Buying a House As Is in Texas: 6 Ways to Protect Yourself

Plenty of Texas buyers look at a house listed "as is" and wonder whether they are signing up for a gamble. They aren't, if they know what the phrase means and what protections stay in place. Buying a house as is in Texas still lets you inspect it, review the seller's disclosure, check the title and negotiate. Here are the six steps I tell my buyers to take, starting with what "as is" really means in the standard Texas contract.

Most resale transactions in Texas use the One to Four Family Residential Contract (Resale) from the Texas Real Estate Commission (TREC). In that form, "as is" means the present condition of the property, with any and all defects, and without warranty except the warranties of title and the warranties written into the contract.

Here is the key point: the form says that accepting the property as is does not stop you from inspecting it, negotiating repairs in a later amendment, or terminating the contract during the option period, if you have one. So "as is" describes the seller's position on repairs. It does not take away your right to find out what you are buying. Some buyers also agree to "as is" with specific repairs the seller will complete, and the form asks that those repairs be listed by name, not in general phrases.

Can I still get an inspection on an as-is house in Texas?

Yes. The TREC contract says accepting the property as is does not preclude you from inspecting it, negotiating repairs in an amendment, or terminating during the option period.

What is the option period?

It is a negotiated number of days during which you can terminate the contract for any reason, in exchange for an option fee. If you terminate on time, you lose the option fee, but your earnest money is refunded.

Does the seller have to give me a disclosure notice?

Many sellers must, under Texas Property Code Section 5.008, but some are not required to. The contract has a box for that case. If a required notice was not delivered, the contract gives you a right to terminate.

Can I use a loan on an as-is home?

Often, yes, but the property has to meet the loan program's requirements, and some homes need repairs first. A renovation loan is one option. Talk to me before you make an offer so we can match the loan to the house.