First-Time Home Buyer Texas 2026:
Grants, Down Payment Assistance & Programs
Texas first-time home buyers in 2026 have access to up to 5% in down payment assistance — a non-repayable grant through TSAHC or a deferred loan through TDHCA, plus local Tarrant County grants up to $50,000. To access them: no primary-residence ownership in the past 3 years, credit score 620 or above, and household income at or below 80% of Area Median Income for your county. Veterans qualify regardless of prior ownership. Buyers above 80% AMI have a separate path through SETH. Start your South DFW home search.
Not sure which down payment assistance program fits your situation?
Book a free consultation with SilviaHow to Buy Your First Home in Texas: 5 Practical Steps
- 1 Pull your credit report — get a free report at AnnualCreditReport.com. Most DPA programs require 620+. Budget 3–6 months to repair if below that threshold before applying.
- 2 Check your income against AMI limits — use HUD's income limit tables to confirm you're at or below 80% AMI for your county. If above 80%, check SETH at sethfc.com before assuming you don't qualify for assistance.
- 3 Select your program — TDHCA My First Texas Home, TSAHC Home Sweet Texas, SETH 5 Star, or a local DFW grant based on your address and profession. Location and income determine which programs apply; the table below shows options side by side.
- 4 Complete HUD-approved homebuyer education — required by every state DPA program. The course takes 6–8 hours online; your TDHCA Homebuyer Education Certificate is issued on completion. Housing Channel (housingchannel.org) and NeighborWorks America member agencies serve DFW buyers. Find any HUD-9902 agency at consumerfinance.gov/find-a-housing-counselor or the HUD counselor locator.
- 5 Get pre-qualified through a participating lender — not all lenders offer TDHCA, TSAHC, or SETH loans. Once pre-approved, your lender must deliver a Loan Estimate within 3 business days — review it line by line before locking your rate. Budget 45–60 days to close when using DPA. The CFPB's Loan Estimate explainer breaks down every line item.
First-Time Home Buyer Grants in Texas at a Glance (2026)
| Program | Max Assistance | Credit Min | Best For |
|---|---|---|---|
| TDHCA My First Texas Home | 5% of loan (deferred) | 640 | Buyers who want to stack MCC; county income limits apply |
| TDHCA My Choice Texas Home | 5% of loan (deferred) | 640 | Repeat buyers; no 3-year look-back required |
| TSAHC Home Sweet Texas | 5% grant (non-repayable) | 620 | Buyers wanting a true grant; 80% AMI limit |
| TSAHC Homes for Texas Heroes | 5% grant (non-repayable) | 620 | Teachers, police, fire, EMS, corrections officers, veterans |
| SETH 5 Star / GoldStar | 5% (5 Star) / up to 7% (GoldStar) | 620–640 | Buyers above 80% AMI; higher income limits on select tiers — verify at sethfc.com |
| Tarrant County HOME | $50,000 | 620 | Buyers outside Fort Worth/Arlington city limits; largest local grant |
| Fort Worth HAP | $25,000 | 620 | First-time buyers within Fort Worth city limits |
| Arlington AHAP | $20,000 | 620 | First-time buyers within Arlington city limits |
Which program fits? For buyers at or below 80% AMI in South DFW: TSAHC Home Sweet Texas (620 credit, true grant, nothing to repay) or TDHCA My First Texas Home (640 credit, stackable with MCC for long-term tax savings). Buyers above 80% AMI should check SETH 5 Star or GoldStar — Southeast Texas Housing Finance Corporation programs that serve a wider income band than TDHCA or TSAHC. Tarrant County buyers outside Fort Worth and Arlington city limits should always check the $50,000 HOME program first. Address determines local eligibility; credit score and income determine which state program fits.
Texas First-Time Home Buyer Requirements for 2026
Meet the 3-year rule (no primary-residence ownership in the past 3 years), score 620–640 or above on credit, earn at or below 80% AMI for your county (or check SETH if above that threshold), complete a HUD-approved homebuyer education course, and plan to occupy the home as your primary residence. Veterans and targeted-area buyers qualify under relaxed rules — most programs waive the 3-year look-back entirely for veteran borrowers.
The 3-Year Rule: What Counts as a First-Time Home Buyer in Texas?
Texas defines a first-time home buyer the same way the IRS does: under §143 of the Internal Revenue Code, you qualify if you have not owned a home as your primary residence in the past 3 years. Prior ownership before that window is fine. Texas programs — TDHCA, TSAHC, SETH, and local city grants — apply this §143 look-back uniformly, which is why the same three-year window appears across all 2026 first-time home buyer incentives statewide.
