Down payment assistance programs in Texas can cover a meaningful share of what a first-time buyer needs upfront. Two state agencies run the major programs: TDHCA and TSAHC. Both pair a mortgage with assistance funds. However, the details differ enough to matter.
Quick Answer: Texas Down Payment Assistance at a Glance
Down payment assistance programs in Texas generally offer up to 5% of your loan amount. That money can go toward your down payment or your closing costs. Most require a 620 minimum credit score and a homebuyer education course. The two major providers are TDHCA and TSAHC. Each runs several programs with slightly different eligibility rules.
How Much Down Payment Does a First-Time Homebuyer Need in Texas?
TDHCA: My First Texas Home
The Texas Department of Housing and Community Affairs runs My First Texas Home. It pairs a 30-year fixed-rate mortgage with down payment assistance of up to 5% of the loan amount. That assistance comes structured as a deferred, zero-interest second loan rather than a grant. As a result, it typically gets repaid when you sell, refinance, or pay off the home.
TSAHC: Home Sweet Texas
The Texas State Affordable Housing Corporation offers Home Sweet Texas. This program is open to eligible buyers more broadly than some of TSAHC’s other options. Depending on the specific option chosen, assistance can come as a grant or as a deferred second lien. Because of that, it’s worth confirming which structure applies before counting on a specific repayment outcome.
TSAHC: Homes for Texas Heroes
Also through TSAHC, Homes for Texas Heroes targets specific public service professions. Teachers, firefighters, police officers, veterans, and EMS personnel all qualify, along with several other professions. Because this program is designed around service to the community, eligibility depends on your profession. It’s in addition to the standard income and credit requirements.
The Texas Mortgage Credit Certificate (MCC)
Separate from direct down payment assistance, the Texas Mortgage Credit Certificate offers an ongoing federal tax credit. That credit ties to your mortgage interest, effectively lowering your tax bill every year you hold the loan. Some buyers combine an MCC with a down payment assistance program. However, not every combination is available through every lender, so this is worth confirming early.
How Down Payment Assistance Actually Works
Most Texas programs structure assistance as a deferred, zero-interest second lien, not money simply handed over. In practice, that means you don’t make monthly payments on the assistance itself. Instead, it generally comes due when you sell, refinance, or pay off your primary mortgage. Some programs offer a forgivable structure instead. Under that structure, the assistance gets forgiven after a set number of years if you stay in the home. Because the details vary by program, know exactly which structure you’re agreeing to.
Eligibility Requirements Across Programs
Most programs share a similar baseline. That includes a 620 minimum credit score, an approved homebuyer education course, and county-specific income and purchase price limits. However, exact figures shift by program and by county, and requirements can change. Confirming current numbers directly matters more here than in almost any other part of the home buying process.
Can You Combine Assistance With FHA or Conventional Loans?
Generally, yes. Most Texas down payment assistance programs pair with either FHA or conventional financing. That said, the specific combination available can depend on the lender and the exact assistance program chosen. Confirm this pairing early, before you fall in love with a specific home. Doing so keeps your financing plan realistic from the start.
FHA vs. Conventional: Which Is Better for a First-Time Buyer?
Common Mistakes When Using Down Payment Assistance
The most common mistake is assuming assistance funds are a grant. In reality, they’re often a deferred loan that comes due later. A second common mistake is skipping the county-specific income and purchase price limits. These limits vary by county and can rule out an otherwise perfect property.
Mortgage Planner’s Perspective
Down payment assistance can genuinely change what’s possible for a first-time buyer. That’s only true, though, when the structure is understood clearly from the start. Knowing whether you’re receiving a grant or a deferred loan matters. So does knowing what triggers repayment, just as much as knowing you qualify in the first place.
NEXT STEP
Curious which down payment assistance program actually fits your situation? Our free Homebuyer’s Planning Guide walks through your options.
Or talk it through directly with a mortgage planning consultation.
RELATED ARTICLES
How Much Down Payment Does a First-Time Homebuyer Need in Texas?
FHA vs. Conventional: Which Is Better for a First-Time Buyer?
The Complete Guide to Buying Your First Home in Texas
First-Time Homebuyer Mistakes to Avoid
FREQUENTLY ASKED QUESTIONS
The Programs
Q: What down payment assistance programs are available in Texas?
A: The two major providers are TDHCA (My First Texas Home) and TSAHC (Home Sweet Texas and Homes for Texas Heroes), each offering assistance of up to roughly 5% of your loan amount.
Q: Is down payment assistance free money?
A: Not usually. Most Texas programs structure assistance as a deferred, zero-interest second lien that comes due when you sell, refinance, or pay off your home, rather than a grant.
Eligibility and Combining Programs
Q: What credit score do I need for down payment assistance?
A: Most programs require a minimum 620 credit score, along with completion of an approved homebuyer education course.
Q: Can I use down payment assistance with an FHA loan?
A: Generally, yes. Most Texas assistance programs pair with either FHA or conventional financing, though the exact combination available can depend on your lender.
Q: Are there income limits for these programs?
A: Yes, and they vary by county and by program. Confirming your specific county’s current limits before assuming eligibility is an important early step.
Texas Mortgage Plan – 50+ years of combined mortgage experience, serving homeowners and homebuyers across Flower Mound and the DFW Metroplex. Elizabeth Rose, NMLS 252686, CDLP® Certified Divorce Lending Professional | Shea Patton, Mortgage Advisor, NMLS #251397, Licensed Realtor. Texas Mortgage Plan is a d/b/a of Legacy Mortgage, NMLS #1759275 | Equal Housing Lender