Homebuyer Assistance Programs in Texas: Grants, Loans & Help 2026

Quick answer: Texas offers some of the most generous homebuyer assistance in the country. Two state agencies — TSAHC and TDHCA — provide down payment grants up to 5% of your loan amount, deferred zero-interest second liens, and annual federal tax credits worth up to $2,000. Local city and county programs can add even more. Most programs require a 620 credit score and a homebuyer education course. Here's every program, who qualifies, and how to apply.

Buying a home in Texas in 2026 is challenging but far from impossible. The 30-year fixed-rate mortgage averaged 6.69% as of August 6, 2026, according to Freddie Mac's Primary Mortgage Market Survey — up slightly from 6.66% the prior week and 6.63% a year ago. Home prices in the Austin metro hover around a median of $450,000 as of spring 2026 (Austin Board of Realtors via ACTRIS). For many families — especially Hispanic and first-time buyers — the biggest barrier isn't the monthly payment. It's the upfront cash: down payment, closing costs, and reserves.

Here's the good news most buyers never hear: Texas has multiple state and local programs that can cover your entire down payment and part of your closing costs. Some of this money is a grant you never repay. Some is a zero-interest deferred loan you only pay back when you sell or refinance. And it's available right now, not in some future budget cycle.

This guide breaks down every major program, how they work, who qualifies, and how to stack them for maximum benefit.

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The Two State Agencies: TSAHC and TDHCA

Texas runs its homebuyer assistance through two organizations:

• TSAHC — Texas State Affordable Housing Corporation, a nonprofit created by the Texas Legislature
• TDHCA — Texas Department of Housing and Community Affairs, the state's housing agency

They operate independently but serve overlapping missions. You apply through approved lenders, not directly through the agencies. Let's break down each one.

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TSAHC Programs: Grants and Deferred Liens

TSAHC runs two main programs, both offering 30-year fixed-rate mortgages paired with down payment assistance:

1. Home Sweet Texas Home Loan Program

Open to all Texas homebuyers who meet income limits. This is the program most people qualify for.

What it offers:

• 30-year fixed-rate first mortgage (FHA, VA, USDA, or conventional)
• Down payment assistance of 3% to 5% of the loan amount
• Two DPA structures to choose from:
  • Grant — true grant, no repayment ever
  • Deferred second lien — 0% interest, no monthly payment, repaid when you sell or refinance

The tradeoff: If you choose the grant, your first mortgage rate is slightly higher. If you choose the deferred lien, you get a lower first mortgage rate but owe the DPA amount back later. Which is better depends on how long you plan to stay in the home.

Current TSAHC rates (August 2026):

DPA Type	Loan Type	Min FICO	Rate
0% DPA	FHA/USDA/VA	620	6.375%
0% DPA	Conventional (above 80% AMFI)	640	6.625%
0% DPA	Conventional (80% AMFI and below)	640	6.500%
3% Grant	FHA/USDA/VA	620	7.125%
5% Deferred 2nd Lien (30-yr)	FHA/USDA/VA (Bond)	620	6.625%
5% Deferred Forgivable 2nd Lien (3-yr)	FHA/VA/USDA	620	7.125%

2. Homes for Texas Heroes Home Loan Program

Same structure as Home Sweet Texas, but exclusively for:

• Teachers
• Firefighters and EMS personnel
• Police and correctional officers
• Veterans

The Heroes program adds one significant benefit: the Mortgage Credit Certificate (MCC) is free. For everyone else, the MCC has a cost.

Mortgage Credit Certificate (MCC)

The MCC is a federal tax credit worth 15% of your annual mortgage interest, capped at $2,000 per year. It reduces your federal tax liability dollar-for-dollar. On a $337,750 loan at 6.69%, your annual interest is roughly $22,600 — 15% of that is $3,390, but the cap means you get $2,000 back per year.

The MCC must be combined with TSAHC's Down Payment Assistance — it's no longer available as a stand-alone product.

TSAHC Income Limits

TSAHC recently raised the income ceiling from 115% to 125% of Area Median Family Income (AMFI), which moved tens of thousands of Texas households into eligibility for the first time. Limits vary by county and household size.

