Selling your house by owner in Texas: what you can skip and what you cannot

You can skip the agent, but not the title work

Yes, you can sell your house in Texas without a real estate agent, but in practice you still need a title company, or an attorney doing the same work, to examine the title, hold the earnest money, prepare and record the documents and disburse the money. Texas does not require title insurance, but the Texas Department of Insurance notes that a buyer's lender requires a loan policy, and almost every buyer wants an owner's policy. Most title companies, including ours, close by-owner sales routinely.

We at Capital Title work with sellers who list on their own, buyers who found a house through a neighbor, and family members selling to each other. The deals close fine when the paperwork is handled properly. They go sideways when someone assumes that because there is no agent, there is no process.

Whether the buyer is a stranger who found your listing online or a neighbor down the street in Dallas, the title work is identical. Familiarity helps the negotiation; it does not change a single step of the closing.

What the agent was doing that now falls to you

Before deciding to sell alone, be honest about the work you are taking on. A title company does not do any of these for you, because we are a neutral party and do not represent either side.

Many owners who sell on their own do it well, especially when the buyer is a neighbor, a tenant or a relative and the price is already agreed. The ones who struggle are usually surprised not by the negotiation but by the volume of dates and documents after it. If you go this route, put every contract deadline on a calendar the day you sign, and share it with the buyer.

• Setting the price and handling showings and offers
• Preparing the contract and every addendum the property needs
• Tracking deadlines for earnest money, the option period, financing, the survey and title objections
• Negotiating repairs after the buyer's inspection
• Delivering the seller's disclosure notice and any other required notices
• Keeping the buyer's lender, appraiser and inspector on schedule

The contract is where most by-owner trouble starts

Many by-owner sellers use the same contract forms agents use, promulgated by the Texas Real Estate Commission and available free on its website. The current One to Four Family Residential Contract (Resale) is long for a reason: every blank decides who pays for something or when a deadline falls.

A few of those blanks matter directly to us. Paragraph 5 requires the buyer to deliver the earnest money and option fee to the named escrow agent within 3 days after the effective date. Paragraph 6A decides whether seller or buyer pays for the owner's title policy and names the title company. Paragraph 6B gives the title company 20 days after receiving the contract to deliver the title commitment. Paragraph 6C sets out the survey options, including furnishing an existing survey with a T-47 affidavit or T-47.1 declaration.

Fill every blank deliberately. A contract with the title company left empty, or with a closing date that does not allow time for the survey and commitment, creates problems no amount of goodwill can solve later. If you are not sure what a paragraph means, that is the moment to pay a real estate attorney to review it.

What a title company handles in a by-owner sale

Once we receive the signed contract and the earnest money, a by-owner file runs the same way as any other. These are the steps we take regardless of whether an agent is involved.

One item on that list surprises sellers: the deed. A deed is a legal document, and the standard TREC contract lists preparation of the deed as a seller's expense. Title companies arrange for it to be prepared rather than handing you a blank form. Do not draft your own deed or download one from the internet and record it yourself; a defective deed creates exactly the kind of title problem the closing process exists to prevent.

• Receipt the earnest money and hold it in escrow under the contract's terms
• Examine the county records and issue the title commitment
• Order payoffs for the seller's mortgage and any other liens
• Coordinate the survey and any affidavit the contract calls for
• Arrange preparation of the deed and prepare the settlement statement
• Hold the signing, fund, disburse, record and issue the title policies

Where by-owner sales most often go wrong

The first problem is a missed deadline. Without an agent tracking dates, a buyer's option period can end unnoticed, or a seller can forget to deliver the existing survey on time. Under the TREC contract, if the seller fails to furnish both the survey and the affidavit within the agreed time, the buyer obtains a new survey at the seller's expense.

The second is a title problem nobody looked for. Agents often ask early whether the seller has refinanced, inherited the house or gone through a divorce. Sellers on their own tend to discover these issues when the commitment arrives. My guide on checking for liens before you sell shows how to look ahead.

The third is money sent or received the wrong way. Earnest money handed directly to a seller, side agreements that never reach the contract and cash exchanged outside the closing all create disputes. Every dollar that matters should go through escrow and appear on the settlement statement.

Fake buyers, fake sellers and how a closing protects you

Selling or buying without agents removes a layer of people who would normally notice something odd, which is why fraud prevention matters more, not less. TDI warns about seller impersonation fraud, which starts with someone forging documents to sell a house they do not own. Its red flags include a seller who wants only a cash buyer, will not appear for closing, insists on their own remote notary or asks for the sale money to go directly to them.

The same logic applies in reverse. If you are the seller, insist that the buyer's funds come through the title company and are confirmed before you hand over keys. TDI's own advice includes buying title insurance and using a trusted in-person notary. Before anyone wires money, read my guide on avoiding wire fraud with closing funds; criminals do not care whether there is an agent on the file.

Buyers in a by-owner purchase should take TDI's first piece of advice literally: visit the property in person and meet the owner there. Ask how the seller acquired the house and compare the answer with the deed in the county records. A real owner will not mind; a fraudster will find a reason to stay remote.

Signing day when nobody brought an agent

Closing without agents looks the same as closing with them, minus a few people at the table. The seller signs the general warranty deed and the documents needed to clear title, and the buyer signs the loan package if there is a loan. The TREC contract requires the buyer to pay the sales price in good funds acceptable to the escrow agent. We disburse after funding, record the deed with the county and issue the policies.

Buyers and sellers often sign at separate appointments, which can be easier when there are no agents to keep conversation on track. My walkthrough of the closing appointment and what to bring covers identification, funds and what to expect in the room.

Without agents, someone still has to handle the details agents usually take care of: confirming the final walkthrough happened, agreeing on when keys and garage remotes change hands, and making sure utilities are transferred. Settle those between buyer and seller in writing before closing day, so the signing can focus on the documents.

When it is worth paying a lawyer

A title company is neutral. We follow the contract and the requirements of the title policy, but we cannot advise either side on what the contract should say or whether a deal is fair. If you are selling without an agent, consider having a real estate attorney draft or review the contract and addenda, especially for a sale to a relative, owner financing, a property with tenants or anything unusual about the land.

The standard TREC contract itself includes a notice advising the buyer to have the title commitment reviewed by an attorney because of the time limits on objections. That advice applies with even more force when no agent is reading the commitment alongside you.

Sales between family members deserve special mention. A sale to a child or sibling below market value can have tax consequences, and seller financing carries its own legal and lending rules. Bring in a real estate attorney for the documents and a CPA for the tax side before anything is signed, then send us the contract so we can tell you what the title company will need.

Opening a by-owner file with us

If you have a buyer and a signed contract for a home in Dallas, Highland Park, University Park or Preston Hollow, send us the executed contract and have the buyer deliver the earnest money to our office at Preston and Lovers. We will open the file, introduce your escrow officer and send the commitment once the examination is complete.

If you do not have a contract yet, call before you sign one. We cannot negotiate for you, but we can tell you what we will need to close, how long the title work usually takes in your situation and which blanks in the contract affect us. That ten-minute conversation prevents most of the problems described above.

Questions people ask me