First-time homebuyer programs and grants in Texas
Senior Content Writer
Quick insights
- Texas first-time homebuyer programs include My First Texas Home, Home Sweet Texas and Homes for Texas Heroes.
- Assistance programs may offer a grant, a forgivable second mortgage or a repayable loan, each with long-term requirements that can affect your choice of program.
- Eligibility generally depends on factors like income, credit profile, purchase location, property price and completion of an approved homebuyer education course.
From Austin’s live-music scene to the suburbs of Dallas and Houston, Texas offers homebuyers a wide range of places to put down roots. In a state known for open space, the upfront costs of homeownership can feel just as vast. Texas first-time homebuyer grants and programs may help eligible homebuyers. The assistance can help manage the down payment, closing costs or mortgage financing, which might make the journey from house hunting to holding the keys more manageable.
Texas first-time homebuyer programs
Texas offers homebuyer assistance through the Texas Department of Housing and Community Affairs (or TDHCA) and the Texas State Affordable Housing Corporation (or TSAHC). These organizations work with participating mortgage lenders rather than accepting mortgage applications directly from potential buyers.
My First Texas Home
The My First Texas Home program combines a 30-year, fixed-rate mortgage with assistance that may be used toward down payment and closing costs. The program is generally available to qualifying first-time homebuyers, although certain veterans and buyers purchasing in targeted areas may be exempt from the first-time homebuyer requirement.
Applicants must:
- Meet income and purchase-price limits for their county.
- Satisfy the credit and mortgage underwriting requirements for the selected mortgage.
- Use the property as their primary residence.
- Complete an approved homebuyer education workshop.
- Apply through a TDHCA-approved lender.
Available mortgage options may include conventional, FHA, VA and USDA financing. The amount and structure of assistance can vary based on the mortgage option, current program terms and the buyer’s qualifications.
Chase does not offer USDA loans.
My Choice Texas Home: Alternative program for first-time and repeat homebuyers
My Choice Texas Home is not limited to first-time homebuyers. However, eligible first-time buyers may consider the program when comparing statewide mortgage and assistance options. My Choice Texas Home offers a 30-year, fixed-rate mortgage and down payment or closing cost assistance to eligible repeat and first-time Texas homebuyers statewide.
Homebuyers typically need to meet applicable income, credit, loan and property requirements. Some financing options may offer assistance of up to 5% of the mortgage amount, but the amount available can depend on the selected loan product and current program guidelines.
Home Sweet Texas Home Loan Program
The Home Sweet Texas Home Loan Program, administered by TSAHC, provides fixed-rate mortgage options and down payment assistance for qualifying low- and moderate-income homebuyers. First-time homebuyer status is not required for every option.
Assistance may be structured as a grant (a cash gift that never requires repayment) or a forgivable second-lien loan (it is deferred and forgivable, meaning you make no monthly payments on it). You only pay it back if you sell your home or refinance your mortgage within the first three years. Buyers need a credit score of at least 620, must meet program income limits and obtain their mortgage through an approved lender. Always confirm the specific terms, conditions and any repayment triggers in the program guidelines.
Homes for Texas Heroes Home Loan Program
The Homes for Texas Heroes Home Loan Program offers mortgage and down payment assistance options for eligible public-service professionals and veterans. Qualifying occupations may include:
- Public school teachers, teacher aides, librarians, nurses and counselors.
- Firefighters and emergency medical services personnel.
- Peace officers, corrections officers and county jailers.
- Veterans and active-duty servicemembers.
- Certain nursing and allied health faculty members.
Applicants must meet income, credit and mortgage requirements. Eligible Texas Heroes may also qualify for a Mortgage Credit Certificate without the standard issuance fee when combining it with TSAHC down payment assistance.
Texas Mortgage Credit Certificate Program
A Texas Mortgage Credit Certificate (MCC) may allow an eligible first-time homebuyer or veteran to claim a federal tax credit equal to 15% of eligible mortgage interest paid. For example, if a homeowner pays $10,000 in qualifying mortgage interest during the year, a 15% MCC rate could provide a tax credit of up to $1,500. Credit eligibility is subject to federal tax rules and the homeowner’s tax liability.
