The Washington Bullets, who have been having more than their share of problems on the court this year, apparently face some offcourt difficulties, too. Forward Mitch Kupchak and guard Kevin Grevey both are in the last year of their contracts, and forward Greg Ballard has one year remaining on his.

Under the agreement reached between the National Basketball Association and the players' association at the time of the NBA-American Basketball Association merger in 1976, there will be no more option years on contracts signed after this season ends.

That means Kupchak and Grevey will become free agents if not resigned by then and Ballard will become a free agent at the end of next season.

Also beginning with the end of this season, no compensation will be awarded a team that loses a free agent to another club. The only protection the old team will be given will be the right of first refusal, meaning that if it matches the best of the other offers it can keep the player.

Grevey, the Bullets' second-leading scorer and the league's top three-point field goal shooter, tested the free agent market two years ago. But because the compensation rule still was ineffect, no other teams tried to sign him and he settled for a two-year contract with the Bullets.

Kupchak didn't want to comment on his contract, but it was learned that the New York Knicks would be interested in signing him after the end of the season.

"We'd like to have him (Kupchak) signed, but we haven't started any talks yet," said Bullet General Manager Bob Ferry.

Ferry said he still is discussing a number of trade possibilities. "We have feelers out everywhere and something could happen," he said, "but right now we don't have any trades going."

Whenever the Bullets talk trade, Kupchak, Ballard and Grevey are three names that come up almost automatically. They also are the nucleus of the future and the team cannot afford to lose any of them without getting something substantial in return.