When negotiating residential real estate contracts in Texas, it’s important to understand the timelines and deadlines involved in real estate contracts—especially if you’re using the standard TREC (Texas Real Estate Commission) One to Four Family Residential Contract. There can be some confusion on how to properly count days in the contract. This article will discuss the correct method for computing time in TREC real estate contracts.
Day Zero: What Is the Effective Date?
In TREC contracts, the effective date is the starting point for all deadlines. It’s typically located at the end of the contract and is the date when both parties have signed and initialed all required pages. However, the key thing to remember is you don’t count the effective date as part of the contract’s timeline. That day is considered Day Zero.
How to Count the Days Correctly
Once you’ve identified the effective date, you begin counting the day after. So if your effective date is March 1st, Day 1 is March 2nd. This applies to any timeframes laid out in the contract, whether it’s the option period, financing period, or other contingencies.
For example, if you have a 10-day option period, you would count 10 days starting after the effective date. So again, if the effective date is March 1st, the option period would end at 5:00 PM on March 11th.
Option Period Deadline: Don’t Miss 5:00 PM
Buyers and sellers are most often concerned with the expiration of the option period in the TREC contract. When a buyer wants to terminate the contract during the option period, they must provide written notice of termination by 5:00 PM on the last day of the option period. Missing this deadline—even by a few minutes—could mean the buyer loses their unrestricted right to terminate the contract.