Up to 5% Toward Your Texas Down Payment

A Texas buyer with steady income and no savings is the most common file we see that does not have to end in a no. The Texas State Affordable Housing Corporation exists for exactly that buyer, and it is consistently underused — mostly because people assume it is only for first-time buyers, and it is not.

What TSAHC actually provides

Up to 5% of your loan amount toward your down payment, your closing costs, or both.

On a $300,000 loan that is $15,000 you did not have to save. Paired with FHA financing, where the required down payment is 3.5% and can be a gift or assistance, that is frequently the entire cash requirement covered.

TSAHC runs two programs, and they differ only in who they are for:

Home Sweet Texas Home Loan Program — for Texas buyers with low and moderate incomes. Not tied to any profession.

Homes for Texas Heroes — for people in specific occupations. TSAHC's list covers professional educators including teachers, aides, librarians, counselors and school nurses; police officers and public security officers; firefighters and EMS personnel; veterans and active military; corrections and juvenile corrections officers; and nursing and allied health faculty.

If you fall into a Heroes category, that is the program to look at. If you do not, Home Sweet Texas is still there.

The part most articles skip: which kind of assistance you take

This is the section that matters, and it is the one you will not find in most write-ups of this program. TSAHC gives you a choice of three structures, and they are genuinely different:

A grant. Never repaid. Gone from your obligations at closing.

A deferred forgivable second lien. Forgiven after three years, provided you are still in the home. No monthly payment in the meantime.

A deferred repayable second lien. Repaid when you sell, transfer, pay off, or refinance the first mortgage. No monthly payment, but it is a real debt sitting against the property.

Nobody gives you the best version of all three at once. The trade is in the pricing of the first mortgage — the structures that cost you less later generally come with a first mortgage that costs more, and vice versa. Which one wins depends on something only you know: how long you are actually going to keep this house.

If you are buying a house you expect to be in for fifteen years, a forgivable second that disappears in year three is close to free money. If you might be relocated in two years, the same choice is a debt that comes due at the worst possible moment, and a grant — even with a higher first-mortgage cost — may be the better answer.

Ask for all three side by side before you choose. If a lender presents you with only one, ask why.

Who qualifies

You do not have to be a first-time buyer. This is the single biggest misconception about TSAHC, and it turns away people who would qualify. Some program options and targeted areas have their own requirements, but prior homeownership is not a blanket disqualifier.

Credit score minimums are 620 on government loans and 640 on conventional. Achievable scores, and below what a lot of buyers assume assistance programs require.

Income limits are based on the area median income and your household size, and they run higher than people expect — TSAHC's programs reach well into moderate-income territory, not just low-income. Purchase price limits also vary by county and household size.

We have deliberately not printed the limits here. They move, they differ by county, and a number that is six months stale on a lender's website is how a qualified buyer decides not to bother. Tell us your county and household size and we will check the current figure against your actual income while you wait.

The mistake that costs people the assistance

You have to set this up before you have a contract, not after.

TSAHC assistance is arranged through the loan, with an approved lender, and the paperwork has to be in place from the start. We see buyers who found out about the program after they were already under contract with a lender who does not participate, and at that point the options are bad ones — restart the financing and risk the contract, or give up the assistance.

If you think you might qualify, the call is worth making before you write an offer. Even before you start looking.

What we can tell you plainly

National One Mortgage Corp is an approved lender with TSAHC, so we can originate these loans and put the assistance structures in front of you.

We do not offer TDHCA's programs, so we are not going to describe them here as though we could put you into one.

And if TSAHC turns out not to fit — the income limit, the property, the timing — that is not the end of the conversation. It usually means a different route to the same outcome, and there are several:

• FHA at 3.5% down, where the entire down payment can be a gift from family, an employer, or a union. No assistance program required.
• A VA loan at zero down if you or your spouse served. No down payment, no monthly mortgage insurance.
• USDA at zero down if the property is in an eligible area — and "rural" covers far more of Texas than the name suggests.
• Conventional at 3% down for a first-time buyer, where the mortgage insurance cancels once you reach 20% equity.

Tell us the situation and we will tell you which of these actually works for you, including when the answer is that waiting six months puts you in a better position. We would rather have that conversation than watch you assume there was nothing here.

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FAQ

How much down payment assistance can I get in Texas through TSAHC? Up to 5% of your loan amount, usable for down payment, closing costs, or both.

Do I have to be a first-time home buyer to use TSAHC? No. Prior homeownership does not automatically disqualify you, though some program options and targeted areas carry their own requirements.

Is TSAHC down payment assistance a grant or a loan? It can be either — you choose. TSAHC offers a grant that is never repaid, a deferred second lien forgiven after three years if you stay in the home, or a deferred second lien repayable on sale, transfer, payoff, or refinance. The first mortgage pricing differs between them, so the right choice depends on how long you plan to keep the home.

What credit score do I need for TSAHC? 620 on government loans and 640 on conventional, per TSAHC. Individual lender overlays may be higher.

Who counts as a Texas Hero? Professional educators including teachers, aides, librarians, counselors and school nurses; police and public security officers; firefighters and EMS personnel; veterans and active military; corrections and juvenile corrections officers; and nursing and allied health faculty.

Can I use TSAHC assistance with an FHA loan? Yes, and it is a common pairing — FHA's 3.5% down requirement can be covered by assistance, which for many buyers covers the cash needed to close.

Are there income limits for TSAHC? Yes, based on area median income and household size, and they vary by county. They extend into moderate-income ranges rather than being limited to low-income households. Ask us to check the current limit for your county.