Buying a home in Texas is a big dream for a lot of people — and the good news is that Texas has some of the best down payment assistance programs in the entire country. I’ve seen buyers save $15,000 or more just by knowing about these programs before they started looking at homes. If you’re a first-time buyer in Texas, this guide is exactly what you need.
What Are Texas Down Payment Assistance Programs?
How Down Payment Assistance Works in Texas
Down payment assistance (DPA) programs are designed to help homebuyers cover the upfront cost of buying a home. These costs — which include your down payment and closing costs — can easily run $10,000 to $20,000 or more depending on the purchase price. For many first-time buyers, these upfront costs are the biggest barrier between them and homeownership.
Texas down payment assistance comes in different forms. Some programs are grants you never have to repay. Others are forgivable loans that disappear after a few years. And some are low-interest second mortgages that you pay off over time. Each type works differently, but they all help lower what you need to bring to closing.
Who Administers These Programs in Texas?
The main agency running Texas home buyer programs is the Texas Department of Housing and Community Affairs (TDHCA). According to TDHCA, the department was created to provide affordable housing options and homeownership opportunities for Texans across the state, with specific programs targeting low- to moderate-income buyers.
Beyond TDHCA, many Texas cities and counties also have their own local programs — and in some cases, you can combine state and local assistance to cover even more of your upfront costs.
Top Texas Down Payment Assistance Programs
My First Texas Home Program
This is one of the most popular programs for first-time buyers in Texas. The My First Texas Home program offers a 30-year, fixed-rate mortgage with a down payment and closing cost assistance of up to 5% of the loan amount. That assistance comes as a second loan with 0% interest and no monthly payments — it’s only repaid when you sell, refinance, or pay off the home.
Here’s what makes this program stand out: you can combine it with a Mortgage Credit Certificate (MCC), which gives you a federal tax credit of up to $2,000 per year for the life of your loan. That’s thousands of dollars back in your pocket over time, on top of the upfront help.
My Choice Texas Home Program
Not a first-time buyer? No problem. The My Choice Texas Home program works just like My First Texas Home but it’s open to all eligible buyers, not just first-timers. You still get the 30-year fixed mortgage and up to 5% in down payment assistance. It’s a great option if you owned a home before but are buying again after a gap.
Both programs are part of The Texas Homebuyer Program, which is managed by TDHCA and available through participating lenders statewide. According to the U.S. Department of Housing and Urban Development (HUD), programs like these help buyers with limited savings access financing that would otherwise be out of reach.
Texas DPA Programs: Quick Comparison Table
Side-by-Side View of Main Programs
| Program | Max Assistance | Open To | Interest Rate (Assistance) | Repayment |
|---|---|---|---|---|
| My First Texas Home | Up to 5% of loan | First-time buyers | 0% | On sale/refi |
| My Choice Texas Home | Up to 5% of loan | All eligible buyers | 0% | On sale/refi |
| HTF Homebuyer Assistance | Up to $10,000 | First-time buyers + veterans | 0% | After 61 months of senior loan |
| Texas Bootstrap Loan | Up to $45,000 | Very low-income buyers | 0% | Up to 30 years |
| Local City/County Programs | Varies | Varies by location | Varies | Varies |
Texas Housing Trust Fund Homebuyer Assistance (HTF HBA)
This program specifically targets first-time homebuyers and veterans whose income is at or below 80% of the Area Median Family Income. It provides up to $10,000 in a zero-interest loan for down payment and closing cost assistance. The repayment starts no earlier than 61 months after the first payment of the senior lien loan — so you have several years before you even need to think about it.
This is a great option for buyers who need a real boost but also want a manageable repayment structure. The key requirement is income — you must be under 80% AMI for your area.
City and Local Texas Down Payment Programs
Local Assistance Programs Worth Knowing
Many Texas cities and counties have their own assistance programs that can often be layered on top of state programs. Here are some of the bigger ones:
- City of Houston: Offers the Homebuyer Assistance Program (HAP) with forgivable loans for income-qualifying buyers
- Dallas: Provides down payment assistance through the Dallas Homebuyer Assistance Program (DHAP) for buyers in specific income brackets
- Austin: Has the Neighborhood Housing and Community Development (NHCD) program with forgivable second mortgages
- San Antonio: Offers the Homeownership Incentive Program (HIP) with up to $15,000 in assistance for eligible buyers
- Fort Worth: Provides assistance through the Homebuyer Assistance Program for low-to-moderate income buyers
The programs listed above change from time to time based on available funding. Always check directly with your city’s housing department or a HUD-approved housing counselor for the most current information.
Federal Programs Available to Texas Buyers
On top of state and local options, federal programs are a huge part of the Texas home buying landscape:
- FHA Loans: Only 3.5% down with a credit score of 580 or higher — very popular with first-time Texas buyers
- VA Loans: Zero down payment for veterans, active military, and qualifying spouses
- USDA Loans: Zero down for buyers in eligible rural areas across Texas — and a big portion of Texas qualifies
- Fannie Mae HomeReady: As low as 3% down for income-qualified buyers with flexible guidelines
- Freddie Mac Home Possible: Similar to HomeReady, great for buyers in underserved areas
How to Qualify for Texas Down Payment Assistance
Basic Eligibility Requirements
Most Texas DPA programs share a core set of requirements. Understanding these upfront saves you time and helps you prepare before you apply. Here’s what you generally need:
- Minimum credit score of 620 (some programs require 640)
- Household income at or below the program’s income limit for your county
- The property must be in Texas and used as your primary residence
- Completion of a HUD-approved homebuyer education course
- Purchase price must be within the program’s loan limits
- You must work with an approved participating lender
One thing I tell everyone: take the homebuyer education course before you do anything else. It’s required anyway, and it helps you understand the full process so you don’t make rookie mistakes.
