Texas First-Time Homebuyer Programs: Your Complete 2025 Guide
Buying your first home in Texas? You’re in luck. The Lone Star State offers some of the most generous first-time homebuyer assistance programs in the country. From down payment grants that don’t need to be repaid to below-market interest rates, there’s help available whether you’re buying in Houston, Dallas, Austin, San Antonio, or anywhere in between.
In this comprehensive guide, I’ll walk you through every major program available to Texas first-time homebuyers in 2025, including income limits, eligibility requirements, and how to apply. As a mortgage broker who’s helped hundreds of first-time buyers, I’ll also share insider tips on which programs work best for different situations.
💡 Quick Definition: Who’s a “First-Time Homebuyer”?
In Texas, you’re considered a first-time homebuyer if you haven’t owned a home in the past three years. This means even if you owned a home 5 years ago, you may still qualify for these programs!
Texas State Housing Programs (TDHCA)
The Texas Department of Housing and Community Affairs (TDHCA) is the primary source for statewide first-time homebuyer programs. These programs are available regardless of which Texas city or county you’re buying in. For more details on starting your home purchase journey, visit our Purchase a Home page.
🏠 My First Texas Home Program
The flagship program for Texas first-time buyers, offering competitive 30-year fixed-rate mortgages with down payment assistance.
- Down Payment Assistance: Up to 5% of the loan amount
- Loan Types: FHA, VA, USDA, or Conventional
- Interest Rate: Typically 0.25-0.50% below market rates
- Repayment: Deferred second lien, due when you sell, refinance, or pay off the mortgage
- Income Limit: Varies by county (typically $98,000-$125,000 for a family of 3+)
💰 Texas Mortgage Credit Certificate (MCC)
A federal tax credit that puts money back in your pocket every year you own your home. This isn’t a loan—it’s an ongoing tax benefit.
- Tax Credit: Up to 20% of your annual mortgage interest
- Maximum Credit: $2,000 per year
- Duration: As long as you live in the home and pay mortgage interest
- Can Be Combined: Use alongside My First Texas Home or other programs
- One-Time Fee: Approximately $500-700 at closing
🎯 Pro Tip: Stack Your Benefits
You can often combine programs! For example, use My First Texas Home for down payment assistance AND get the Mortgage Credit Certificate for ongoing tax savings. Over a 10-year period, this combination could save you $25,000+.
Down Payment Assistance Options in Texas
Down payment is the biggest hurdle for most first-time buyers. Here’s the good news: Texas has multiple programs that can help cover some or all of your down payment and closing costs. Learn more on our Down Payment Assistance page.
Grant Programs (Free Money!)
These programs provide funds that don’t need to be repaid—essentially free money toward your home purchase:
- TDHCA DPA Grant: Up to 5% of the loan amount, never needs to be repaid
- City of Houston Homebuyer Assistance: Up to $40,000 for income-qualifying buyers
- Dallas Homebuyer Assistance Program: Up to $50,000 in some neighborhoods
- San Antonio Down Payment Assistance: Various programs up to $30,000
- Austin’s Down Payment Assistance: Up to $40,000 depending on income
Forgivable Second Liens
These are loans that are forgiven over time if you stay in the home:
- SETH 5 Star Program: 5% assistance, forgiven after 3 years
- TSAHC Homes for Texas Heroes: 3-5% assistance for teachers, first responders, veterans, and healthcare workers
- TDHCA HOME Program: Income-based assistance, often forgivable after 5-10 years
| Program | Assistance Amount | Repayment | Best For |
|---|---|---|---|
| TDHCA Grant | Up to 5% | None (Grant) | All first-time buyers |
| MCC Tax Credit | $2,000/year | None (Tax Credit) | Higher income buyers |
| SETH 5 Star | 5% | Forgiven in 3 years | Planning to stay 3+ years |
| Homes for Heroes | 3-5% | Forgivable | Teachers, nurses, police, vets |
| City Programs | $20K-$50K | Varies | Lower income buyers |
Not Sure Which Program You Qualify For?
We’ll review your situation and match you with the best Texas assistance programs—no credit check required to get started.
