The Chelsea captain has 14 days to make a decision and the publication of the full judgement by the FA regulatory commission appears to have diminished the likelihood of that happening.
The commission described the Chelsea captain's defence as "improbable, implausible and contrived".
The commission said there was "no credible basis" for Terry's claim he had only been repeating words he thought QPR defender Ferdinand had accused him of saying during the match at Loftus Road last October.
The commission said they were satisfied the words "f****** black c***" were intended as an insult by Terry.
The commission's report stated: "There are further aspects of Mr Terry's defence that the commission finds improbable, implausible and contrived, and which serve to underline and reinforce our decision.
"The commission is quite satisfied, on the balance of probabilities, that there is no credible basis for Mr Terry's defence that his use of the words 'f****** black c***' were directed at Mr Ferdinand by way of forceful rejection and/or inquiry.
"Instead, we are quite satisfied, and find on the balance of probabilities, that the offending words were said by way of insult.
"Accordingly, the commission finds that there is 'clear and convincing' evidence'."
The commission said that character references from a number of people, including black players, made it clear that Terry was not racially prejudiced.
"It is accepted by everyone involved in the criminal and disciplinary proceedings that Mr Terry is not a racist," added the commission.
Terry had been cleared in Westminster magistrates' court in July of a racially-motivated public order offence, partly helped by the testimony of Ashley Cole.
However, the commission found that there were discrepancies in Cole's initial statement to FA interviewers of what he heard Ferdinand say to Terry compared to later statements.
There will also be questions for the FA to address in relation to how they investigate such serious cases.
The written reasons show that FA interviewers did not record an interview with Cole, who was a key witness, but relied on written notes.
The notes by one of the two interviewers were initially omitted from the FA's dossier of relevant documents and only came to light just before the hearing.