Contracts
What is an 'option contract' in Idaho real estate and how does it differ from a purchase contract?
AThey are the same type of contract
BAn option gives the holder the right (but not the obligation) to purchase property at a set price within a set time; a purchase contract creates a binding obligation to buy and sell✓ Correct
CAn option requires no consideration; a purchase contract requires earnest money
DAn option is used only for commercial properties
Explanation
An option contract gives the optionee the right — but not the obligation — to purchase property at a stated price during a specified period, in exchange for option consideration (payment). The seller (optionor) must sell if the buyer exercises the option. Unlike a purchase contract, the buyer can let the option expire without being in breach.
Related Idaho Contracts Questions
- What does 'mutual assent' mean in the context of an Idaho real estate contract?
- What is the legal effect of a 'waiver' in an Idaho real estate contract?
- What is a 'home inspection contingency' deadline in Idaho purchase contracts?
- What is 'undue influence' as a basis for voiding an Idaho real estate contract?
- What is the significance of an Idaho real estate contract being 'executory' vs. 'executed'?
- In Idaho, what is the 'doctrine of part performance' as it relates to oral real estate contracts?
- What is a 'liquidated damages clause' and what makes it enforceable in Idaho?
- What is an 'attorney review' contingency in an Idaho real estate contract?
Practice More Idaho Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Idaho Quiz →