How does down payment assistance work in Texas?

Texas down payment assistance (DPA) helps eligible buyers cover the down payment and closing costs, usually as a second lien behind the main mortgage. Statewide programs from TDHCA and TSAHC offer assistance of up to 5% of the loan amount as a grant, a forgivable second lien, or a deferred second lien repaid when you sell or refinance. Cities and counties add local programs. Income, purchase price, and credit requirements apply.

The ways Texas DPA is structured.

How the assistance is repaid matters more than the headline amount. These are the structures Texas programs use:

Texas down payment assistance structures
Structure	How it works	When it is repaid
Grant	A gift toward the down payment and closing costs (TSAHC)	Never
3-year forgivable second lien	No interest and no monthly payment; forgiven after three years (TDHCA, TSAHC)	Only if you sell, refinance, or move out within the three years
30-year deferred second lien	No interest and no required monthly payment (TDHCA, TSAHC)	In full when you sell, refinance, or pay off the first mortgage
Local forgivable loan	City programs, such as San Antonio's, forgive the assistance over a set number of years	A prorated share if you sell, transfer, or take a cash-out refinance early

Who qualifies for DPA in Texas?

Each program sets its own rules, but most check the same items:

Household income within the county limit for your household size
A purchase price within the program limit
A minimum credit score, commonly 620 for government loans
Completion of a HUD-certified homebuyer education course
The home is your primary residence
First-time buyer status for some programs, though several statewide options are open to repeat buyers

What DPA can and cannot pay for.

Assistance can cover the minimum down payment and eligible closing costs. It is not a source of cash back: under TDHCA rules, assistance generally cannot be paid to you in cash beyond reimbursing items such as earnest money, and any excess is typically applied to the loan balance.

Tradeoffs to compare before you use it.

Assistance makes buying possible sooner, but it is not free of tradeoffs. Assisted loans can be priced differently from an unassisted loan, a second lien affects when and how you can refinance, and forgivable assistance only stays forgiven if you meet the occupancy terms.

The useful comparison is the full Loan Estimate for an assisted loan against one without assistance, over the number of years you expect to keep the home.

Statewide and local DPA can combine.

TDHCA lists Capital Area Housing Finance Corporation gift funds that add to its loans in nine Central Texas counties, subject to availability, and city programs in San Antonio, Houston, and Dallas run alongside the statewide options. Combining sources takes coordination between the lender and each program, so start early.

Common questions.

General answers — your situation deserves a specific one. Bryan is a call away.

Is Texas down payment assistance a grant?

Some is. TSAHC offers grants that are not repaid. Other assistance is a second lien that is forgiven after a set period or repaid when you sell or refinance. Read the repayment terms before choosing.

Can I get down payment assistance in Texas if I have owned a home before?

Yes. My Choice Texas Home and TSAHC's Homes for Texas Heroes and Home Sweet Texas programs are open to repeat buyers. Some TDHCA and city programs require first-time buyer status.

Can I use Texas DPA with an FHA, VA, USDA, or conventional loan?

Yes, depending on the program. TDHCA's My First Texas Home pairs with FHA, VA, and USDA loans. My Choice Texas Home and TSAHC programs also offer conventional options.

Does down payment assistance change my mortgage terms?

Assisted loans can be priced differently from unassisted loans, and the difference depends on the program and the assistance level. Compare both versions on your Loan Estimate before deciding.

How long does Texas down payment assistance take?

The assistance is reserved by your lender once you are under contract and closes with your mortgage. Completing the homebuyer education course and gathering documents early keeps it from slowing down closing.

Who offers Texas down payment assistance?

TDHCA and TSAHC fund the statewide programs, which are delivered through their approved participating lenders. Bryan Bowman, NMLS #1473913, is licensed in Texas and can talk through how these programs compare with standard loan options.

Can down payment assistance and an MCC be used together in Texas?

In some combinations. TDHCA offers My First Texas Home together with an MCC, and TSAHC requires its MCC to be paired with TSAHC assistance. A stand-alone TDHCA MCC cannot be combined with outside assistance.

Is there down payment assistance for Texas veterans?

Yes. Veterans can use My First Texas Home without meeting the first-time buyer rule, qualify for Homes for Texas Heroes, and may qualify for a Texas Mortgage Credit Certificate.

Does Texas down payment assistance cover the whole down payment?

Statewide assistance is a share of the loan amount, up to 5%. That can cover the minimum down payment on FHA, VA, USDA, or low-down-payment conventional loans, with the rest going toward eligible closing costs.

Closely related guides on the same decision.

First-Time Home Buyer Programs in Texas

Texas has two statewide sources of first-time buyer help. The Texas Department of Housing and Community Affairs (TDHCA) runs My First Texas Home, My Choice Texas Home, and the Texas Mortgage Credit Certificate. The Texas State Affordable Housing Corporation (TSAHC) runs Homes for Texas Heroes and Home Sweet Texas. Most pair a 30-year fixed-rate mortgage with down payment and closing cost assistance of up to 5% of the loan amount, and many Texas cities and counties add programs of their own. Eligibility depends on income, purchase price, credit, and county.

First-Time Home Buyer Programs in San Antonio

The City of San Antonio's Neighborhood and Housing Services Department runs the Homeownership Incentive Program (HIP) for first-time buyers. It has two tiers: HIP 80 for households at or below 80% of area median income, and HIP 120 for households up to 120%. Both provide down payment and closing cost assistance as a no-interest, no-payment second lien that is largely forgiven over time. San Antonio buyers can also use statewide programs from TDHCA and TSAHC.

Get answers about your situation.

Guides explain the general rules. A short conversation with Bryan tells you how they apply to you — no obligation, no pressure.

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