Step-by-Step Application Process
Getting Texas down payment assistance isn’t complicated, but there are steps to follow in the right order:
- Check your credit score and work on improving it if needed
- Gather income and employment documents (pay stubs, tax returns, bank statements)
- Complete a homebuyer education course from a HUD-approved provider
- Find an approved lender through the TDHCA or Texas Homebuyer Program website
- Apply for the mortgage and DPA program together through your lender
- Your lender will match you with the programs you qualify for and submit on your behalf
Understanding the full closing process is just as important as the application. You can learn about how home ownership situations can change and what to watch out for as a new buyer in any state.
Tips to Get the Most Out of Texas DPA Programs
Smart Moves Before You Apply
I’ve talked to a lot of buyers who almost missed out on thousands of dollars in assistance just because they didn’t plan ahead. Here’s what actually works:
- Get your credit score up before applying — even 20 extra points can make a big difference
- Don’t make any large purchases or open new credit accounts before closing
- Save at least 1–2% of the purchase price on your own — some programs still require a small personal contribution
- Ask your lender if you can combine the My First Texas Home program with a Mortgage Credit Certificate
- Apply early in the year when program funding is freshest
The Texas Bootstrap Loan Program is a unique option for very low-income buyers willing to provide sweat equity. Under this program, you can borrow up to $45,000 at 0% interest if you contribute at least 65% of the labor to build or fix your home. It’s not for everyone, but it’s one of the most generous programs in the state.
Common Mistakes Texas First-Time Buyers Make
Knowing what not to do is just as important. Here are the traps I’ve seen buyers fall into:
- Assuming they earn too much to qualify without actually checking the income limits
- Not completing the homebuyer education course before applying
- Using a lender who isn’t approved for TDHCA programs
- Not asking about the Mortgage Credit Certificate — it’s free money left on the table
- Choosing a home above the program’s purchase price limit
If you’re also considering buying a home that needs work, read about buying a foreclosed home as a beginner — Texas has plenty of foreclosure opportunities that can work well with DPA programs.
Texas DPA for Veterans and Special Groups
Extra Help Available for Veterans and Heroes
Texas is one of the most veteran-friendly states in the country for home buying. Beyond the federal VA loan, Texas has the Texas Veterans Land Board (VLB) which offers its own competitive mortgage programs for eligible Texas veterans. These include low-interest home loans, land loans, and home improvement loans — many of which can be combined with DPA programs.
Veterans using a VA loan can also use down payment assistance programs in many cases — though the specific rules depend on the program. Ask your lender about combining VA financing with local grant programs for the best outcome.
What Happens After You Receive Assistance?
Once you receive down payment assistance and close on your home, there are usually some rules to follow:
- You must live in the home as your primary residence — usually for a minimum period
- If you sell before the required period, you may need to repay some or all of the assistance
- Refinancing may also trigger repayment depending on the program
- Keep up with your mortgage payments — defaulting could affect your assistance terms
If you need guidance on your specific situation, our team is ready to help. Contact us today and we’ll connect you with the resources you need to make a smart home buying decision in Texas.
You can also explore all of the home buying and selling resources we offer by visiting our property resources page for more guidance tailored to your situation.
According to The Texas Homebuyer Program (the official site run by TDHCA), the program provided more than $1.7 billion in homeowner financing and down payment assistance in Fiscal Year 2022 alone — showing just how much support is available to Texas buyers who know where to look.
Conclusion
Texas has some of the strongest down payment assistance programs in the United States. Whether you use the My First Texas Home program, combine it with a Mortgage Credit Certificate, or tap into local city programs, there’s real help out there for first-time buyers. The key is knowing what’s available, preparing early, and working with an approved lender who specializes in these programs. Don’t let down payment costs stop you from buying a home in Texas — the assistance is waiting for you.
Frequently Asked Questions
Who qualifies for Texas down payment assistance?
Most programs require you to be a first-time homebuyer (or not have owned a home in the last 3 years), meet income limits for your county, have a minimum credit score of 620–640, and complete a HUD-approved homebuyer education course. Veterans may have additional options through the Texas Veterans Land Board.
How much down payment assistance can I get in Texas?
It depends on the program. The My First Texas Home program offers up to 5% of the loan amount. The HTF Homebuyer Assistance program provides up to $10,000. Local city programs can add thousands more on top. In some cases, buyers can stack multiple programs for maximum help.
Do I have to pay back Texas down payment assistance?
It depends on the program. Many Texas programs offer 0% interest second loans that are only repaid when you sell, refinance, or pay off your home. Some local programs offer fully forgivable loans if you stay in the home for the required period. Always ask your lender for the exact repayment terms before you sign anything.
Can I use Texas down payment assistance with an FHA loan?
Yes. Most Texas DPA programs are compatible with FHA loans, and many are also compatible with conventional, USDA, and VA loans. Your participating lender will help you find the right loan and assistance combination for your situation.
How long does it take to get approved for Texas down payment assistance?
The full process from application to closing typically takes 30 to 60 days. Since the assistance is applied at closing rather than given to you as cash, it’s processed as part of your mortgage transaction. The key is starting early and working with an approved lender who knows the program requirements.