A real estate closing attorney in Austin reads the contract’s deadlines before anything else, because Texas resale deals usually collapse over a missed date, not a disagreement. Under the TREC resale contract, earnest money and the option fee are due within three days, the option period is the buyer’s only free exit, and a seller gets fifteen days to cure a title objection. Here’s the calendar of a Travis County resale, in the order the dates arrive.
What follows walks the calendar of a Travis County resale. The dates appear in the order they actually arrive, with the ways each one can end a deal.
Day Three: Earnest Money and the Option Fee
Paragraph 5.A gives the buyer three days from the effective date. Earnest money and the option fee both go to the escrow agent. The option fee credits toward the sales price at closing. Paragraph 5.C supplies the consequence of missing it. Miss it, and the seller may terminate or pursue the remedies in Paragraph 15.
Paragraph 5.D adds a trap that catches buyers every season. Leave the option fee amount blank, or pay it late, and the buyer simply has no unrestricted termination right. The option period still appears on the page. It just does not work.
The Option Period Is the Only Free Exit
Paragraph 5.B gives the buyer an unrestricted right to terminate for any reason during the option period. Notice must land by 5:00 p.m. local time on the final day. Nothing else in the contract works that way. Every other exit requires a condition to fail.
Inspections belong here. So does a second reading of the seller’s disclosure notice. Paragraph 7.B separately allows termination within seven days of receiving a late notice.
Title Objections, a Fifteen-Day Cure, and Five Days to Decide
Paragraph 6.A commits the seller to an owner title policy in the amount of the sales price. Eight enumerated permitted exceptions apply. Paragraph 6.C covers the survey. Then comes 6.D, the objection process, and the place where a real estate closing attorney in Austin earns the fee.
The buyer must object by the earlier of two dates. One is the closing date. The other falls a stated number of days after the commitment, exception documents, and survey arrive. Failing to object waives the objection. Once the buyer objects, the seller gets a fifteen-day cure period. If the defect survives the cure period, the buyer gets five more days. Terminate with the earnest money refunded, or waive and proceed. Nobody sends a reminder.
Financing, and the Addendum That Governs It
Financing contingencies live in a separate document, not the body of the contract. The current Third Party Financing Addendum is Form 40-11, effective January 3, 2025. It defines approval, sets what the buyer must do to pursue it, and fixes the deadline for terminating when approval never comes.
Appraisal terms have moved between forms across recent TREC cycles. Confirm which addendum version the parties actually signed rather than assuming the version from a prior deal still applies.
Closing Day, and the Seven-Day Slide
Paragraph 9.A sets closing on or before the stated date. Alternatively it falls within seven days after 6.D objections are cured or waived, whichever comes later. A title objection therefore does not just start a cure clock. It can also move closing.
Paragraph 9.B defines what actually has to happen. The seller delivers a general warranty deed. Good funds acceptable to the escrow agent must cover the sales price. Insurance Code Section 2652.004 backs that up. An escrow officer may not disburse until sufficient good funds have arrived and been deposited.
Default: Specific Performance or the Earnest Money
Paragraph 15 is a mirror image. A defaulting buyer leaves the seller three choices. Enforce specific performance, seek other relief, or both. Alternatively, terminate and keep the earnest money as liquidated damages. A defaulting seller hands the buyer the same menu.
Specific performance is harder than the sentence suggests. In DiGiuseppe v. Lawler reached the Texas Supreme Court in 2008. A party seeking specific performance must plead and prove readiness, willingness, and ability to perform on time. A pleading alone does not establish it, and where the point is disputed the party must obtain a jury finding. Repudiation by the other side excuses tender but not proof of ability.
The Earnest Money Standoff a Closing Attorney in Austin Untangles
Escrow agents do not referee a fight. A real estate closing attorney Austin parties retain at this stage is usually there to break the deadlock. Paragraph 18.C lets either party send a release. Where one side will not sign, the other may make written demand on the escrow agent. The agent promptly copies the other party. Absent a written objection within fifteen days, the agent may disburse to the party who demanded, less unpaid expenses.
Paragraph 18.D is the pressure point. Any party who wrongfully fails or refuses to sign a release acceptable to the escrow agent within seven days of receiving the request becomes liable to the other party for damages, the earnest money, reasonable attorney’s fees, and all costs of suit. That is not a treble-damages clause. It is worse in a small dispute, because the fees and costs frequently exceed the money being fought over.
Mediation, Fees, and Where the Suit Goes
Paragraph 16 sends unresolved disputes to a mutually acceptable mediator, with costs split equally. It still preserves the right to seek equitable relief in court. Paragraph 17 awards reasonable attorney’s fees and all costs to whichever of the buyer, seller, brokers, or escrow agent prevails.
Deadlines outside the contract apply too. Business and Commerce Code Section 26.01(b)(4) requires a contract for the sale of real estate to be in writing and signed. Civil Practice and Remedies Code Section 16.004(a)(1) gives four years to sue for specific performance of a conveyance contract. Travis County has twelve civil district courts. Cases involving title to land sit squarely inside their jurisdiction. Arizona resolves the same standoff on different terms, as our guide to breach of an Arizona real estate contract describes.
The Bottom Line
The TREC contract is a well-drafted instrument that assumes somebody is reading the calendar. Most failed closings trace back to a waived objection, a blank option fee, or a release nobody would sign. None of those are close legal questions. They are missed dates, and the remedy for a missed date is usually nothing at all. The cheapest legal help in a Texas resale is an hour spent on the commitment and the survey during the option period, while every exit in the contract is still open.
Frequently asked questions
Paragraph 5.C lets the seller terminate or pursue the Paragraph 15 remedies. A blank or late option fee separately eliminates the unrestricted termination right under Paragraph 5.D.
Fifteen days under Paragraph 6.D. If the objection is not cured, the buyer has five days after that period to terminate with the earnest money refunded, or to waive and proceed to closing.
Paragraph 18.D makes a party who wrongfully refuses to sign a release within seven days of the request liable for damages, the earnest money, reasonable attorney’s fees, and all costs of suit.
No. In DiGiuseppe v. Lawler the Texas Supreme Court held that a party seeking specific performance must plead and prove readiness, willingness, and ability to perform, and must obtain a finding where the point is disputed.
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Get MatchedKeep reading: Breach of Real Estate Contract Arizona: Earnest Money and Specific Performance · Title Insurance Arizona: What a Policy Actually Covers After Closing
This article is for general informational purposes only and does not constitute legal advice. Contract deadlines depend on the specific form and the blanks the parties filled in, and TREC revises its promulgated forms periodically. Anyone facing a failed or disputed closing should consult a licensed Texas real estate attorney.
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