For Travis County (Austin), the non-targeted area income limit is approximately $167,250. That's higher than most people expect — you don't have to be low-income to qualify.

TSAHC Key Requirements

• Credit score: 620 minimum for FHA/VA/USDA; 640 for conventional
• DTI: No maximum with AUS approval; FHA manual underwrites allowed up to 43% DTI
• Occupancy: Must be your primary residence
• First-time buyer: Required for the 80% AMFI conventional option; otherwise not required
• Homebuyer education: Required for MCC

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TDHCA Programs: My First Texas Home and My Choice Texas Home

TDHCA operates through "The Texas Homebuyer Program" and offers two tracks:

1. My First Texas Home

For first-time homebuyers (no homeownership in the past 3 years). Veterans and buyers in targeted areas are exempt from the first-time requirement.

What it offers:

• 30-year fixed-rate mortgage (FHA, VA, USDA, or conventional)
• Down payment assistance up to 5% of the loan amount as a deferred 0% interest second lien
• No monthly payments on the DPA — you repay only when you sell, refinance, or pay off the mortgage
• Forgivable after the required occupancy period (typically 3 years)

Example: On a $300,000 loan, 5% DPA = $15,000. That covers the entire 3.5% FHA down payment ($10,500) and puts $4,500 toward closing costs.

2. My Choice Texas Home

Same structure as My First Texas Home, but open to repeat buyers — you don't need to be a first-time homebuyer. This is critical for families who owned a home years ago, lost it during a hardship, and are ready to buy again.

TDHCA Mortgage Credit Certificate

TDHCA also offers an MCC worth up to $2,000 per year in federal tax credits. Available to Veterans and first-time homebuyers with a first mortgage through the program, or as a stand-alone option. No minimum credit score requirement with the stand-alone option — but supplies are limited.

TDHCA Income and Purchase Price Limits (2026)

Metro Area	1-2 Person Income	3+ Person Income	Max Purchase Price
Austin / Travis County	$115,200	$132,480	$472,030
Dallas-Fort Worth / Tarrant	$103,200	$118,680	$420,000
Houston / Harris County	$97,000	$111,550	$400,000
San Antonio / Bexar	$91,200	$104,880	$375,000
El Paso County	$82,800	$95,220	$325,000
Most Rural Counties	$82,800	$95,220	$350,000

Source: TDHCA 2026 guidelines via mortgage-info.com. Verify with a TDHCA-approved lender for your specific county.

TDHCA Key Requirements

• Credit score: 620 minimum
• Homebuyer education: Required (online courses like eHome America or Framework, ~$75, 6-8 hours)
• Occupancy: Primary residence only
• Loan types: FHA, VA, USDA, or conventional
• Closing timeline: 45-60 days typical

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Local Programs: City and County Assistance

Beyond the state programs, several local governments in Central Texas run their own DPA funds:

City of Austin DPA

• Amount: Up to $40,000
• Structure: Zero-percent deferred loan, forgivable after 10 years if you remain in the home
• Income limit: 80% of Area Median Income (AMI) for your household size
• Purchase price cap: Approximately $579,025
• Eligibility: First-time homebuyer (no ownership in past 3 years), must purchase within Austin city limits
• Availability: Funds open periodically and can exhaust within weeks. Monitor the City of Austin Housing Department website for openings.

Travis County DPA

Travis County offers additional DPA funds that can stack on top of state programs. These are typically deferred loans with forgiveness periods. Check the Travis County Housing Services page for current availability.

Williamson County

DPA funds available for buyers in Round Rock, Georgetown, Cedar Park, and Leander. Programs vary by city and open intermittently.

Hays County

Programs available for buyers in Kyle, Buda, and San Marcos. Income limits and structure vary.

Important: Local funds aren't always active. They open in rounds and can exhaust quickly. Work with a lender who tracks these programs so you can apply the moment funds reopen.

