RES exam question on Private Property Sale: Ms Siti exercised an Option to Purchase over Mr Ong's Clementi apartment on 2 October…
Ms Siti exercised an Option to Purchase over Mr Ong's Clementi apartment on 2 October 2026 by signing the acceptance copy and paying the balance of the 5% deposit. Completion is fixed for 11 December 2026. A week later she has second thoughts and asks her salesperson where she stands. Which statement is correct?
- AShe may withdraw within 7 days of exercise, forfeiting only the 1% option fee she paid at the start.
- BShe became the legal owner on exercise, so withdrawing now means transferring the unit back.
- CShe is bound by a contract of sale, and a private resale carries no statutory cooling-off period.
- DShe is not bound until her solicitor has lodged a caveat, so she may still withdraw freely.
Show answer & explanation
Answer
C. She is bound by a contract of sale, and a private resale carries no statutory cooling-off period.
Explanation
Answer: She is bound by a contract of sale, and a private resale carries no statutory cooling-off period. Exercising on 2 October made the contract.Rule: Exercise converts the option into a binding contract of sale, and there is no statutory cooling-off period for a private resale once the option is exercised. Title passes only at completion and registration of the transfer.Source: /learn/option-to-purchase-singapore
Why the other options are wrong
- Withdraw within 7 days, losing only 1%: No 7-day withdrawal right exists. If she fails to complete, the 5% deposit is at risk along with a claim for damages.
- She became legal owner on exercise: Title passes only at completion and registration of the transfer, not on exercise.
- Not bound until a caveat is lodged: A caveat protects her interest, but it is not what makes the contract binding.
Study the concept behind this question: OTP Singapore: Option to Purchase Fee, Period & Exercise
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