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Rent-to-own homes in Texas

By Rent to Own Guide · Published · Updated · How we research

Short answer
Texas treats an option to buy that comes with a residential lease as an “executory contract” under Property Code Subchapter D. But for lease-options of three years or less, only a few protections apply: a formal default notice with 30 days to cure, a list of banned contract terms, cancellation for improper platting, and a rule that the seller must own the home free of liens. Longer lease-options get more, including disclosures before signing and recording.

Which rules apply to your lease-option

Under § 5.062(a)(2), “an option to purchase real property that includes or is combined or executed concurrently with a residential lease agreement, together with the lease, is considered an executory contract for conveyance.” The subchapter covers property used as the buyer's residence (or a close relative's), and § 5.062(f) limits which sections apply to shorter lease-options.

Texas executory-contract protections that apply to lease-options
ProtectionSectionLease-option, 3 years or lessLease-option, over 3 years
Default notice in a set format and a 30-day right to cure before forfeiture§§ 5.063–5.065YesYes
Banned terms: late fees above the lesser of 8% of the payment or actual cost; forfeiting an option fee for a late payment; penalties for requesting repairs§ 5.073Yes*Yes
Seller must own the property free of liens (narrow exception for a disclosed purchase-money loan)§ 5.085YesYes
Cancel and get payments back if the property wasn't properly platted§ 5.083YesYes
Survey, encumbrance documents, and property-condition notice before signing§ 5.069NoYes
Tax certificate and proof of insurance before signing§ 5.070NoYes
Cancel for any reason within 14 days§ 5.074NoYes
Seller records the contract within 30 days§ 5.076NoYes
Annual accounting statement each January§ 5.077NoYes
Right to convert to a deed; 40% / 48-payment equity protection§§ 5.081, 5.066Never applies to lease-optionsNever applies to lease-options

*Except § 5.073(a)(2). The 3-year test also looks at how long the same parties have had executory contracts on the property (§ 5.062(f)). Source: Texas Property Code ch. 5, subch. D. This is a summary, not legal advice.

Points that are easy to miss

  • The statute doesn't govern rent credits. Beyond banning forfeiture of an option fee for a late payment, what happens to credits is up to your contract.
  • The lease part is still a lease. Texas landlord–tenant law (Property Code chapter 92) applies to the lease portion until you exercise the option (§ 5.0621).
  • A seller with a mortgage. § 5.085 forbids executory contracts unless the seller owns the home free of liens, with a narrow exception for an existing purchase-money loan that requires, among other things, a written disclosure of the loan at least three days before signing and a lender that doesn't prohibit the arrangement. Violations can let the buyer cancel and recover payments.
  • The 180-day rule is about deeds, not leases. Subchapter D doesn't apply to contracts that deliver a deed within 180 days of signing (§ 5.062(c)).

The Texas Attorney General's home-buying page and TexasLawHelp.org explain executory contracts for consumers. Some protections they describe (such as equity after 40% or 48 payments) apply to contracts for deed but, under § 5.062(e), not to lease-options — read them with that in mind. Legislators' own description of the problem is blunt: these arrangements “leave the buyer extremely vulnerable to serious abuses” (2005 bill analysis).

Statewide homebuyer programs

  • My First Texas Home (TDHCA): 30-year fixed FHA, VA, or USDA loans with down payment assistance of 2%–5% of the loan, a minimum 620 middle credit score, a first-time-buyer test (no owned primary residence in three years), and required homebuyer education, per the program matrix published Aug 17, 2026 (TDHCA).
  • My Choice Texas Home doesn't require first-time-buyer status, and TDHCA also offers a Texas Mortgage Credit Certificate (TDHCA programs).

Local guides

Each covers that county's record searches, city assistance programs, and HUD-approved counselors: Houston, Dallas and San Antonio.

Cities in Texas

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Browse rent-to-own and distressed listings in Texas

Includes pre-foreclosures and other distressed homes.

Foreclosures and pre-foreclosures in Texas

These homes are in foreclosure or pre-foreclosure. They aren't rent-to-own offers, and a pre-foreclosure home may not be for sale at all, so check each one in county records.

Listings from Foreclosure.com. Full details need a paid Foreclosure.com membership.

How foreclosure works in Texas

Sources

  1. Texas Property Code, Chapter 5, Subchapter D (Executory Contract for Conveyance), §§ 5.061–5.087 — Texas Legislature. Official text; most recent amendment to the subchapter in 2023. Checked Oct 19, 2026.
  2. Home Buying & Moving — Office of the Texas Attorney General. Checked Oct 19, 2026.
  3. Executory Contracts and Lease-to-Own Real Estate — TexasLawHelp.org (Texas Legal Services Center). Last legal review Jul 23, 2024. Checked Oct 19, 2026.
  4. H.B. 1823 bill analysis (Engrossed), Senate Research Center — Texas Legislature. May 18, 2005. Checked Oct 19, 2026.
  5. Programs (My First Texas Home, My Choice Texas Home, Texas Mortgage Credit Certificate) — Texas Department of Housing and Community Affairs. Checked Oct 19, 2026.
  6. My First Texas Home program matrix (FHA · VA · USDA) — Texas Department of Housing and Community Affairs. Published Aug 17, 2026. Checked Oct 19, 2026.
  7. Find a HUD-approved housing counseling agency — U.S. Department of Housing and Urban Development. Checked Oct 19, 2026.

Looking at a specific rent-to-own offer?

Run the numbers for both outcomes — buying and walking away — then work through the checklist before you pay anything.

Open the cost calculatorDue-diligence checklist

Prefer to talk it through? A HUD-approved housing counselor can review your situation, often at little or no cost.