Option Period
Defines the start and end dates when the buyer may exercise the option. Be precise about time zones and deadlines to prevent disputes over late exercises.
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Tennessee Option to Purchase Form
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What the Tennessee Option to Purchase Form Is
Why a Formal Option to Purchase Matters
A documented option secures exclusive purchase rights, fixes price and timeline, and creates enforceable obligations for consideration, while allowing the seller to retain title until closing.
Who Typically Uses a Tennessee Option to Purchase
The form is used by parties who need a temporary, enforceable purchase right without immediate conveyance.
- Buyers and investors seeking time to complete inspections, financing, or due diligence before committing to purchase.
- Sellers who want to lock in a potential sale at a negotiated price while retaining ownership until closing.
- Real estate brokers, attorneys, and lenders facilitating conditional sale terms and protecting client interests.
Step-by-step: Completing an Option to Purchase
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01Prepare: Draft full legal description and define option consideration.
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02Define Terms: Specify option period, purchase price, conditions, and assignment rules.
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03Execute: All parties sign; notarize signature if recording is intended.
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04Record/Distribute: Record memorandum where desired and provide copies to parties.
Digital Execution and Distribution Requirements
Decide whether to execute on paper or electronically and confirm format and authentication requirements before sending.
- File Formats: PDF and DOCX accepted
- Authentication: Email or SMS code options
- Integrations: Common CRM and storage links
Configuring an Online Option-to-Purchase Workflow
| Field | Configuration | Placement | Required/Conditional |
|---|---|
| Property Description | Locked text | Required |
| Signature | Signer field | Required with date |
| Notary Acknowledgement | Optional field | Required if recording |
| Audit Trail | Enable | Capture IP, timestamp |
How eSubmission Typically Works
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Upload: Upload final draft to signing platform.
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Assign Fields: Place name, signature, and date fields.
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Authenticate: Send link with chosen authentication.
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Complete: Collect signed copies and audit log.
Core Components of a Professional Tennessee Option to Purchase
Purchase Price
Specifies the fixed sale price or the pricing formula. Include any adjustments, prorations, or credits that apply at closing to avoid later disagreement.
Legal Description
Includes full deed legal description to clearly identify the property. Attach exhibits when the property is part of a larger parcel or has easements.
Consideration
States the amount paid for the option and whether it is credited at closing or forfeited on non-exercise. Clarify payment timing and escrow handling.
Recording and Notice
Addresses whether a memorandum or notice will be filed in the county register. Recording provides public notice but does not transfer title.
Assignment and Termination
States whether the option may be assigned and the circumstances for termination, including default, bankruptcy, or failure to obtain financing.
Downloading, Saving, and Supporting Documents
Download Formats
Save signed copies as PDF/A for long-term retention; retain original executed PDF with audit trail metadata embedded.
Save Best Practices
Store executed copies in encrypted cloud storage and local backup. Maintain a version history and a signer audit log for disputes.
Supporting Documents
Include proof of payment of consideration, title search results, property exhibits, and any financing condition documents with the file.
Recording Copy
Prepare a short memorandum if recording is desired and follow county clerk formatting and fee requirements for recordation.
Key Risks and Consequences of Errors
Unrecorded Notice:
Priority loss
Ambiguous Description:
Enforceability dispute
Incorrect Parties:
Voidable obligation
Missing Consideration:
Contract invalidity
Expired Term:
Loss of rights
Improper Notarization:
Recording rejection
Common Mistakes to Avoid
- Using an informal street address instead of the full legal description leads to ambiguity and recording rejections.
- Failing to specify whether option consideration is refundable or credited at closing can produce later payment disputes.
- Skipping notarization when intending to record a memorandum may prevent entry in county records and reduce priority.
- Relying on minimal signer authentication for high-value transactions increases litigation risk over signature attribution.
Who Has Authority to Sign an Option to Purchase
Individual Buyer
The individual listed as buyer must sign in full. If signing through an agent, provide a dated power of attorney or corporate authorization showing explicit authority to bind the buyer before execution.
Entity Representative
For corporate or LLC sellers and buyers, an officer or authorized manager must sign and include title; attach a corporate resolution or certificate of incumbency when authority is not clearly shown on public records.
Notarization and Recording: Practical Steps
01
Prepare Executed Copy
Provide a clean signed original for notarization and recording.
02
ID Verification
Signer must present government ID to the notary.
03
Notary Acknowledgement
Complete formal notary block per state rules.
04
RON Alternative
Use Remote Online Notarization only if permitted by state law.
05
County Clerk Submission
Submit the required number of copies and pay recording fees.
06
Obtain Stamped Copy
Keep a stamped recorded copy for the title file.
07
Distribute Copies
Provide recorded copies to buyer, seller, and their counsel.
08
Retain Originals
Store executed originals securely per retention policy.
eSignature Vendor Comparison for Executing an Option to Purchase
| 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 | 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 |
Real-World Use Cases
Investor Secures Development Site
An investor obtains a one-year option to purchase a parcel near transit
- Option includes a right to extend for additional consideration
- With clear legal description and recording of a memorandum, the investor preserves exclusivity while seeking permits and financing, protecting investment without immediate title transfer.
Seller Manages Multiple Offers
A seller grants a short option to a preferred buyer during marketing
- Option consideration is credited at closing
- The seller retains market flexibility while assuring the buyer an exclusive window to perform inspections and secure financing.
Practical Tips for Accurate Completion
Use Precise Language
Avoid ambiguous terms and define all deadlines clearly. State times in MM/DD/YYYY and specify cut-off times to prevent late-exercise disputes; attach exhibits for complex property descriptions.
Confirm Authority
Verify and document the signatory’s authority when entities sign. Attach corporate resolutions or powers of attorney to the executed form to prove binding authority during title review.
Decide on Recording
Choose whether to record a memorandum. Recording provides public notice and priority but may require notary acknowledgment and adherence to county clerk formatting rules.
Retain Audit Evidence
If executed electronically, preserve the audit trail showing signer identity, timestamps, and IP addresses. Maintain signed PDFs with embedded metadata to support enforceability.
FAQs and Troubleshooting
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Can this form be signed electronically?
Yes. Electronic signatures generally satisfy enforceability standards under the federal ESIGN Act (15 U.S.C. ch. 96) and state UETA laws, provided the parties consent and the record is retained. Exceptions exist for documents explicitly excluded by statute; confirm the transaction is not excluded.
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Do I need a notary to record an option?
Most counties require a notarized acknowledgement for any instrument submitted for recording. If you plan to file a memorandum, obtain a proper notary acknowledgement or use approved Remote Online Notarization where state law permits.
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What if the option term expires?
Once the stated option term lapses without exercise, the buyer loses the exclusive right unless the parties agree to an extension in writing. Consider including notice procedures for exercising the option to avoid disputes.
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How can an option be revoked?
Revocation requires mutual agreement and written documentation; unilateral revocation by seller may be a breach if consideration was paid and option remains in force. Consult counsel for statutory or equitable implications.
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Are witnesses required for recording?
Witness requirements vary by state and by instrument type. Deeds and many conveyances require only notarization, while some states (e.g., Florida) require two witnesses for certain instruments; follow local recording rules.
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Can the option be assigned to another buyer?
Assignment depends on the option’s assignment clause. If assignments are permitted, document the transfer and confirm any required consents or notice to the seller to ensure enforceability.
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