Lo Celso spent last season on loan at Villarreal and the midfielder is pushing for a return to the Spanish club this summer.
Villarreal have been locked in talks with Tottenham as they look to take him back to the Estadio de la Ceramica ahead of the end of the window.
A loan deal is being discussed but Tottenham were believed to be pushing to include an obligation to buy as part of the agreement.
But according to Argentine sports channel TyC Sports, Spurs have now backed down from that demand during negotiations.
The Spanish club were clear about not wanting such a clause and it was an issue during the talks.
A simple loan deal is now under consideration, but talks are still ongoing on whether Villarreal could have an option to buy.
If there was no option to buy, other clubs could join the bidding for Lo Celso next summer.
The two clubs have continued to hold negotiations and there is now hope that a loan agreement will be finalised soon.
Lo Celso was impressive at Villarreal last season but has not been part of Antonio Conte’s plans.