Legal FAQs for REALTORS® — Contracts and Forms
Commercial Contracts

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Legal disclaimer

Is the independent consideration in TAR commercial purchase contracts refundable? (Updated Feb. 17, 2015)

No. The independent consideration paid for a feasibility period in the Commercial Contract-Improved Property (TAR 1801) and the Commercial Contract-Unimproved Property (TAR 1802) is non-refundable similar to the option money in the TREC residential sales contracts.  The buyer’s option to have an unrestricted right to terminate the contract for any reason requires independent consideration for the right to terminate.  If there is no independent consideration (or if the independent consideration is refundable) the option becomes unenforceable.  

In addition, Paragraph 7B of the commercial contracts indicates that the seller will retain the independent consideration regardless of whether the buyer exercises their right to terminate.

Legal Disclaimer: The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on Any legal or other information found here, on, or at other sites to which we link, should be verified before it is relied upon.

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