

Exercise Notice Deadline:

When notice must be delivered per the contract

Funding/Closing Date:

If exercised, date by which closing must occur

Recording Window:

Record deed or lease per local county timing if required

Milestones from Agreement to Closing

A typical option transaction follows a short sequence of milestones from execution through exercise and closing.

01

Drafting and Negotiation

Draft terms, confirm property description and consideration

02

Execution

All parties sign; notarize if required by local practice

03

Monitoring Period

Optionee completes inspections, financing, and contingencies

04

Exercise and Closing

Optionee delivers notice; parties proceed to closing per terms

Common Preparation Errors to Avoid

Using an incomplete legal description, which leads to ambiguity and title issues during closing
Failing to state whether the option fee is refundable or creditable, causing disputes at exercise
Not specifying the exact notice method and recipient, resulting in missed exercise deadlines
Skipping notarization when local practice expects it, complicating later recordation or enforcement

Risks and Consequences of an Incorrect Form

Enforceability Risk: Ambiguous terms can make the option unenforceable

Fee Forfeiture: Optionee may forfeit consideration if exercise conditions are not met

Loss of Priority: Failure to record deed promptly can affect title priority

Damages Exposure: Breach may trigger damages or specific performance claims

Tax Reporting: Incorrect reporting of option income can create IRS issues

Delay Costs: Missing deadlines can increase financing or holding costs

eSignature Provider Comparison for Executing This Form

Basic capability differences across eSignature providers affect authentication, bulk sending, and compliance; signNow appears first for direct feature comparison.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial, no card	Varies by vendor	Varies by vendor	Varies by vendor	Varies by vendor
Bulk Send	Yes	Yes	Yes	Yes	No
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No

Frequently Asked Questions About the Option Form

Answers to common legal and procedural questions about preparing, signing, and enforcing a Real Estate Option Form.

Need help? Contact support

Can the option be signed electronically?
Yes in most cases. Electronic signatures are valid under the federal ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided the parties consent and the record is retained.
Is notarization required for validity?
Not generally required to create an enforceable option, but local practice and recording needs may make notarization advisable; check county recording rules.
What happens if the option period expires?
If not exercised before expiration, the option typically terminates and the optionee loses exclusive purchase rights unless the parties agreed to an extension.
How do I correct a mistake after signing?
Prepare a written amendment signed by all parties or a formal rescission and re-execution; minor clerical corrections sometimes use a signed errata or corrective deed.
Can the option be recorded?
Some jurisdictions allow recording an option memorandum or the executed option if it affects title; recording requirements and effects vary by county.
How do I revoke or cancel the option?
Revocation depends on the contract terms; an optionor cannot revoke after grant if consideration was paid and the option is valid until expiration or mutual release.

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