Option To Purchase (OTP)
When the price is right, issue the OTP to your buyer who needs to pay you the Option fee!
Find out how to fill up the OTP here.
If you decide to sell your property at the agreed sale price, you may grant an Option to the buyers.
You are required to sign on the OTP in exchange for an Option Fee from the buyers. The Option Fee is 1% of the sale price.
Once you have granted the Option to the buyers, you cannot grant an Option to another buyer until it expires.
The Option period is usually 14 calendar days (including Saturday, Sunday and public holidays) from the date of granting the OTP. It expires at 4pm on the 14th calendar day.
If the buyers wish to purchase your house, they have to exercise the Option within the Option Period at their law firm. To exercise the Option, the buyers must sign on the "ACCEPTANCE" section in the OTP.
When the buyers exercise the OTP at their law firm, the buyers will pay the Option Exercise Fee (4% of sale price) to your law firm to be held by your lawyer as stakeholders pending completion. The Option Fee (1%) and Option Exercise Fee (4%) forms the deposit (5%).
If the buyers do not wish to proceed with the purchase, that is, exercise the OTP, you need not do anything but wait for the Option Expiry Date to lapse. The Option Fee (1%) will be forfeited by you and you may keep the Option Fee.
A valuer will arrange with you to view and conduct a valuation of your house when the buyer has accepted the bank loan, if any. This is part of the formality of the bank when disbursing loan to buyer. This cost is borne by the buyer.