- You're a veteran — most programs waive the look-back for veterans and active-duty service members
- You're buying in a federally designated targeted census tract — expanded eligibility applies in certain areas regardless of prior ownership
- You sold or lost a home before 2023 and have rented since — you're back in the window
Example: if you owned a condo in 2020 and have rented since early 2022, you qualify for 2026 programs because the 3-year look-back clears in 2025.
Loan Types That Pair With Texas First-Time Buyer Grants in 2026
| Loan Type | Down Payment | Credit Score | Best For |
|---|---|---|---|
| FHA 203(b) | 3.5% | 580+ | Lower credit scores, smaller down payment |
| Conventional | 3–5% | 680+ | Higher credit scores, drop PMI faster |
| Fannie Mae HomeReady | 3% | 620+ | Income at or below 80% AMI; reduced PMI rates |
| Freddie Mac Home Possible | 3% | 620+ | Low-to-moderate income; income-based PMI discount |
| VA (0% down) | 0% | 620+ | Veterans, active military, eligible spouses |
| USDA Rural Development (0% down) | 0% | 640+ | Rural and suburban areas — parts of Ellis and Johnson Counties qualify |
Closing costs still apply, but seller concessions or lender credits can offset them. Fannie Mae HomeReady and Freddie Mac Home Possible are conventional 3%-down options with income-based PMI discounts — both pair well with the Mortgage Credit Certificate (MCC) and are worth comparing to FHA 203(b) if your score is above 680. Most DPA programs layer on top of FHA 203(b), so pick your loan type first, then layer the grant on top. Check the USDA Eligibility Map to confirm whether a specific Ellis or Johnson County address qualifies.
2026 Loan Limits (DFW Area)
- FHA 203(b) limit: $541,287–$563,500 (varies by county — HUD source)
- Conforming limit (FHFA): $832,750 — set annually by the Federal Housing Finance Agency
- VA limit: No cap for borrowers with full entitlement
Down Payment Assistance Grants in Texas: TDHCA, TSAHC & SETH Programs (2026)
Texas has three main program administrators for 2026 first-time home buyer grants and down payment assistance. TDHCA and TSAHC serve buyers at or below 80% AMI through Mortgage Revenue Bonds (MRBs) — a state-issued bond mechanism that lets them offer participating-lender mortgages at rates tied to bond market conditions. SETH (Southeast Texas Housing Finance Corporation) serves a broader income band and covers the entire state including DFW. Because the assistance is built into the bond structure, DPA-paired rates run slightly above market — check each agency's rate board daily through their participating lenders.
TDHCA My First Texas Home
Up to 5% DPA- 30-year fixed-rate mortgage through participating lenders, funded via TDHCA Mortgage Revenue Bonds
- Down payment assistance up to 5% of loan amount — deferred at 0% interest for 30 years, or forgivable after 3 years
- Minimum credit score: 640 (FHA/VA/USDA) or 680 (conventional 95%+ LTV)
- Income limits vary by county and household size — check TDHCA's income table; program details at welcomehome.tdhca.texas.gov/programs
- Must complete a HUD-approved homebuyer education course and obtain the TDHCA Homebuyer Education Certificate — lenders request this by name at underwriting
- Stackable with Mortgage Credit Certificate (MCC) for an additional annual federal tax credit
Example on a $400,000 purchase: FHA 3.5% down ($14,000) with TDHCA's 5% DPA ($20,000 on a $386,000 loan) — the grant covers the full down payment and part of closing costs. Cash needed at closing drops to roughly $6,000 depending on negotiated seller concessions.
Not a first-time buyer? TDHCA's My Choice Texas Home offers the same 5% DPA structure with no 3-year look-back requirement — open to repeat buyers. Details at welcomehome.tdhca.texas.gov/programs.
