Although the initial option fee should be sent to the title company, the fee to extend the termination option should be delivered directly to the seller.
Paragraph 6 on the Amendment form states, “Buyer has paid Seller an additional Option Fee… .” Because this language is in the past tense, it assumes that the additional option fee was paid to the seller before the amendment was signed. The amendment acts more like a receipt.
How Much Should the Fee to Extend the Option Fee Be?
The fee to extend the option period is a negotiable amount between the buyer and seller. There is no minimum or maximum amount. However, buyers should not enter $0 to extend the option period. If no money is paid, the buyer runs the risk that the option to terminate would not be enforceable. No matter how small the amount the parties agree to, the buyer should pay the seller. Failing to do so opens the door for the seller to claim the buyer did not fulfill the contractual obligation necessary to extend the option period.