Option Agreements
An option agreement is a contract that gives one party the right, but not the obligation, to buy or sell an asset—such as real estate or stock—at a specified price within a certain time frame. This means the buyer can decide later whether to proceed with the purchase, while the seller is generally obligated to complete the sale if the option is exercised. Option agreements are often used in real estate and business transactions to secure a potential deal while allowing flexibility. They can protect interests for both parties during negotiations or when assessing market conditions.
Additional Insights
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An option agreement is a contract that gives one party the right, but not the obligation, to buy or sell an asset at a specified price within a certain time frame. In real estate, for example, a buyer may secure the right to purchase a property while the seller agrees not to sell it to anyone else during that period. This allows the buyer time to arrange financing or conduct due diligence, while the seller receives a fee for granting that option. If the buyer decides not to proceed, they can walk away without further obligation.