12 Mistakes First-Time Homebuyers in Texas Make And How to Avoid Them

Buying your first home in Texas should be exciting—not overwhelming. But if you’re like most first-time homebuyers in Austin, Dallas, Houston, or San Antonio, the process can quickly become a confusing web of credit scores, down payments, contingencies, and bidding wars.

At LendFriend Mortgage, we’ve helped hundreds of first-time buyers across Texas navigate this journey with clarity and confidence. We've also seen the common pitfalls that cost people time, money, and missed opportunities.

Below are the most frequent mistakes Texas homebuyers make—and the strategic moves you can take to avoid them.

1. Mistake: Skipping mortgage preapproval (or prequalification) before house hunting in Texas

Some buyers begin touring homes before they’ve spoken to a lender, assuming they’ll qualify later. But in no one other than a very desperate seller is accepting an offer from a buyer that doesn't have proof of financing or proof of funds for cash offers.

Imagine you fall in love with a home, whether it's in Cedar Park or East Austin. It's perfect—great price, walkable location, and renovated exactly how you like. But without preapproval, you can't make an offer, and by the time you're able to get preapproved, the home is already under contract with someone else.

Solution: A verified preapproval or prequalification should be your first step. This means having a lender determine your eligibility and tell you exactly what the top end of your budget is. At LendFriend, we can preapprove you in as little as 24 hours, so you can shop with confidence. 👉 Start your preapproval here

2. Mistake: Ignoring your credit score—or damaging it mid-process

Your credit score directly impacts your interest rate and eligibility. We’ve seen buyers lower their score between preapproval and closing by opening a new credit card, missing a credit card payment, or making a large purchase on a car.

A borrower preapproved with a 700 credit score for a conventional loan is in for a very rude awakening if their score were to drop to 648. Not only would they lose access to the conventional program and have to switch to FHA, but now their subject to a higher rate and a higher PMI for the life of the loan—costing them $150 more per month.

Solution: Check your credit at least 60 days before applying and avoid any financial changes once you’re under contract. LendFriend provides free credit reviews to help clients optimize scores before locking a rate. 👉 Here's some easy ways to raise your credit score

3. Mistake: Only getting one mortgage quote instead of shopping rates in Texas

Too many buyers go with the first lender who approves them without checking whether they’re getting the best rate or fees. But mortgage pricing varies daily—and lender to lender. One borrower we met was quoted a 6.5% interest rate with $3,500 in closing costs. After his realtor received our Friday rate text, she quickly introduced hime to us and we secured the borrower a 6.25% rate with a $1,500 lender credit. That’s a $5,000 swing upfront—not to mention the monthly savings on a lower rate. Over five years, that difference added up to over $10,000 saved.

Solution: Don't be afraid to reach out to multiple lenders for a quote. Work with a mortgage broker who can compare options across dozens of lenders. LendFriend ensures you get competitive pricing and access to programs that many retail banks don’t offer. 👉 Questions to ask your lender to make sure you're getting a great deal

4. Mistake: Buying too much house (House Rich/Cash Poor)

Getting preapproved for $500,000 doesn’t mean you should spend $500,000. A preapproval tells you the absolute highest amount that you can spend on a house and still qualify for the mortgage, but qualifying and comfortably affording are 2 separate things. We had one client bought a home at the top of their budget, but what they failed to realize it that it didn't leave them with enough room to buy furniture or enjoy their lifestyle before owning a home. PLUS, they were even more stressed when their taxes and insurance started creeping up.

Solution: Set your budget based on your monthly payment goal—not just your max approval. In Texas, local tax rates can make a huge difference. We walk every client through an all-in cost estimate—including HOA dues, insurance, and utilities—to ensure the purchase is sustainable. 👉 Use our mortgage calculator

5. Mistake: Underestimating the true cash needed to close

Down payment isn’t the only cost. We’ve had buyers caught off guard by title fees, lender fees, escrow reserves, inspection fees, and prepaid taxes. Couples might find themselves pulling from their retirement because they worked with a lender who didn't let them know about all the costs associated with buying a home.

Solution: Always ask for a Loan Estimate before making an offer. We provide side-by-side breakdowns and explore every way to reduce your upfront cost—whether that’s through seller credits, grant programs, or negotiated rate structures. Plus, you can always try to lower your cash to close by negotiating for seller concessions.  👉 Explore first-time buyer programs

6. Mistake: Waiving the home inspection to win in a bidding war

In houses in Austin that have multiple offers, some buyers try to strengthen their offer by skipping the home inspection. But doing so can open the door to massive financial risk. We’ve seen buyers move forward on homes that looked pristine—only to discover thousands in foundation damage, faulty electrical panels, or worn-out plumbing just months after closing.

One client who waived inspection ended up with a $12,000 sewer line replacement and a roof that leaked during the first rainstorm. These issues were likely visible to an experienced inspector—but with no inspection contingency, they had no leverage to renegotiate adn were stuck with the costs after closing.

