Texas First-Time Homebuyer and Down Payment Assistance Programs (2026 Guide)

The quick answer: Texas has two state agencies running homebuyer programs: TDHCA (Texas Department of Housing and Community Affairs) and TSAHC (Texas State Affordable Housing Corporation). Both offer assistance of up to 5% of your loan amount toward your down payment and closing costs, paired with a fixed-rate first mortgage. Income limits apply and vary by county and household size. You use these programs through a participating lender.

TDHCA: My First Texas Home and My Choice Texas Home

My First Texas Home is for first-time buyers, meaning you haven't owned your primary residence in the past three years. TDHCA waives that requirement for qualified veterans and for homes in targeted areas. It pairs an FHA, VA or USDA 30-year fixed loan with assistance of up to 5% of the loan amount.

The assistance comes as a 0% interest second lien with no monthly payment, in one of two forms:

• 30-year deferred, repayable: due when you sell, refinance or pay off the first mortgage.
• 3-year deferred, forgivable: forgiven after 36 months as long as the home is still your primary residence and you're current on the first loan.

My Choice Texas Home works similarly but doesn't require you to be a first-time buyer, and it adds a conventional option. TDHCA updated its income and purchase price limits effective July 13, 2026. TDHCA's program chart lists a 620 minimum credit score and a 50% max debt-to-income ratio.

TSAHC: Homes for Texas Heroes and Home Sweet Texas

Homes for Texas Heroes is for teachers and other educators, police officers, firefighters, EMS, corrections officers, county jailers and veterans. Home Sweet Texas is for low- and moderate-income Texans who don't fit those professions. Both are open to first-time and repeat buyers.

Assistance is up to 5% of the loan amount, either as a grant you never repay or a second lien that's forgiven after three years if you don't sell, refinance or move out. TSAHC sets income limits at 150% of area median income for Home Sweet Texas and 170% for Homes for Texas Heroes, and lists 620 minimum credit for government loans and 640 for conventional. TSAHC also offers Mortgage Credit Certificates, which can reduce your federal income tax.

Which one should you use?

There isn't a universal winner. Here's how I think about it with clients:

• Are you a teacher, first responder or veteran? Start with Homes for Texas Heroes and compare it to My First Texas Home.
• Have you owned a home in the last three years? My Choice Texas Home or the TSAHC programs, since they don't require first-time buyer status.
• Do you plan to stay at least three years? The forgivable options become a lot more attractive.
• Compare the whole package. The assistance amount matters, but so do the rate and fees on the first mortgage. Sometimes a regular loan with seller concessions comes out cheaper. I'll run both side by side.

What about local programs in Collin County?

Some cities and counties run their own assistance, and TDHCA's program matrix lists additional local gift funds through partner housing finance corporations, subject to availability. These change, so ask me what's open when you're ready to buy.

Common mistakes with Texas assistance programs

• Waiting until after the offer to ask. Not every lender participates, and the program has to be set up from the start of the loan.
• Forgetting household income. Some programs count income from everyone who'll be on title, not just the borrowers on the loan.
• Ignoring the purchase price limit. TDHCA's bond-funded programs cap the price of the home by county. Know the number before you fall in love with a house.
• Selling or refinancing too soon. If your assistance is a forgivable second lien, refinancing or selling before it's forgiven means it comes due.

What you'll need to get started

1. Recent pay stubs, W-2s and two years of tax returns.
2. Bank statements.
3. A homebuyer education course (required for TDHCA's programs).
4. A pre-approval from a lender that participates in the program.

Program terms, limits and availability change during the year, so treat this as a starting point and verify with the official links below or with me before you write an offer.

Frequently Asked Questions

Sources

• TDHCA: The Texas Homebuyer Program
• TDHCA: Program Lender Guide
• TDHCA: Programs at a glance
• TDHCA: Income and Purchase Price Limits (effective July 13, 2026)
• TSAHC: Homes for Texas Heroes
• TSAHC: Home Sweet Texas
• TSAHC: 2026 Income and Purchase Price Limits

Information current as of October 2026 and subject to change. For information purposes only; this is not a commitment to lend or extend credit. All loans subject to credit approval. Keith Sullivan, NMLS# 2451429, NXT Mortgage NMLS# 1660690. Equal Housing Opportunity.