Texas has laws in place to protect homebuyers and sellers, as well as those who may be losing their homes due to foreclosure or divorce. Here’s what you need to know if you’re considering buying a home in Austin.
Home seller and buyer laws
All Texas home sellers are required to disclose any issues with a home. Texas law requires sellers to provide written notice that covers all aspects of the property. Anyone with a real estate license in Texas must ensure that sellers use the seller’s disclosure notice provided by the Texas Real Estate Commission, which meets the disclosure requirements under Texas state law.
When the time comes for you to close on your home, you aren’t required to have an attorney present, as Texas is an escrow state. Although not required, homebuyers may want to use an attorney for particularly complex situations.
Most Texas foreclosures are non-judicial, which means the lender can foreclose on your home without going to court. Your lender must give you at least 20 days to bring your mortgage up to date and an additional 21 days notice before your home is sold at auction. If the deed of trust does not contain a “power of sale” clause, which authorizes a non-judicial foreclosure, a lender must file a lawsuit to foreclose on the home.
Texas is a community property state. This means that, in the event of a divorce, everything acquired during the marriage is considered “community property” and divided equally between the two spouses. However, the judge does have some discretion to ensure the split is fair; so although community property is typically divided 50/50, it doesn’t always have to be.
If you’re buying a home in Austin, one thing you don’t have to worry about is paying a transfer tax. Texas is one of the few states without a transfer tax. You do have to pay property taxes, though. Austin is the county seat of Travis County, which collects a median property tax of $3,972 per year, according to Tax-Rates.org. This is higher than the statewide median of $2,275 annually.
Travis County does offer several property tax exemptions, which can reduce your property taxes. These include:
- A homestead exemption for owner-occupied properties
- An over-65 homestead exemption for those age 65 and older
- An over-65 and disabled deferral
- An over-55 exemption for the surviving spouse of someone who qualified for the over-65 exemption
- A 100% disabled veteran exemption
- A disabled veteran or surviving spouse of a disabled veteran exemption
- A disability homestead exemption
To apply for an exemption and find out more information, contact the Travis Central Appraisal District.
Conforming loan limits
A conforming loan limit is the maximum loan amount that government-sponsored entities Fannie Mae and Freddie Mac will purchase. The Federal Housing Finance Agency sets these loan limits each year.
Travis County, where Austin is located, has a conforming loan limit of $484,350. Some pricier areas in the U.S. qualify for higher loan limits, but Austin doesn’t meet the criteria.