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How the Math Works: A Real Example

Let's say you're buying a $350,000 home in Pflugerville with an FHA loan:

Line Item	Amount
Home price	$350,000
FHA down payment (3.5%)	$12,250
TSAHC 5% grant	$17,500
Cash needed for down payment	$0
Remaining DPA for closing costs	$5,250

Your out-of-pocket cash for the down payment drops to zero. You still need funds for some closing costs and prepaid items (escrow, insurance, etc.), but the DPA grant covers a massive portion.

On a $450,000 home (closer to Austin's median), the math still works:

Line Item	Amount
Home price	$450,000
FHA down payment (3.5%)	$15,750
TSAHC 5% grant	$22,500
Cash needed for down payment	$0
Remaining DPA for closing costs	$6,750

The catch: When you choose a TSAHC grant, your first mortgage rate runs about 0.25%–0.50% above a standalone FHA rate. On a $337,750 loan (after 3.5% down on a $350K home), that's roughly $60–$120 more per month. For buyers who don't have $12,000 in savings, that tradeoff makes complete sense.

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Can You Stack Programs?

Yes — in many cases, you can combine:

• A TDHCA or TSAHC first mortgage + DPA
• A local city/county DPA on top
• An MCC for annual tax savings
• Seller concessions (up to 6% on FHA) toward closing costs

This stacking capability is how some buyers get into homes with less than $1,000 out of pocket.

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Common Myths That Cost Buyers Money

"I make too much to qualify."

Travis County's TSAHC income limit is approximately $167,250. TDHCA's Travis County limit is $115,200 for 1-2 person households and $132,480 for 3+. If your household income is under those numbers, you likely qualify. Run the numbers before assuming you're out.

"I'm not a first-time buyer, so I can't get help."

Two programs — TDHCA's My Choice Texas Home and TSAHC's Home Sweet Texas — are open to repeat buyers. If you owned a home years ago but have been renting since, you may qualify for both.

"Down payment assistance is a scam."

It isn't. TSAHC and TDHCA are state-created entities funded through mortgage revenue bonds. The programs are regulated, transparent, and have helped tens of thousands of Texas families buy homes. The money is real.

"I need 20% down."

You don't. FHA requires 3.5%. Conventional can go as low as 3%. VA and USDA require 0%. And DPA programs can cover all of it. The 20% myth keeps thousands of families renting when they could be building equity.

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Step-by-Step: How to Apply

Step 1: Complete Homebuyer Education

Both TSAHC and TDHCA require a HUD-approved homebuyer education course. Online options include:

• eHome America — ~$75, available in English and Spanish
• Framework — ~$75, 6-8 hours, self-paced

Your certificate is valid for one year.

Step 2: Find an Approved Lender

Not all lenders offer TSAHC or TDHCA programs. Both agencies maintain lists of approved lenders on their websites:

• TSAHC: tsahc.org/lenders
• TDHCA: welcomehome.tdhca.texas.gov

A lender experienced with DPA programs can run both grant and deferred-lien scenarios so you can compare.

Step 3: Get Pre-Approved

Your lender will review your income, credit, and assets, then determine which programs you qualify for. This is also when you'll know your purchase price limit — DPA programs have caps.

Step 4: Choose Your Program and DPA Structure

With your lender, decide:

• Which first mortgage (FHA, VA, USDA, or conventional)
• Which DPA type (grant vs. deferred lien)
• Whether to add the MCC for tax savings
• Whether local city/county funds are available to stack

Step 5: Find a Home Within Price Limits

Shop within your county's purchase price limit. The home must be your primary residence — single-family, condo, townhome, or new construction all qualify.

Step 6: Close and Move In

TDHCA loans typically take 45-60 days to close. The DPA is recorded as a second lien (for deferred options) or applied as a grant at closing. No monthly payments on the DPA.

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Special Programs for Hispanic and Immigrant Buyers

Several programs specifically help Hispanic and immigrant families:

• ITIN loans — available to buyers without a Social Security Number who file taxes with an ITIN. These are separate from TSAHC/TDHCA but can be combined with some local DPA programs.
• Spanish-language homebuyer education — both eHome America and Framework offer courses in Spanish. TDHCA provides Spanish-language support through its program.
• Bilingual approved lenders — many TSAHC and TDHCA-approved lenders serve Spanish-speaking clients. This is critical for understanding complex program requirements in your language.