TSAHC Home Sweet Texas Home Loan
Up to 5% Grant- Down payment and closing cost assistance as a non-repayable grant — no second mortgage, nothing to pay back
- 30-year fixed-rate mortgage, also funded through the Mortgage Revenue Bond mechanism
- Minimum credit score: 620
- Household income at or below 80% of Area Median Family Income (check HUD AMI limits)
- Must complete homebuyer education and obtain the TDHCA Homebuyer Education Certificate or equivalent HUD-approved certificate
- Stackable with Mortgage Credit Certificate (MCC)
Apply through: tsahc.org
TSAHC Homes for Texas Heroes
Up to 5% Grant- Same non-repayable grant structure as Home Sweet Texas
- Available to: teachers, police officers, firefighters, EMS personnel, corrections officers, veterans
- Veterans may qualify regardless of prior homeownership
- Slightly higher income limits in some counties
Apply through: TSAHC Homes for Texas Heroes page
SETH 5 Star & GoldStar (Southeast Texas Housing Finance Corporation)
Up to 7% (tier-dependent)- Statewide program — covers DFW, not just Southeast Texas despite the name
- 5 Star Texas Advantage: down payment and closing cost assistance as a grant, up to 5% of the loan amount
- GoldStar: up to 7% DPA as a 3-, 7-, or 10-year forgivable second mortgage — the higher cap of the two tiers
- Income limits are higher than TDHCA or TSAHC on select tiers — SETH is the primary option for buyers who earn too much for other state programs
- Minimum credit score varies by tier: typically 620–640 depending on loan type
- Loan types accepted: FHA, VA, USDA, conventional
- Must use a SETH-approved participating lender — find one at sethfc.com
Verify current income limits and tier structures directly with SETH — tier eligibility and AMI caps vary by program year and are updated annually. This is the program to check if TDHCA and TSAHC declined you on income.
How to Apply for Texas First-Time Home Buyer Grants (TSAHC & TDHCA)
TSAHC and TDHCA grants are not applied for directly — access them through an approved participating lender. Find a lender at tsahc.org or tdhca.texas.gov, get pre-approved, complete a HUD-approved homebuyer education course and obtain your TDHCA Homebuyer Education Certificate, then close through that lender. Grant funds are applied at closing; there is no separate application portal.
How Long Does the First-Time Home Buyer Class Take in Texas?
Most HUD-approved homebuyer education courses take 6–8 hours online. Complete the course at your own pace and receive your certificate the same day you finish. Budget time for this before making an offer — lenders require the certificate before reserving DPA funds.
The step-by-step application process:
- 1 Find a participating lender — use the TSAHC lender directory. An unapproved lender disqualifies you from the grant.
- 2 Get pre-approved — your lender verifies income, credit (620+ required), and AMI eligibility before reserving grant funds on your behalf.
- 3 Complete HUD-approved homebuyer education — required by every state DPA program. Courses typically run 6–8 hours online. Two statewide HUD-9902 Housing Counseling Program agencies that serve Texas buyers: Housing Channel (housingchannel.org), which operates in DFW and offers both online and in-person courses, and NeighborWorks America, a national network with member organizations across Texas searchable through the CFPB locator. Find any HUD-approved agency at consumerfinance.gov/find-a-housing-counselor or the HUD counselor locator. Your TDHCA Homebuyer Education Certificate is issued upon completion — keep a copy for your lender.
- 4 Make an offer and open title — your lender coordinates with TSAHC or TDHCA to confirm fund reservation once a contract is signed.
- 5 Close — grant funds are applied at the closing table. Budget 45–60 days from contract to close when using DPA; the added compliance review extends beyond a conventional closing timeline. Alert the seller's agent early so the timeline is built into the contract.
Texas Veteran Home Buyer Programs: VLB, VA, and TSAHC Heroes
- Texas Veterans Land Board (VLB) Home Loan Program — the VLB Home Loans program is a Texas state agency (not federal) offering below-market fixed rates exclusively to Texas veterans and active-duty service members. On a 30-year loan at current rates, even a 0.25% rate reduction saves roughly $15,000 in interest over the life of the loan. Apply or check current rates at glo.texas.gov/veterans/home-loans.
- Federal VA Loan (0% down) — no down payment, no PMI, no loan limit for borrowers with full entitlement. Minimum credit score 620+ through most participating lenders. Closing costs apply but can be covered by seller concessions.
- TSAHC Homes for Texas Heroes — the 5% non-repayable grant available to veterans. Veterans may qualify regardless of prior homeownership, making this the strongest DPA option for veterans who don't qualify for VA.
Veterans can stack the VLB rate benefit with the TSAHC Heroes grant in certain configurations. Confirm with a lender who handles both programs.
DFW Down Payment Grants: Tarrant County, Fort Worth & Arlington (2026)
Your specific address determines eligibility. City-limit boundaries matter.
South DFW property tax note: Buyers here are assessed by TAD (Tarrant), DCAD (Dallas), Ellis CAD, or Johnson CAD depending on the county. Under §25.19 of the Texas Tax Code, your CAD must send you an annual notice of appraised value — worth reviewing each spring before the protest deadline. Full homestead exemption details are in the Texas property tax guide.
