What Is in a Texas Builder Contract - Prosper Relocation REALTOR
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What Is in a Texas Builder Contract
What is a builder contract in Texas?
A builder contract is the purchase agreement a home builder drafts for its own new construction sales. It replaces the TREC promulgated form used in Texas resale transactions. Because the builder writes it, it is organised around the builder's process rather than around a resale timeline, and it contains categories of provision that have no equivalent in a resale contract at all.
Key facts
Texas resale purchases use a contract form promulgated by the Texas Real Estate Commission. Builder purchases generally do not.
A builder contract is drafted by the seller's side, so it allocates risk in the way any seller's document does.
It typically bundles several documents: the purchase agreement itself, plan and specification exhibits, a selections or options addendum, a limited warranty document and community governing documents.
Provisions with no resale equivalent include structural selection deadlines, change order procedure, allowance reconciliation and construction-stage access.
A real estate agent may explain what a category of provision does. Interpreting the language of a specific contract is legal work.
Since January 1, 2026, Texas SB 1968 requires a license holder to have a written agreement with a buyer before showing residential property.
Why the resale instinct misleads here
Experienced Texas buyers arrive at a builder contract with a set of expectations built on the promulgated form: a defined option period, a familiar financing addendum, an inspection framework, an amendment process everyone knows. Those expectations are reasonable and mostly wrong.
None of this makes builder contracts improper. They are commercial documents, and a company selling several hundred homes a year in a market has sound reasons to use one document rather than negotiate several hundred.
The risk is not that the contract is unfair. It is that it is unfamiliar, and buyers read unfamiliar documents at the speed of familiar ones.
The categories, and who answers questions about each
A builder contract can be read as a set of categories. Knowing which category a question belongs to tells you who can answer it.
Category | What it governs | Who to ask |
Purchase and price | The base price, what the base includes, and whether and how price can change after signing. | Builder for terms; attorney for what the language permits |
Deposit and default | What is paid, when, in how many parts, and what happens to it if either side does not perform. | Builder for the schedule; attorney for the default provisions |
Plans and specifications | What is actually being built, described by exhibit rather than by the model home you toured. | Builder; ask for the exhibit set in writing |
Selections and allowances | Which choices are yours, when each category locks, and how allowance overages and credits are reconciled. | Builder and design center |
Change orders | Whether changes are permitted after a category closes, what charge applies, and whether a change affects the schedule. | Builder |
Completion and delay | How a completion date is characterised, what delays are excused and what remedy attaches to a missed date. | Attorney |
Financing | Approval requirements, timing, and any conditions attached to advertised incentives. | Lender; builder for incentive conditions |
Warranty | Tier structure, administration, claim procedure, notice requirements and transferability. | Warranty administrator named in the document |
Access during construction | Whether and when a buyer or a buyer's inspector may enter the site. | Builder |
Community documents | Association obligations, restrictions and any district assessments attaching to the lot. | Association and county records |
Dispute resolution | Whether disputes go to arbitration or court, in what forum, and at whose cost. | Attorney |
Where builders differ from one another inside these categories is covered separately in how DFW builder contracts differ.
What the contract is not
Three things buyers frequently treat as part of the contract are not.
The model home is not the specification. It is a marketing asset, typically fully upgraded and sited on one of the better lots in the section. The plan and specification exhibits describe what you are buying.
The registration policy is not in the contract. Whether a buyer's agent is recognised is set by the builder's own policy, and it usually turns on when the agent first appeared. That is covered in who represents you at a Texas model home.
District assessments are not builder terms. They attach to the platted lot and do not change if you change builders inside the same community. The verified breakdown is in the DFW community district lookup.
Questions buyers ask
Do Texas builders use the TREC contract?
Generally no. The promulgated TREC form governs resale. Builders typically use their own purchase agreement.
Can a real estate agent explain a builder contract to me?
An agent can explain what a category of provision does and what questions it raises. Interpreting the specific language, or advising on its legal effect, is work for a Texas attorney.
Is there an option period in a builder contract?
Not in the form Texas resale buyers expect. Builder contracts handle inspection, termination and default through their own provisions, which differ by builder.
What documents come with the purchase agreement?
Commonly plan and specification exhibits, a selections or options addendum, a limited warranty document and community governing documents. Ask for the complete set rather than the signature pages.
When do my selections lock?
Structural selections generally close well before finish selections, so there is rarely one deadline. The schedule is set by the builder and stated in the selections addendum.
Can I have an attorney review a builder contract?
Yes, and for a document of this size and duration many buyers do. Build the review time into your schedule rather than discovering you need it on signing day.
Does the builder pay my agent?
In most DFW new construction transactions the builder pays the buyer agent's compensation, subject to the builder's registration policy. Confirm for the specific community.
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About the author
Nitin Gupta, Broker Associate, Competitive Edge Realty LLC. CRS, GRI, CLHMS, ALHS, PSA, ABR, SRS, SRES, e-PRO, MRP, TRLS, TRPM. TREC License #0668540. 480+ closed transactions and more than 300 new construction closings across 50+ DFW builders. Named D Magazine Best REALTOR in 2020, 2023 and 2024. Service in English, Hindi, Punjabi, Urdu and Gujarati.
