Valuable consideration paid to an optionor to secure the right.

• A. Option money
• B. Earnest money
• C. Purchase price
• D. Commission

Answer: (A)

The key idea is the term used for money paid to grant a limited-time right to buy. When someone pays to secure an option on a property, that payment is called option money. It acts as consideration to the seller (optionor) for keeping the option open for the buyer (optionee) for a set period. Earnest money is a separate deposit tied to a purchase contract and is typically applied to the price if the option is exercised; purchase price is the amount paid to buy the property itself, not the fee to secure the option; and commission is the broker’s fee, not the payment for the option itself. So the payment to secure the right is option money.