Buying property in the USA: the process from offer to closing

In the USA, there is no single figure who handles the whole purchase. The agent, the escrow agent, the title company, the inspector and the lender each take on one piece, and every state writes its own rules for it. Here is the process from the first offer to the recorded deed, with the differences between Texas, Florida, California and New York.

1What works differently when you buy in America

The biggest difference isn't the price or the language. It's who does what. In the USA, the work of a purchase is split into separate pieces. In many states the real estate agent drafts the contract on a standard form, an escrow agent holds the money, a title company checks the chain of ownership and insures it, an inspector looks at the house, and the lender, if there is one, has its own deadlines. None of them carries overall responsibility for the transaction alone.

The second quirk: in the USA, real estate law is a matter for the states. Whether there are mandatory forms, who must disclose what, which tax applies to the transfer and how the deed is recorded are set out in fifty different sets of laws. This guide uses the Texas standard contract as its model, because Texas lays out the process in an official form in particular detail, and shows where Florida, California and New York differ.

Good news first: as a European, you're allowed to buy. There is no federal law that bars foreigners from buying residential property. If you acquire agricultural land, the Agricultural Foreign Investment Disclosure Act requires you to report it to the US Department of Agriculture within 90 days; for a ranch that's a real obligation, for a house in town it isn't. Some states restrict buyers from countries they consider a concern. Florida's § 692,201 names China, Russia, Iran, North Korea, Cuba, the Venezuelan regime and Syria. No European country is on that list.

What a purchase doesn't give you is the right to live here. A property you hold to rent out or to wait for it to appreciate is not an investment in a business for the E-2 visa: the State Department's Foreign Affairs Manual expressly excludes passive, speculative investments. If you want to live in America, plan the visa separately, for example through the E-2 investor visa.

2The offer: purchase contract and earnest money

You buy with a written offer. Once you've found a house, your agent prepares an offer that is usually already the complete purchase contract: price, financing, deposit, deadlines, closing date. When the seller signs, the contract is formed. Nothing works verbally. Texas requires a contract for the sale of real property to be in writing and signed by the party it is to be enforced against (Business & Commerce Code § 26.01), and so does Florida (§ 725.01 Florida Statutes).

In Texas, the content is largely prescribed too. Agents may only use the forms the Texas Real Estate Commission has made mandatory (22 Texas Administrative Code § 537.11). For resales of one- to four-family homes, that's the One to Four Family Residential Contract (Resale), form 20-19, effective July 1, 2026. Condos, new builds from a developer and farm and ranch properties have their own forms.

With the contract, you pay earnest money, a deposit that shows you're serious. Under the Texas form it goes to the escrow agent, not the seller, within three days of the effective date. On top of that comes the option fee, a small amount that buys you the right to back out in the first few days without giving a reason. You fill in both amounts in the contract yourself. No law says how high they should be.

If you're buying from Europe, have the earnest money ready before the offer goes out. Three days isn't enough for a first transfer from an account whose bank wants to review the payment first. How euros and other currencies reach an American account is covered in Sending money to the USA.

3Option period and inspection: the days when you can still walk away

The option period is the buyer's most important tool in the Texas contract. In exchange for the option fee, the seller gives you the unrestricted right to terminate the contract within an agreed number of days after the effective date, with notice by 17:00 local time on the last day. Terminate in time and the seller keeps the option fee while you get your earnest money back. Miss the deadline and the form demands strict compliance: from then on, your money depends on the contract's other conditions.

This is when you have the house inspected. Under the Texas contract, the seller must give you and your representatives access, and the inspection is done by inspectors you choose who are licensed by the Real Estate Commission. The report is the basis for renegotiating repairs or the price, or for walking away.

At the same time, the seller has to disclose what they know. In Texas, Property Code § 5,008 requires the seller of a single-family home to provide a written Seller's Disclosure Notice by the time the contract is signed. If it comes later, you may terminate the contract for any reason within seven days of receiving it. Florida's flood disclosure (§ 689,302) requires a statement at or before signing on whether the house was damaged by flooding while the seller owned it and whether insurance or assistance was paid out for it. The statutory form states that ordinary homeowners insurance does not cover flood damage. In New York, the seller hands over the Property Condition Disclosure Statement before the buyer signs a binding contract; the Department of State form stresses that it is not a warranty and does not replace an inspection.

4Escrow: who holds your money, and how to protect it

In escrow, a neutral third party holds money and documents until the conditions of the contract are met, and then pays out. The parties name that party in the contract. In Texas, title companies also act as escrow agents; the state insurance regulator licenses title and escrow together.

Because large sums move by wire transfer at the end of a purchase, real estate deals are a favorite target for fraud. The Texas insurance regulator advises recording the name, email and phone number of everyone involved, confirming payment instructions directly with your title agent, distrusting any email that pushes you to hurry or reports changed account details, and checking right after you pay that the money has arrived. For buyers from Europe this counts double: the time difference and an unfamiliar bank make it easier to miss a fake message. Call, using a number you didn't get from the email in question.

If you pay without a loan, the full price comes from your own funds, often in several transfers. Plan the currency conversion ahead and agree with the title company when the money must be in the escrow account. What a purchase without a bank looks like is covered in our guide Buying property in the USA without bank financing.

5Title and title insurance: who really owns the house

The county records the deeds submitted to it. Whether the chain of ownership is complete and what encumbrances exist is checked by the title company before it insures. It gives you the title commitment, a promise of title insurance listing all exceptions, such as easements, neighborhood deed restrictions or outstanding liens. Under the Texas contract, the seller must deliver the commitment and exception documents within the agreed deadline; if it's delayed beyond a grace period of up to 15 days, you may terminate and get your earnest money back.

