Getting Pre-Approved
Before you start shopping for homes, getting pre-approved for a mortgage is essential. Pre-approval tells you exactly how much house you can afford and shows sellers that you're a serious, qualified buyer.
What You'll Need
- Recent pay stubs (last 30 days)
- W-2 forms from the past two years
- Tax returns from the past two years
- Bank statements (checking, savings, investments)
- Photo ID and Social Security number
- Employment verification letter (if applicable)
Understanding Your Budget
Most lenders recommend keeping your total housing costs (mortgage, taxes, insurance) under 28% of your gross monthly income. Remember to factor in additional costs like HOA fees, maintenance, and utilities.
Get pre-approved with 2-3 different lenders to compare rates and terms. This won't significantly impact your credit score if done within a 45-day window.
Finding the Right Agent
A great real estate agent is your advocate, negotiator, and guide throughout the home buying process. In Texas, buyer's agents typically don't cost you anything directly - the seller pays the commission.
What to Look For
- Local expertise: Knowledge of your target neighborhoods and market conditions
- Experience: Track record of helping buyers similar to your situation
- Communication: Responsive and keeps you informed throughout the process
- Professionalism: Licensed, ethical, and operates under brokerage supervision
- Technology: Uses modern tools to streamline your search and paperwork
Questions to Ask
- How long have you been working in this market?
- How many buyers did you help last year?
- What's your communication style and availability?
- Can you explain the buying process from start to finish?
- Do you have references from recent buyers?
Interview at least 2-3 agents before choosing one. Chemistry matters - you'll be spending a lot of time with this person!
Searching for Homes
Now the fun begins! Work with your agent to define your must-haves and nice-to-haves, then start viewing properties that match your criteria.
Define Your Priorities
- Location: Commute time, school districts, neighborhood safety
- Size: Bedrooms, bathrooms, square footage
- Features: Garage, yard, updated kitchen, specific layouts
- Condition: Move-in ready vs. willing to renovate
- Budget: Stay within your pre-approved amount
During Showings
- Take photos and notes for each property
- Open cabinets, closets, and check water pressure
- Look for signs of water damage, foundation issues, or pest damage
- Visit the neighborhood at different times of day
- Consider future resale value
Don't fall in love with the first house you see. View at least 5-10 properties to understand what's available in your price range and to calibrate your expectations.
Making an Offer
When you find "the one," it's time to make an offer. Your agent will help you craft a competitive offer based on market conditions and comparable sales.
Key Components of an Offer
- Purchase price: Based on comparable sales and market conditions
- Earnest money: Typically 1-3% of purchase price, shows you're serious
- Option period: Time to conduct inspections (typically 7-10 days in Texas)
- Financing contingency: Protection if your loan falls through
- Closing date: When you'll officially take ownership
- Inclusions: Appliances, fixtures, or other items to include
Texas-Specific Considerations
In Texas, the standard contract includes an "option period" where you pay a small fee (typically $100-$500) for the right to terminate the contract for any reason. This is your due diligence period for inspections.
In competitive markets, consider writing a personal letter to the sellers explaining why you love their home. Sometimes it's not just about the highest price.
Under Contract
Congratulations - your offer was accepted! Now begins the escrow period where several important things happen simultaneously.
Inspections
Schedule a general home inspection immediately. Consider additional inspections for:
- Foundation (especially important in Texas clay soil)
- Roof condition
- HVAC systems
- Pool and spa (if applicable)
- Termite/pest inspection
- Septic system (if not on city sewer)
Appraisal
Your lender will order an appraisal to ensure the home is worth the purchase price. If the appraisal comes in low, you may need to renegotiate or bring additional cash to closing.
Final Loan Approval
Work closely with your lender to provide any additional documentation they need. Avoid making major purchases or changing jobs during this time - it can affect your loan approval.
Don't skip the inspection to win a competitive bid. Major issues can cost tens of thousands of dollars. Your agent can help you make smart decisions about what to negotiate.
Closing Day
The finish line is here! Closing day is when you sign all the final paperwork, transfer funds, and get the keys to your new home.
Before Closing
- Do a final walkthrough of the property (usually 24-48 hours before)
- Verify repairs were completed (if negotiated)
- Review your Closing Disclosure - compare to Loan Estimate
- Wire your down payment and closing costs (beware of wire fraud!)
- Get cashier's check if required for any portion
At Closing
- Bring valid government-issued photo ID
- Review and sign all documents carefully
- Receive copies of all signed documents
- Get the keys and garage door openers
- Celebrate - you're a homeowner!
Typical Closing Costs
Expect to pay 2-5% of the purchase price in closing costs. This includes loan origination fees, title insurance, escrow fees, prepaid taxes and insurance, and more. Your Closing Disclosure will itemize all costs.
Wire fraud is real. Always verify wiring instructions by calling a known number (not one from an email). Scammers intercept emails and provide fraudulent wiring instructions.