LET’S TALKIncome Limits & Eligibility Requirements
Most Texas first-time homebuyer programs have income limits that vary by county and household size. Here’s what you need to know:
📋 General Eligibility Requirements
- Haven’t owned a home in the past 3 years
- Meet program-specific income limits
- Minimum credit score (usually 620-660)
- Must occupy the home as your primary residence
- Complete a homebuyer education course
- Purchase price within program limits
2025 Income Limits by Major Texas Metro
These are approximate limits and can change. Always verify current limits with your lender:
| Metro Area | 1-2 Person Household | 3+ Person Household |
|---|---|---|
| Houston | $97,300 | $111,900 |
| Dallas-Fort Worth | $103,500 | $119,000 |
| Austin | $112,700 | $129,600 |
| San Antonio | $87,400 | $100,500 |
| Rural Texas | $75,000-$85,000 | $86,000-$98,000 |
Special Programs for Texas Heroes
If you’re a teacher, first responder, veteran, or healthcare worker, you have access to additional programs with enhanced benefits:
🎖️ TSAHC Homes for Texas Heroes
Designed specifically for those who serve our communities. Available to:
- Teachers and school employees
- Police officers and corrections officers
- Firefighters and EMS personnel
- Veterans and active military
- Nurses and healthcare workers
Benefits: Below-market interest rates + up to 5% down payment assistance
Veterans have additional options through VA loans, which can be combined with Texas state programs. A VA loan offers zero down payment and no mortgage insurance, making it one of the best mortgage options available. Learn more about Texas VA loans here.
Are You a Veteran or Active Military?
Combine your VA benefits with Texas assistance programs for maximum savings. Let’s explore your options together.
LET’S TALKHow to Apply: Step-by-Step Process
Ready to take advantage of these programs? Here’s how to get started:
- Check Your Credit: Most programs require a minimum 620-660 credit score. If you’re below that, we can help you create a plan to improve it.
- Calculate Your Income: Add up your household’s gross annual income to see which programs you qualify for.
- Complete Homebuyer Education: Most programs require an approved course. Online options are available for around $100 and take 4-8 hours.
- Find a Participating Lender: Not all lenders offer these programs. As a participating lender with TDHCA, TSAHC, and local programs, we can guide you through your options.
- Get Pre-Approved: We’ll review your finances and determine which programs best fit your situation.
- Find Your Home: Work with a real estate agent to find a home within the program’s purchase price limits.
- Close on Your New Home: The assistance funds are applied at closing to cover your down payment and/or closing costs.
Use our Mortgage Calculator to estimate your monthly payments with different down payment scenarios. You can also download our free Homebuyer Guide for a complete walkthrough of the process.
⚠️ Important: Work with an Experienced Lender
These programs have specific requirements and paperwork. Working with a lender experienced in Texas first-time buyer programs ensures you don’t miss out on benefits you qualify for—or run into issues that delay your closing.
Common Questions from Texas First-Time Buyers
Can I use these programs with any type of loan?
Most Texas programs work with FHA, VA, USDA, and Conventional loans. Some are restricted to certain loan types, so we’ll match you with the best combination.
Do I have to be a Texas resident?
You don’t need to currently live in Texas, but you must intend to make the purchased home your primary residence.
Can I buy a condo or townhome?
Yes! Single-family homes, townhomes, and approved condos are all eligible. Manufactured homes on permanent foundations may also qualify.
What if I make too much money for state programs?
If you exceed income limits, you may still qualify for conventional loans with as little as 3% down, or FHA loans at 3.5% down. Some employer-based programs and mortgage credit certificates have higher income limits.
How long does the process take?
From application to closing, expect 30-45 days. Program-specific paperwork can add a few days, so starting early is always smart.
The Bottom Line
Buying your first home in Texas doesn’t have to mean draining your savings. Between state programs, local assistance, and federal tax credits, there’s likely a combination that can help you achieve homeownership sooner than you think.
The key is working with a lender who knows these programs inside and out. Every buyer’s situation is different, and the “best” program depends on your income, credit score, career, and where you’re buying.
As a mortgage broker, I’m not locked into one lender’s products. I can shop multiple lenders and programs to find the combination that saves you the most money—both at closing and over the life of your loan.
Ready to explore your options? Visit our First-Time Homebuyers page or contact us to get started.
Ready to Explore Your Options?
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