To whom should option money be delivered in a real estate transaction?

In a real estate transaction, option money is typically delivered to the seller. This money serves as consideration for the seller's agreement to provide the buyer with an option to purchase the property for a specified period. By delivering this payment directly to the seller, the buyer demonstrates their serious interest in purchasing the property, while the seller is assured that they will hold the property for the duration of the option period.

This transaction helps solidify the terms of the option agreement. The seller retains the option money as compensation for taking the property off the market during that time. If the buyer decides to exercise their option and purchase the property, the option money may be credited towards the purchase price, providing additional incentive for both parties to act in good faith during the option period.