If you're an immigrant with a Green Card or ITIN, you can buy a home in Texas. Your pathway depends on your residency status, credit history, and income documentation — but the DPA programs described above are available to all U.S. residents who meet the criteria.

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What to Do Right Now

If you're planning to buy a home in Texas in 2026, start with three actions:

1. Check your eligibility. Take the TSAHC eligibility quiz at tsahc.org and review TDHCA income limits for your county. This takes 10 minutes.

2. Complete homebuyer education. The $75 course is required for most programs and gives you the certificate you need for pre-approval. Do it before you start house-hunting.

3. Talk to a DPA-approved lender. A lender who works with these programs can tell you in one conversation exactly what you qualify for, how much assistance you'd receive, and what your monthly payment would look like.

Don't wait until you've saved 20% — that day may never come, and it doesn't need to. Texas has built these programs specifically to help working families buy homes. The money is there. The programs are active. The only thing standing between you and homeownership might be not knowing they exist.

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Frequently Asked Questions

What is the difference between a grant and a deferred lien?

A grant is money you never repay. A deferred lien is a 0% interest second loan with no monthly payments — you repay the principal when you sell, refinance, or pay off your first mortgage. Grants come with a slightly higher first mortgage rate; deferred liens come with a lower rate.

Can I use down payment assistance with an FHA loan?

Yes. Most Texas DPA programs are specifically designed to pair with FHA loans. FHA's 3.5% minimum down payment is fully coverable with a 3.5%+ DPA grant.

Do I have to be a first-time homebuyer?

Not always. TDHCA's My Choice Texas Home and TSAHC's Home Sweet Texas are open to repeat buyers. My First Texas Home requires no homeownership in the past 3 years, but Veterans and buyers in targeted areas are exempt.

How much assistance can I get?

Most programs offer 3% to 5% of the loan amount. On a $300,000 loan, that's $9,000 to $15,000. The City of Austin adds up to $40,000 on top of state programs for qualifying buyers.

What credit score do I need?

620 is the minimum for most programs. Some FHA pairings work with 580+. A score of 680+ gets you better rates. If you're close to a threshold, spending a few months improving your credit can save you thousands.

Are these programs available outside Austin?

Yes. TSAHC and TDHCA programs are statewide. Income and purchase price limits vary by county, but every Texas county has access. Local city and county programs exist in many areas — check with your local housing department.

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Sources: Freddie Mac PMMS (August 6, 2026); TSAHC.org home buyer programs page (accessed August 2026); TDHCA welcomehome.tdhca.texas.gov (accessed August 2026); TSAHC Combined Income and Purchase Price Limits (effective June 13, 2026); Austin Board of Realtors / ACTRIS market data (April 2026). Rates and program details are subject to change — verify with an approved lender before applying.

About Sully Realty Group

At Sully Realty Group, we specialize in helping Central Texas families — especially Hispanic and first-time buyers — navigate the homebuying process from start to finish. Our bilingual team works with TSAHC and TDHCA-approved lenders every day, and we help buyers stack state, county, and city assistance programs to minimize out-of-pocket costs. Whether you're in Austin, Round Rock, Georgetown, Cedar Park, or anywhere in the Austin metro, we can guide you through every program described in this guide. Contact us to start your pre-approval conversation.

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Sources:

• Freddie Mac Primary Mortgage Market Survey — August 6, 2026
• TSAHC Home Buyer Programs
• TSAHC Income and Purchase Price Limits (effective June 13, 2026)
• TDHCA Texas Homebuyer Program
• TDHCA Program Details
• City of Austin Down Payment Assistance

This post is for informational purposes only and does not constitute financial advice or a guarantee of loan approval. Program availability, income limits, and rates change. Consult a licensed mortgage professional for current terms.

TREC Disclaimer: Sully Ruiz is a licensed real estate broker in the State of Texas (Texas Real Estate Commission License #XXX). All information in this post is believed to be accurate but is not guaranteed and should be independently verified. All real estate listings are subject to prior sale, change, or withdrawal without notice. Equal Housing Opportunity.