Texas Down Payment Assistance Programs: A 2026 Guide for First-Time and Repeat Buyers

Down payment assistance (DPA) programs exist specifically to close the gap between what you’ve saved and what you need to buy a home. In Texas, state and local programs provide grants, forgivable loans, and low-interest second liens that can cover your entire down payment and part of your closing costs.

Most Texas buyers don’t know these programs exist. Those who do often assume they won’t qualify. The reality is that income limits are higher than you’d expect, and many programs serve repeat buyers — not just first-timers.

How down payment assistance works in Texas

DPA programs in Texas fall into three categories:

Grants. Free money that never has to be repaid. The Homeownership Across Texas (HAT) program and several city-level programs offer grants ranging from 1% to 5% of the loan amount.

Forgivable second liens. A second mortgage that’s forgiven after you live in the home for a set period (typically 3–5 years). If you sell or refinance before the forgiveness period ends, you repay the balance.

Deferred second liens. A second mortgage with no monthly payments. The balance is due when you sell, refinance, or pay off the first mortgage. These effectively reduce your upfront costs without adding to your monthly payment.

Most programs can be combined with FHA, VA, USDA, or conventional loans. Some require you to use a specific loan product or work with an approved lender.

Statewide programs

TSAHC — My First Texas Home

The Texas State Affordable Housing Corporation (TSAHC) runs the largest DPA programs in the state.

My First Texas Home provides:

• Down payment assistance of up to 5% of the loan amount
• Available as a grant (no repayment) or a deferred forgivable second lien
• Can be paired with FHA, VA, or USDA first liens
• 30-year fixed-rate first mortgage at competitive rates

Eligibility:

Requirement	Details
Credit score	620 minimum
Income limit	Varies by county and household size (typically 80% AMI)
Purchase price cap	Varies by county (check TSAHC limits)
Buyer status	First-time buyers or those who haven’t owned in 3+ years
Occupancy	Primary residence only

TSAHC — My Choice Texas Home

My Choice Texas Home extends similar benefits to repeat buyers and those who don’t meet the first-time buyer definition.

• Down payment assistance up to 5% of the loan amount
• Available as a grant or deferred forgivable second lien
• No first-time buyer requirement
• Same credit score and income limits as My First Texas Home

This is the program most repeat buyers miss. If you currently own a home and are buying your next one, you may still qualify.

Homeownership Across Texas (HAT) Program

The HAT Program provides grants ranging from 1% to 5% of the mortgage loan amount. These grants can be applied toward down payment or closing costs and never have to be repaid.

Key details:

• Minimum 620 credit score
• Income limits apply (vary by county)
• Available for purchase transactions only
• Works with FHA, VA, USDA, and conventional loans
• No first-time buyer requirement

Texas Mortgage Credit Certificate (MCC)

The MCC program isn’t a DPA program, but it stacks well with one. An MCC gives you a federal tax credit equal to a percentage of the mortgage interest you pay each year — typically 15% to 25% of your annual interest.

On a $300,000 loan at 6.5%, that’s roughly $2,900 to $4,875 per year in tax credits. Unlike a deduction, a credit reduces your tax bill dollar-for-dollar. The MCC lasts for the life of the loan and can be combined with TSAHC DPA programs.

City and county programs

Texas cities and counties run their own DPA programs with separate funding and eligibility rules. Here are the largest:

Fort Worth — Homebuyer Assistance Program (HAP)

The Fort Worth HAP offers up to $25,000 in assistance for down payment and closing costs.

• Household income must be at or below 80% of HUD area median income
• Must purchase within Fort Worth city limits
• Assistance provided as a forgivable loan
• Requires homebuyer education course

Dallas — Down Payment and Home Assistance Program (DHAP)

The Dallas DHAP provides assistance based on need for buyers within Dallas city limits.

• Income at or below 60% AMI minimum threshold
• Must be a primary residence purchase
• Requires completion of HUD-approved homebuyer education
• Assistance amount varies based on individual need

Austin — Down Payment Assistance

Austin’s DPA programs have provided up to $40,000 in assistance for qualifying buyers. Program availability and funding levels change annually, so check current availability with your lender.

Houston and Harris County

Harris County offers DPA through several channels, including the Harris County Community Services Department and various nonprofit partners. Programs typically provide $10,000–$25,000 in assistance for buyers meeting income requirements.

San Antonio

The City of San Antonio runs a homebuyer incentive program through its Neighborhood and Housing Services Department that provides DPA for qualifying buyers within city limits.

Who qualifies: common requirements across programs

While specific requirements vary by program, most Texas DPA programs share these baseline criteria:

Credit score: 620 minimum for most programs. Some city programs may accept lower scores, but 620 opens the most doors. If you’re below 620, see our guide on what to know before buying your first home for credit improvement strategies.

Income limits: Most programs cap household income at 80% of the area median income (AMI). In practice, this covers a large share of Texas buyers. For a family of four in the Dallas-Fort Worth metro, 80% AMI is approximately $82,000–$90,000 depending on the county.

Purchase price limits: Programs set maximum purchase prices that vary by county. These limits are generally high enough to cover median-priced homes in most Texas markets.

Occupancy: You must live in the home as your primary residence. Investment properties and second homes don’t qualify.

Homebuyer education: Most programs require completion of a HUD-approved homebuyer education course. These are available online and typically take 4–8 hours.