The standard MCC issuance fee is usually $400, although the fee may be waived for eligible Homes for Texas Heroes borrowers who combine an MCC with TSAHC down payment assistance. Timing is crucial. Homebuyers must apply through an approved TSAHC lender and reserve the MCC before the mortgage closes. An MCC can’t be added after closing.
Consult a qualified tax professional about the tax implications.
Additional down payment gift funds
TDHCA also partners with certain local housing finance agencies to offer additional gift funds in eligible communities. Participating areas may include designated portions of Central Texas, Harris County and McKinney. Availability depends on the buyer’s location, eligibility and remaining funds.
Regional and city homebuyer programs in Texas
Some Texas cities offer separate assistance programs for buyers purchasing within their boundaries. Local funding can be limited, so program status should be confirmed before a buyer makes an offer or relies on the assistance.
Houston Homebuyer Assistance Program
Houston’s Homebuyer Assistance Program may provide up to $75,000 to eligible buyers. However, the City of Houston currently states that available program funds are exhausted and that additional applications are not being accepted or processed. Customers should check the city’s program page for reopening and funding updates.
Applicants must have household income at or below 80% of the area median income, complete approved homebuyer education and purchase a qualifying home that is taxed by the City of Houston. The loan may be forgiven after five years of continued occupancy, while selling or moving earlier could trigger partial repayment. Program applications may be paused when funding is limited.
Dallas Homebuyer Assistance Program
The Dallas Homebuyer Assistance Program (or DHAP) may offer eligible buyers up to $50,000, or up to $60,000 when purchasing in certain High Opportunity Areas. Funds may be applied to eligible down payment and closing costs.
Homebuyers must meet household income limits, purchase within Dallas city limits and work with a DHAP-approved lender. There’s also a homebuyer education course to complete. Assistance remains subject to a full eligibility review and funding availability.
Austin Down Payment Assistance Program
Austin’s Down Payment Assistance ProgramOpens overlay may provide qualifying first-time homebuyers with up to $40,000 for down payment, closing costs and certain prepaid expenses. The home’s sales price generally cannot exceed $440,000 according to the program information at the time of writing.
Fort Worth Homebuyer Assistance Program
The Fort Worth Homebuyer Assistance Program may provide up to $25,000 for eligible down payment and closing costs. Buyers must purchase within Fort Worth city limits, complete approved homebuyer education, contribute some of their own funds and qualify through an approved lender. Assistance of up to $25,000 may be forgiven after 10 years of continued primary-residence occupancy, while smaller awards may have a shorter forgiveness period.
Applying to Texas first-time homebuyer programs
Before choosing a program based on its maximum assistance amount, consider how it would fit into your overall mortgage and budget. Here are general steps you can follow when preparing to buy your first home:
- Review your financial starting point. Check your credit score, income, debts and available assets to estimate what you may be prepared to spend.
- Calculate the full cost of buying a home. Use a homebuyer assistance calculator to estimate the down payment, closing costs, property taxes, homeowner’s insurance and potential monthly payment.
- Search by purchase location. Compare statewide programs with assistance available through the city or county where you plan to buy.
- Examine the assistance terms. Find out whether the funds are a grant, forgivable loan or second mortgage, and what may happen if you sell, refinance or move.
- Complete a homebuyer education course. Many programs require an approved course before closing, so consider finishing it early.
- Choose a participating lender. Confirm that the mortgage lender is approved for the specific TDHCA, TSAHC or local program you’re considering.
- Prepare your documents. You may need to provide pay stubs, tax returns, bank statements, identification and information about your outstanding debts.
- Verify the property requirements. Programs may restrict the home’s location, price, type or condition.
- Confirm assistance before closing. Funding may be limited, and some benefits (including an MCC) must be applied for or reserved before the mortgage closes.
In summary
Texas first-time homebuyer programs may help eligible buyers manage the upfront costs of purchasing a home. Statewide options include My First Texas Home, Home Sweet Texas and Homes for Texas Heroes, while cities such as Houston and Dallas offer assistance within their respective local limits.
The program with the largest advertised amount may not always be the most suitable option for your homebuying journey. It’s usually helpful to compare eligibility rules, mortgage terms, monthly costs and repayment requirements before moving forward with an approved Texas lender.
