Preparing for Homeownership While You Rent (Stephenville & Cross Timbers Edition)

Becoming a homeowner is a significant milestone—and it’s smart to begin preparing early. Even while renting, there are concrete steps you can take now that will put you in a stronger position when you’re ready to buy. Below, I’ve updated the advice with local context and current trends for Stephenville, and surrounding towns like Granbury, Hico, Brownwood, Hamilton, and so on.

1. Get to Know the Local Market

Before dreaming of your future home, get familiar with what “affordable” looks like in your area. Use local listings, realtors, and market reports to get a sense of prices, trends, and what your monthly housing costs might be.

Current Stephenville Market Snapshot

• The median home sale price in Stephenville was about $299,500 in mid-2025, which is down ~11.9% from a year earlier. (Redfin)
• Zillow reports the average home value in Stephenville as $319,413, up ~2.5% over the past year. (Zillow)
• Listings in the 76401 zip code (Stephenville) show a median listing price near $356,000, with sold home prices around $320,600. (Realtor)
• According to our own market reports at Preferred Properties, in the last 30 days, new listings had a median price of $375,000, while active listings’ median was $315,500. (Preferred Properties of Texas)
• Homes are taking longer to sell: where once many homes sold in under 30 days, now the median days on market is closer to 48–50 days—and sometimes more. (Redfin)

This tells us a few things:

• Prices have softened somewhat from the peaks, which may give buyers more negotiating room.
• Inventory is moderate, and homes are staying on the market longer than in past “hot” years.
• Expect to pay in the low-to-mid $300,000s for a decent single-family home, depending on size, condition, lot, and location.

When you’re ready, a REALTOR® familiar with Erath County and the Cross Timbers region can help you run a realistic “buying budget” — including mortgage, taxes, insurance, and maintenance.

2. Order Your Credit Reports and Clean Up Errors

Your credit history is one of the biggest factors lenders consider. Before you apply for a mortgage, take time to ensure your credit report is as polished as possible.

• You’re entitled to a free credit report from each of the three major credit bureaus (Equifax, Experian, TransUnion) every 12 months via AnnualCreditReport.com.
• Review them carefully for errors—incorrect late payments, closed accounts reported inaccurately, or identity mix-ups. Dispute anything you believe is wrong.
• Pay down existing debts (especially credit cards), and keep utilization low (ideally under 30% of your credit limits).
• Make every payment on time; consistency matters more than a one-time large payment.
• If you have limited credit history, consider adding a small credit-builder loan or “secured” credit card to help you build a track record of on-time payments.

In Texas, many conventional loan programs require a minimum credit score of 620, though FHA or VA programs may accept lower scores (sometimes ~580) under certain conditions. (Texas United Mortgage)

Also, statewide data shows that just under 30% of Texans have credit scores below 620—meaning a sizable portion of prospective buyers may need time to improve. (Federal Reserve Bank of Dallas)

If possible, aim to raise your score above 680–700 for better interest rates and more loan flexibility.

3. Determine What You Really Want — and What You Can Live Without

Many buyers fall into the trap of expecting a “perfect” home. But when budget and market realities hit, it helps to know your priorities.

• Create a “must-have vs. nice-to-have” list. For example:
  • Must-have: at least 2 full bathrooms, 3 bedrooms, decent school district
  • Nice-to-have: large gourmet kitchen, covered patio, oversized garage
• Consider trade-offs: a slightly smaller or older home may free up budget for upgrades later.
• Pay attention to location factors: distance to highways (e.g., I-20, US 377), school zones (Stephenville ISD, Hamilton ISD, etc.), commuting time to Fort Worth or Granbury, and land size.
• Don’t underestimate repair and maintenance costs, especially in rural or semi-rural portions of the Cross Timbers. Budget a cushion for roof, HVAC, plumbing, or septic issues.

4. Save Strategically (Down Payment, Closing Costs & Reserves)

Buying a home doesn’t just cost the purchase price. Here’s where your savings should be focused:

• Down payment — Some loans allow as low as 3–5% down, but 10–20% gives you more options and better rates.
• Closing costs & fees — These can run 2–5% of the home’s price (appraisal, title insurance, surveys, etc.).
• Reserves/emergency fund — Lenders like to see you have extra cash in reserve for unexpected home repairs.
• Home upgrades — If your new home needs improvements (flooring, appliances, paint), factor those in.

While renting, consider automating transfers into a separate “home fund” account so saving happens without thinking.

5. Understand Mortgage Types & Prequalification

When the time comes, you’ll want to compare what lenders offer and know which route best fits your situation.

• Conventional loans are common but typically require higher credit scores and down payments.
• FHA loans are more flexible for lower credit scores, though they come with mortgage insurance.
• VA loans (for veterans/active military) often have lower credit requirements and no down payment.
• Texas-specific programs — There are some first-time buyer assistance programs and down payment assistance options in Texas worth exploring.

Obtain prequalification or preapproval to see exactly what financing you can qualify for. That helps you shop with confidence and gives you more credibility when making offers.

6. Monitor Interest Rates and Lock When Smart

Mortgage rates fluctuate daily. While nobody can time the perfect moment, keep an eye on national and Texas-specific trends, and be ready to lock a rate when favorable.

Higher interest rates reduce your purchasing power, so if rates drop or stabilize, it could be a good signal to begin seriously looking.

7. Work with Local Experts You Trust

There’s a big difference between general real estate knowledge and knowing your local market inside out. As you approach homebuying:

• Partner with a REALTOR® who specializes in Stephenville, Erath County, Brownwood, Hamilton, Granbury, and the surrounding Cross Timbers region.
• Ask about recent comparable sales, neighborhood trends, utility costs, common repair issues, and school zones.
• Let your agent help you run a “purchase budget” worksheet that includes mortgage, taxes, maintenance, insurance, and unexpected costs.

8. Keep Your Finances in Order (Beyond Credit)

• Maintain a steady income and employment history—lenders look for consistency.
• Avoid taking on large new debts (auto loans, new credit cards) in the months leading up to applying.
• Keep your bank accounts active, but avoid large, unexplained deposits—lenders will ask for source documentation.
• If you have student loan debt, work toward reducing balances or consolidating to lower monthly payments.

9. Plan & Reassess Regularly

Your timeline to buy might be 1, 3, or 5 years out. Make a habit of revisiting your goals annually:

• Re-run your credit reports and update your debt/savings goals
• Refresh your local market research and adjust your target neighborhoods
• Reassess your “must-have vs. optional” list
• Check new first-time buyer programs or assistance that may become available

Even if you’re not ready today, each year brings you closer.

Final Thoughts & Local Expertise

Buying your first home is a journey, not a race. By using your time as a renter wisely, you can build a strong foundation—financially, mentally, and strategically.

When you are ready,  call us, 254-965-7775,  Preferred Properties of Texas. We’ve been helping clients find their preferred property for over 30 years, not just in Stephenville but across Granbury, Fort Worth, Hamilton, Brownwood, and every town in between. We’re here to answer your questions, walk you through each step, and help you avoid surprises along the way.

Let’s get prepared—together.

Resources & References

• Redfin — Stephenville housing market trends (Redfin)
• Zillow — Stephenville average home value & trends (Zillow)
• Realtor.com / FRED — median listing price data (FRED)
• Texas United Mortgage / Texas Home Loans — credit score & loan type guidance (Texas Home Loans)
• Preferred Properties of Texas — local market reports (Preferred Properties of Texas)
• Dallas Fed/consumer credit trends in Texas (Federal Reserve Bank of Dallas)
• Texas SML — 2024 Report on Mortgage Lending in Texas (Savings and Mortgage Lending Dept.)