How to stack DPA with the best mortgage rate

DPA covers your upfront costs. Your mortgage rate determines your monthly payment for the next 15–30 years. Optimizing both is how you minimize total cost.

Here’s the problem: many DPA programs require you to use a specific lender or loan product, which can limit your rate options. The workaround is to compare the total cost of a DPA-paired loan against a non-DPA loan with a potentially better rate.

Example comparison on a $350,000 home:

Scenario	Down payment	DPA	Loan amount	Rate	Monthly P&I	Total cost (30 yr)
3.5% down FHA + 5% DPA	$12,250	$0 OOP	$337,750	6.25%	$2,079	$748,440
5% down conventional, no DPA	$17,500	—	$332,500	5.75%	$1,941	$698,760

In this example, the non-DPA option with a 0.5% better rate saves $49,680 over the loan’s life — but requires $17,500 more upfront. The right choice depends on your cash reserves and how long you plan to stay.

Chestnut compares rates from 100+ lenders in under two minutes, including lenders that participate in DPA programs. This lets you see the real tradeoff between DPA-paired rates and open-market rates side by side. Get a personalized quote to see your options.

Step-by-step: how to apply for Texas DPA

1. Check your credit score. Most programs require 620+. If you’re close, a rapid rescore through your lender can reflect recent paydowns in 2–5 business days. See our pre-approval guide for details.

2. Determine your income eligibility. Use TSAHC’s online lookup tool to check income limits for your county and household size.

3. Complete homebuyer education. Most programs require this before closing. Do it early so it doesn’t delay your timeline. HUD-approved online courses are available at eHome America and other providers.

4. Get pre-approved with a participating lender. DPA programs maintain lists of approved lenders. Make sure your lender participates in the program you want.

5. Compare your DPA-paired rate against open-market rates. Use Chestnut to see what rate you’d get without DPA, then compare total costs.

6. Apply for DPA alongside your mortgage. Your lender handles most of the DPA paperwork. The DPA approval runs parallel to your mortgage approval.

7. Close on your home. DPA funds are disbursed at closing and applied directly to your down payment and/or closing costs.

Common mistakes to avoid

Assuming you don’t qualify. Income limits are higher than most people expect. Check before you rule yourself out.

Ignoring the rate tradeoff. DPA saves you money upfront but may pair you with a slightly higher rate. Always compare total cost, not just upfront cost.

Waiting too long. Many DPA programs have limited annual funding. Once the money’s gone, the program closes until the next funding cycle. Apply early in the fiscal year when funding is fresh.

Skipping homebuyer education. This is a hard requirement for most programs. Don’t leave it to the last minute.

Not checking city and county programs. Statewide programs get the most attention, but city-level programs like Fort Worth’s $25,000 HAP grant can be more generous. Check what’s available in your specific location.

Frequently asked questions

How much down payment assistance can I get in Texas?

Statewide programs like TSAHC and HAT typically provide 1–5% of the loan amount as a grant or forgivable loan. City programs can go higher — Fort Worth’s HAP offers up to $25,000. On a $350,000 home, 5% DPA equals $17,500, which can cover your entire down payment on an FHA loan.

Do I have to be a first-time buyer to get DPA in Texas?

No. TSAHC’s My Choice Texas Home program and the HAT grant program are both available to repeat buyers. Several city-level programs also serve repeat buyers. The first-time buyer requirement is less common than most people assume.

Can I combine DPA with an FHA or VA loan?

Yes. Most Texas DPA programs work with FHA, VA, USDA, and conventional loans. TSAHC programs specifically pair with FHA, VA, and USDA first liens. Check the specific program requirements for loan type compatibility.

What credit score do I need for Texas DPA programs?

Most programs require a minimum 620 FICO score. Some city programs may have different thresholds. A higher score (680+) gives you access to better rates on the underlying mortgage, which can offset or exceed the value of the DPA itself.

Do I have to repay down payment assistance in Texas?

It depends on the program type. Grants (like the HAT program) never require repayment. Forgivable second liens are forgiven after a set period (typically 3–5 years) if you stay in the home. Deferred second liens are repaid when you sell, refinance, or pay off the first mortgage.

Can I use DPA for closing costs too?

Yes. Most Texas DPA programs allow funds to be applied toward both down payment and closing costs. This is particularly valuable since closing costs in Texas typically run 2–5% of the purchase price.

Your next step

See what rate you qualify for and whether DPA makes sense for your situation. Get a personalized quote from Chestnut in under two minutes — you’ll see rates from 100+ lenders for your specific profile, with no commitment and no impact on your credit score.

Sources

1. https://www.tsahc.org/homebuyers-renters/my-first-texas-home
2. https://www.tsahc.org/homebuyers-renters/my-choice-texas-home
3. https://www.hatgrant.com/hat-program
4. https://www.tsahc.org/homebuyers-renters/mortgage-credit-certificate
5. https://www.fortworthtexas.gov/departments/neighborhoods/housing-assistance-program
6. https://dallascityhall.com/departments/housing-neighborhood-revitalization/Pages/Mortgage-assistanceLoan-registration.aspx
7. /news/what-to-know-before-buying-your-first-home
8. /news/5-steps-to-get-preapproved-for-a-mortgage-fast
9. /news/closing-costs-explained