If you've bought a resale home before, you probably remember the contract as a standard form — the same Texas contract most agents use, with blanks filled in for your deal. A new construction contract is not that. It's a different document, written by different people, with different rules for your money and your exit. And most buyers first see it sitting at the builder's sales office, pen in hand.
Here’s what actually changes — and what to do about it before you sign.
1. Who wrote it — and who it protects
A resale contract in Texas uses the TREC-promulgated 1-4 contract: one standard form, written to be neutral, used on nearly every resale. A builder's contract is usually the builder's own paper, drafted by the builder's attorney. It's written to protect the builder's business — which makes sense from their side, and is exactly why you should read it like it was written for the other side. Because it was.
Some builders do use TREC’s New Home Contracts instead — form 23-20 for a home under construction, 24-20 for a completed home. Either way, the first question to ask is simple: which contract am I signing, and who wrote it?
2. It’s longer — and the fine print does more work
A builder's agreement can run 60 to 80 pages. That length isn't padding. It covers things a resale contract never has to: construction milestones, what happens if materials or selections change, how completion dates work, and what the builder's obligations are if something goes wrong mid-build.
Two sections deserve your full attention. First, dispute resolution — many builder contracts include an arbitration clause, which changes how a disagreement gets settled. Second, anything that says the builder "may" do something. "May" is doing a lot of work in that sentence. Know what it means before you sign, not after.
3. The earnest money works differently
On a resale, earnest money is typically 1–3% of the price, and the option period gives you a window to walk away and get it back. On a new build, builders often ask for more — commonly 1–5% in Texas — and it's often staged: a deposit at contract, more at slab, more at framing, more before closing. And it's often non-refundable outside a few narrow contingencies.
That doesn't make it a bad deal. It makes it a deal you need to understand in writing before the money moves: how much, when each stage is due, and exactly what would have to happen for you to get any of it back. We'll go deep on earnest money in Wednesday's post — this is the headline version.
4. The option period mostly isn’t there
This is the single most common surprise for first-time new construction buyers in Texas. On a resale, you pay a small option fee and get a set number of days — typically 3 to 10 — to inspect, think, and walk away with your earnest money. On a new build, there usually isn't a true option period. Instead, the contract gives you specific, narrow exit deadlines tied to construction milestones or financing.
That means the "I can always change my mind" safety net from resale doesn't carry over. Your exit rights are whatever the contract says they are, on the dates it says they are. Know them before you sign — not when you need them.
5. The closing date is an estimate, not a promise
A resale closing date is a date. A builder's completion date is an estimate with flexibility built in — the contract usually gives the builder a grace period if construction runs long, and delays cascade trade by trade. That matters for your rate lock, your lease, and your moving plans. If your lease ends the same week the builder "expects" to finish, you need a plan B in writing, not in your head.
We’ll cover build timelines — and what happens when a builder is late — later in this series.
6. Inspections and warranty live in the contract too
A new home still needs an independent inspection — the city inspector works for the city, not for you, and the contract sets the windows when your inspector can get in. And the warranty is in the contract as well: Texas law sets a 1-2-10 structure — one year on workmanship and materials, two years on systems like plumbing, electrical, and HVAC, ten years on structural. Ask for a sample warranty before you sign, and know what starts the clock.
We'll go deep on inspections and warranty in the coming weeks. For now, know they aren't afterthoughts — they're contract terms.
What to do before you sign
Get the contract early. Ask for a copy before you fall in love with the model home. Take it home. Read it at your kitchen table, not at the sales desk.
Have your own agent read it with you. The builder's sales rep works for the builder. Your agent works for you — and a second set of eyes that has read builder contracts before is worth more than any incentive on the table.
Know the three things in writing: how much earnest money, when each stage is due, and when it becomes non-refundable; your exact exit deadlines; and the completion window with the builder's grace period.
Don't sign under pressure. A builder who won't let you take the contract home is telling you something. The home will still be there tomorrow.
Register your agent before your first visit. If you walk into a community on your own first, the builder may treat you as unrepresented — and that can affect whether your agent is recognized on the deal at all.
The bottom line
A builder's contract isn't a bad thing. It's a different thing — longer, written for the builder, with bigger and harder-to-recover earnest money, narrow exit windows, and a completion date that flexes. None of that is a reason not to buy new construction. It is a reason to read the contract before you sign it, with someone in your corner who has read them before.
If you're looking at new construction in Crosby, Baytown, Mont Belvieu, or Huffman and want a second set of eyes on the contract before you sign, that's exactly what we do.
Questions? DM us — Amanda 936-224-8974, Saul 936-314-4728.
