How to Buy a Home in Texas: A Step-by-Step Guide

Written By Carissa Holmes

Buying a home is one of the biggest financial decisions you will ever make. In Texas, the process comes with unique rules and timelines. Whether you are a first-time buyer or a seasoned homeowner relocating to the Texas Hill Country, this guide walks you through every step of the process with insights tailored to the Dripping Springs and Driftwood markets.

Interview and Hire Your Agent (hi!)

As of August 2024, Texas law requires buyers to sign a Buyer Representation Agreement before touring homes or submitting offers.

Why This Matters:
This agreement ensures your agent (me, if you choose) works solely in your best interest, negotiating on your behalf and providing full market access, including off-market opportunities.

Questions to Ask When Interviewing Agents:

  • Experience in your target neighborhoods

  • Access to off-market listings

  • Negotiation strategies in competitive markets

Get Pre-Approved for a Mortgage

Before scheduling showings, most sellers and many agents will expect you to provide proof of financing.

How to Get Pre-Approved:

  • Gather documents such as W-2s, tax returns, bank statements, and pay stubs.

  • Speak with a local lender. I maintain a vetted list of professionals familiar with Texas programs including USDA, VA, FHA, DSCR, and bank-statement loans.

  • Obtain a pre-approval letter specifying your budget and loan type.

Define Your Needs and Wants

Get clear about your priorities before touring homes, typically my clients see no more than 4 homes prior to make a decision followed by a compelling offer.

Considerations:

  • Location: School districts, neighborhoods, or subdivisions such as Rim Rock, Headwaters, or Parten Ranch

  • Home Features: Bedrooms, bathrooms, square footage, one or two stories, garage spaces, lot size

  • Budget: Include closing costs, inspection fees, and moving expenses in addition to the purchase price

Step 4: Start Touring Homes

With your pre-approval in place, I will set up a custom MLS search with real-time updates.

Touring Tips:

  • Take videos and narrate your impressions for easy comparison later.

  • Look past cosmetic issues like paint or flooring, which are inexpensive to change.

  • Ask about HOA rules, tax rates, and MUD or PID districts, which are common in Hays County.

Make an Offer

Once you find the right home, we will prepare an offer using the standard TREC One to Four Family Residential Contract.

Key Negotiation Factors:

  • Offer price

  • Buyer’s agent compensation (BAC)

  • Option fee and earnest money

  • Closing timeline and seller concessions

Pro Tip: In competitive markets, a shorter option period or higher earnest money deposit can strengthen your offer.

Deliver Earnest Money and Option Fee

Once the contract is executed:

  • Earnest Money: Typically 1–2% of the purchase price, held by the title company

  • Option Fee: Paid directly to the seller for the option period, giving you the right to cancel for any reason

  • Deadline: Both must be delivered within three days of contract execution

Inspection and Option Period

The option period usually 10 days. Use this time to thoroughly evaluate the property, this is a busy time and you need to make yourself as available as possible for questions and decisions and be made aware of important information. I strongly suggest you have a note taking and recording app on your phone. Record the important conversations so you can refer back to them later if needed, I suggest always letting the other person know you are recording. To this day, I have never had someone object.

Recommended Inspections:

  • General home inspection

  • Termite inspection

  • Septic or well inspection (if applicable)

You can negotiate repairs or credits based on inspection results.

Title Commitment and HOA Documents

The title company will provide:

  • Title Commitment: Confirms there are no liens or disputes on the property

  • HOA Documents: Outline rules, fees, and restrictions

Review these carefully before moving forward.

Appraisal and Underwriting

Your lender orders the appraisal to verify the property’s value. At the same time, underwriting confirms your financials, employment, and income.

Pro Tip: Do not make large purchases or open new credit accounts until after closing.

Clear to Close

Once the loan is approved:

  • The title company prepares your Closing Disclosure (CD)

  • Review your loan terms, down payment, and closing costs

  • Arrange for a wire transfer or cashier’s check for closing funds

Final Walkthrough

Conducted 24–48 hours before closing to ensure:

  • Repairs have been completed

  • The home is in the same condition as when you signed the contract

If repairs are incomplete, your agent can negotiate solutions before funding.

Closing Day

At closing:

  • Sign your documents at the title company, or remotely if available - I work with multiple title companies that are willing and able to come to you to make closing even easier!

  • The lender wires funds, and the deed is recorded with the County Clerk

  • Once the funds have cleared in the sellers account which can take up to a full 24 hours and will not happen on a holiday - I, personally, learned this the hard way long before I was a licensed Real Estate Agent - you will receive keys and access codes to your new home! Yay!

After Closing

  • File your homestead exemption with Hays County to save on property taxes (I send my clients reminders each year to ensure this is filed).

  • Update utilities, mailing addresses, and HOA registrations.

  • Store all documents securely, ideally outside of your home.

Carissa Holmes
Next

Buyers: Interview agents