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5 Tips for Navigating the Home Buying Process in Texas

Updated: Apr 19, 2022

The home-buying process often feels like it’s filled with an endless number of steps, which can be equally exciting and intimidating. Although identifying your must-have features in potential homes and neighborhoods can be fun, other aspects—such as putting your finances in order—might be less so. Luckily, you don’t have to go through this process alone.

Although partnerships with realtors, inspectors, and lenders offer immense help throughout this process, it’s good to know what to expect on your end. To help you out, this article walks through the home-buying process in Texas from start to finish, highlighting key moments, potential challenges, and tips for a successful path.

Why Buy a Home in Texas?

According to the 2021 Texas Relocation Report, Texas is seeing significant changes to its population:

  • Texas welcomed 537,000-582,000 new residents in 2019 alone.

  • This is the seventh year in a row that Texas attracted more than 500,000 new residents from out of state.

  • Texas ranked second in the nation for relocation activity in 2019.

What’s causing this migration? If you’re native to Texas, you’re already aware of the many benefits the state has to offer, from the growing job markets to the cheaper housing costs to the tax incentives. Plus, Texas provides an option period on home purchases. This is an agreed-upon period after the contract is signed in which the buyer can terminate the contract for any reason, without risking monetary loss.

According to a recent article from the Texas Real Estate Research Center, the state has seen an increase in construction permits, housing sales, and housing prices, which is favorable for those hoping to see a return on investment further down the line.

Based on the state’s expanding economy, favorable business policies, and consistent population growth, now is a great time to invest in the Texas housing market.

Navigating the Home-Buying Process in Texas

Now that you know the benefits of living in the Lone Star State, let’s go over some tips for navigating the home-buying process in Texas.

  1. Take a homebuyer class.

It is highly recommended that all future homebuyers take a homebuyer education course to become more informed. In these courses, students are given information on a variety of topics related to the home-buying process, including:

  • Money management and range of affordability

  • Loan eligibility based on credit

  • Recommended down payment percentages and closing cost requirements

  • Mortgage applications and home offers

  • Home shopping, inspection, closing, and post-purchase responsibilities

You can also utilize other local resources—such as the Texas Financial Toolbox—to learn more about the basic requirements of homeownership in Texas.

2. Get your finances in order.

Perhaps the most crucial element of the process is understanding the quality of your financial situation. Be sure to know the answers to the following questions:

  • Is your credit score poor, good, or excellent? (This helps determine your loan eligibility.)

  • Is your down payment going to allow for a monthly payment you can afford?

  • Do you have enough savings to cover closing costs and maintenance fees?

  • What is your debt-to-income ratio? (This helps determine what you can afford in monthly payments.)

3. Obtain pre-approval for a mortgage loan.

Once you have your finances in order, get in touch with a Loan Officer from an independent mortgage bank (IMB) to understand how much you can afford and which loans you qualify for. An IMB is an excellent option because they provide hundreds of loans, lower interest rates, and faster closings.

4. Partner with a real estate agent.

It’s important to establish a professional relationship with a well-informed real estate agent. Not only will they help you find the right home and neighborhood based on your must-haves and lifestyle, but they will also help create and submit proposals to the seller specifying the purchase price, terms, and conditions.

5. Apply for a mortgage loan and close.

Once you have had your home inspected to ensure there are no significant issues, you can reconnect with a Loan Officer who will provide conventional loans, federal loans, or other loans depending on your financial situation. After the seller receives the funds, you will receive the deed and keys. Congrats! It’s time to start making your house your home.


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