Solution: Always inspect. You can make your offer competitive by shortening the contingency window or performing a pre-offer inspection if the seller allows. But never skip it outright. Learn more about common red flags and how inspections work in our guide. 👉 Read our guide to home inspections in Austin

7. Mistake: Dropping appraisal or inspection contingencies without understanding the risks

Contingencies protect your earnest money and give you a legal way out if the deal goes sideways. Dropping the appraisal contingency means that if the home appraises below contract price, you agree to make up the difference in cash. One buyer in Cedar Park waived the appraisal and had to bring $18,000 extra to close when the appraisal fell short—money they hadn’t budgeted for.

Similarly, dropping inspection contingencies exposes you to unseen damage with no right to negotiate repairs or credits.

Solution: Work with your lender and agent to structure smart contingencies. Consider including an appraisal gap clause with a cap, or an inspection clause with a quick resolution period. We help clients find the right balance between a strong offer and strong protection.

8. Mistake: Choosing the wrong real estate agent or lender

Not all real estate professionals are created equal. We’ve seen deals fall apart because agents failed to explain contract deadlines, didn’t catch HOA issues, or missed zoning disclosures. In one case, a buyer missed their option period deadline and was forced to proceed with a home that had serious drainage issues.

We’ve also had clients come to us after another lender failed to meet closing deadlines—causing them to lose their earnest money or delay moving into their home.

Solution: Choose an experienced Texas-based mortgage broker and a responsive, knowledgeable agent. At LendFriend, we collaborate with top-tier real estate professionals and keep all parties informed from preapproval to closing. 👉 Meet your LendFriend team

9. Mistake: Falling in love with a home without researching the neighborhood

We’ve seen first-time buyers fall head over heels for a home with stylish finishes or curb appeal—only to regret their decision after moving in. A couple in North Austin bought a beautiful home near a busy intersection without realizing the school district was rated below average and traffic noise was constant. Once they settled in, they realized the commute was longer than expected and their resale potential was lower due to location.

Solution: Before you get emotionally attached, take time to research. Visit the neighborhood at different times of day, check crime stats, confirm school ratings, and ask about nearby developments. Your agent and lender can provide resources like Walk Score and local market data to help you assess livability and future value.

10. Mistake: Making decisions based on emotion instead of long-term logic

Buying a home is emotional—but leaning too heavily on feelings can lead to poor financial decisions. We’ve worked with clients who waived their financing contingency or offered more than they could truly afford because they were afraid of “losing” a home they loved. One buyer in Dallas ignored their must-haves list and bought a charming bungalow without a second bathroom. Within a year, they sold at a loss because the layout no longer fit their growing family.

Solution: Stay grounded. Before touring homes, make a non-negotiable list (like bedroom count, square footage, or location) and stick to it. Your lender can help translate your lifestyle goals into realistic price ranges. An emotional connection is important—but logic should lead the purchase.

11. Mistake: Overlooking resale value and future flexibility

First-time buyers often assume they’ll stay in their home forever, but life changes fast. Job relocations, family size, or financial priorities can shift in just a few years. Buying a home with poor resale value—due to location, layout, or condition—can make it difficult to sell or rent later. One client in an outer Houston suburb chose a deeply discounted property with a funky layout and zero curb appeal. When they tried to sell three years later, their home sat on the market for months.

Solution: Think like a future seller. Prioritize homes with broad appeal—like open layouts, good school districts, newer systems, and walkable amenities. At LendFriend, we help buyers evaluate long-term appreciation potential using historical and forecasted market trends across Texas.

12. Mistake: Not consulting with family early about a potential down payment gift

Many first-time homebuyers in Texas could benefit from a family member contributing to their down payment—but don’t realize it until they’re scrambling to close. We’ve had buyers learn too late that a parent was willing to help, only to face delays due to last-minute documentation issues (or even worse - forego buying all together because they didn't think they had enough money to buy).

Solution: If you think a family member may help with your down payment, talk with them early. Gift funds must be well-documented to be compliant with underwriting standards, but at LendFriend, we make it easy. We guide families through this process from day one to ensure everything goes smoothly. 👉 Learn more about down payment gifts

Final Thoughts: How to Buy Smart and Avoid First-Time Homebuyer Regret

Buying your first home in Texas doesn’t need to be a stressful or uncertain experience. When you approach the process informed, prepared, and surrounded by the right professionals, you drastically reduce the chances of making costly mistakes. These aren’t just theoretical slip-ups—they’re real issues we’ve helped clients resolve, and more importantly, prevent.

At LendFriend Mortgage, we specialize in walking first-time buyers through every step of the homebuying journey—from understanding how credit impacts your rate to navigating appraisal gaps, inspections, and loan options tailored for your financial goals. Whether you’re buying in Austin, Houston, Dallas, or a smaller Texas market, we’re here to advocate for you, educate you, and secure the best path forward.

Want advice tailored to your situation? Or ready to take the first step with a verified preapproval?