Title insurance itself protects your ownership against defects that arose before the purchase. The Texas Department of Insurance gives examples such as unpaid property taxes, fraud or forgery in earlier deeds, and spouses or unknown heirs who claim ownership. There are two policies: the Owner's Policy for you, valid for as long as you own the property, and the Loan Policy for the lender, valid until the loan is paid off. You pay the premium once, at closing.

Prices differ markedly between states. In Texas, the Commissioner of Insurance sets the premiums (Insurance Code § 2703.151), so every title company charges the same, and the policy wording is standardized. The only differences are in individual closing fees, and you may choose any licensed title company, even if your agent or lender recommends a different one. In Florida, a rule of the Financial Services Commission sets the premiums (§ 627,782 Florida Statutes). How owners in Texas can fight back against forged deeds is covered in our article Property fraud in Texas.

6Closing: signatures, money and the deed

Closing is where everything comes together. Under the Texas contract, the seller delivers a General Warranty Deed, guaranteeing title to the property, along with certificates showing that no property taxes are outstanding; you pay the balance of the purchase price through escrow. If you finance with a consumer loan, the lender must get the Closing Disclosure with all costs to you no later than three business days before closing (12 CFR § 1026.19(f)). More in Financing US real estate as a foreigner.

One point matters especially to you as a buyer from abroad: the signature. The deed recorded with the county must be notarized. If you sign in Europe, Texas accepts an acknowledgment by a US consul or by a notary of the country where you sign (Civil Practice and Remedies Code § 121,001(c)). Florida likewise accepts notaries of the foreign country and US consular officers (§ 695.03(3)). Check with the title company in advance whether it also wants an apostille, so no document is missing on closing day.

If you buy through a company rather than in your own name, the title company will want proof that the company exists and who may sign for it. For residential property transferred without financing to companies or trusts, FinCEN had introduced a separate reporting requirement. A federal court in Texas struck this rule down on 19 March 2026, and FinCEN has appealed; as long as the ruling stands, no such reports have to be filed. Whether you buy privately, through an LLC or through a corporation is something you decide before making an offer, because the buyer is named in the contract. The differences are explained in Buying US property through an LLC.

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7Deed recording: why only recording protects you

After closing, the title company files the deed with the county. This is more than a formality. In Texas, a conveyance is void against creditors and later buyers without notice until the deed has been acknowledged and filed for recording (Property Code § 13,001). Florida's rule is almost word for word the same (§ 695.01). Between the parties, the sale is valid even without recording; against the rest of the world, only once it is recorded.

Recording makes your name public. County records are public, and so is your deed. If you don't want that, you have to decide before buying who is named in the contract. A company replaces your name with its own in the county records, but it does not make you invisible to the authorities.

If the seller is a foreigner too, you as the buyer temporarily become a withholding agent. Under § 1445 of the Internal Revenue Code, you must then withhold 15 percent of the purchase price and pay it to the IRS within 20 days; the Texas contract covers this in paragraph 20. For a home up to $300,000 that you plan to live in yourself, no withholding applies, and up to $1 million it drops to 10 percent. At the latest when you sell, the rule affects you from the other side. The details are in Taxes on US real estate.

8Texas, Florida, California, New York: what differs

The basic structure is the same everywhere: written contract, due diligence, escrow, title, closing, recording. What makes a purchase expensive or cheap is the transfer tax, and here the states are far apart.

Texas charges none. Since 2016, the state constitution has prohibited any law imposing a tax on the transfer of real property (Art. VIII § 29). Florida charges documentary stamp tax of 70 cents per $100 of the purchase price (§ 201.02). In California, all 58 counties levy a documentary transfer tax of $0.55 per $500, and cities may charge up to half that rate on top. New York takes $2 per $500, plus a 1 percent mansion tax on residential property from $1 million; in New York City, further taxes apply to very expensive properties.

The differences extend to the eventual sale. Texas and Florida levy no personal income tax; Texas's constitution also prohibits a tax on individuals' capital gains (Art. VIII § 24-b, adopted in November 2025). California requires withholding of 3 1/3 percent of the sale price when a property is sold, if the price exceeds $100,000 and no exemption applies (Franchise Tax Board Form 593). New York only records a nonresident seller's deed once the seller has paid the estimated income tax on the gain with Form IT-2663 or claimed an exemption. Buy in California or New York, and you buy these exit rules along with the property.

Which state suits you depends on how you'll use the property and what you plan. For vacation rentals in the South, take a look at Buying and renting out a house in Florida; why many of our clients end up in Texas is explained on our page about Texas.

9After closing: tax ID, property tax and inheritance

Once you have the keys, your duties as an owner begin. Property tax comes from the county; in Texas, the value is assessed as of 1 January, and the tax is due by 31 January of the following year (Tax Code §§ 23.01, 31.02). If you rent out the property, you need a tax ID for your IRS return; as a foreigner without a Social Security number, that means an ITIN. Without one, you also can't give your tenant or property manager Form W-8ECI, which removes the 30 percent withholding on gross rent.

And then there's inheritance. For owners not resident in the US, US estate tax kicks in early, and how you bought helps decide what your heirs pay. The numbers are in US estate tax for foreign owners; the structures buyers from Europe use in response are compared in The ideal legal structure for US real estate.

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In short

• There is no notary handling the deal the way there is in many European countries. Agent, escrow agent, title company, inspector and lender share those tasks, and each state sets its own process.
• The purchase contract must be in writing. In Texas, agents use the mandatory Real Estate Commission forms, with earnest money and an option period during which you can walk away for any reason.
• The title company checks the chain of title and insures your ownership; the money goes through escrow, and you always confirm wire instructions by phone.
• Only recording the deed with the county protects you against later buyers and creditors.
• Transfer taxes range from zero in Texas to the mansion tax in New York.

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