Tarrant County Homebuyer Assistance
Up to $50,000- Zero-interest deferred loan, forgivable after 10–20 years
- Home must be outside Fort Worth, Arlington, and Grand Prairie city limits
- Household income at or below 80% AMI
- Liquid assets under $25,000
- Invest at least $1,500 of your own funds
- Two months of mortgage payments in reserve
- Complete a HUD-certified homebuyer workshop through the Housing Channel (housingchannel.org)
Works for: Mansfield, areas just outside Arlington city limits, and unincorporated Tarrant County. See our Mansfield buyer guide, Midlothian buyer guide, and Waxahachie buyer guide for nearby Ellis County options.
Applying for the $25,000 Fort Worth First-Time Home Buyer Grant
Up to $25,000- For first-time buyers within Fort Worth city limits
- Income limits based on HUD guidelines by household size
- Must occupy as primary residence
Note (Last verified: January 2026): The Fort Worth HAP depletes mid-year and reopens when HUD HOME funds are reallocated — confirm fund availability before entering contract. Contact the City of Fort Worth Neighborhood Services Division at fortworthtexas.gov/neighborhoods/services/hap or call 817-392-7540.
Arlington Homebuyer Assistance Program (AHAP)
Up to $20,000- For qualified first-time buyers in Arlington city limits — contact Arlington Community Development to confirm current program URL and fund availability
- Household income cannot exceed 80% AMI (family of 4: ~$82,000–$94,000 depending on county; check current HUD limits)
Texas HAF (Homeowner Assistance Fund) — closed to new applicants: Texas received federal HAF funding to help homeowners behind on mortgage payments. Since October 2023, the Texas HAF program has stopped accepting new applications — all allocated funds were committed. If you see references to HAF as a 2026 option, they are outdated. The programs listed on this page are the active 2026 paths for new buyers.
What Is the Income Limit for a First-Time Home Buyer in Texas?
The table below shows the 2026 limits for a family of 4 in the DFW-area counties where this article's programs apply. Exact figures for other household sizes are at HUD's income limit tables.
| County | 80% AMI Limit (Family of 4, 2026) |
|---|---|
| Tarrant County | ~$82,800 |
| Dallas County | ~$87,200 |
| Ellis County | ~$79,600 |
| Johnson County | ~$75,600 |
Income counts all adult earners in the household. Buyers above these thresholds should check SETH programs, which extend eligibility to 120% AMI on select tiers. All figures reset annually. Verify the current year at huduser.gov.
What Is the Monthly Mortgage Payment on a $250,000 or $300,000 Home in Texas?
On a $250,000 home in Texas at 7% with a 3.5% FHA down payment: approximately $2,210–$2,380/month total (PITI). The range reflects property tax variation across DFW counties. Breakdown:
- Principal and interest (on a $241,250 loan): ~$1,620/month
- Property taxes: ~$350–$480/month — varies by county and whether the homestead exemption applies (Texas's $100,000 homestead exemption, raised in 2023, meaningfully reduces taxable value; effective rates after exemption typically run 1.8–2.2% depending on the appraisal district)
- Homeowner's insurance: ~$120/month
- FHA mortgage insurance (MIP): ~$170/month
On a $300,000 home with the same inputs: approximately $2,630–$2,840/month total — principal and interest rises to ~$1,940/month, with taxes and insurance scaling proportionally. Check the Texas property tax guide for county-by-county effective rates and exemption detail.
Down Payment Math: Real 2026 Example for South DFW
South DFW first-time buyers in 2026 typically shop in the $320K–$420K range across Mansfield, Midlothian, and surrounding Tarrant County suburbs, based on NTREIS data and recent buyer transaction files.
Example: $475,000 Home — Tarrant County HOME + TSAHC (Stacked)
- Purchase Price
- $475,000
- Conventional Down Payment (5%)
- $23,750
- TSAHC Grant (5%)
- -$23,750
- Closing Costs (estimate 3%)
- $14,250
- Cash Needed at Closing
- $14,250
The $400,000 TDHCA scenario is covered inside the TDHCA program card above. Many programs allow DPA funds to cover closing costs as well. Seller concessions or a lender credit can further reduce cash at the table. New construction builders in South DFW frequently contribute both. See the Texas property tax guide for a full breakdown of ongoing ownership costs by county: Texas property tax guide.
Not sure which program fits? Silvia runs these numbers for buyers every week. No pressure, just answers.
Book a 15-Minute Eligibility CallHow Much Income Do You Need to Afford a $400,000 House in Texas?
That assumes 7% interest, 5% down, and a 28% front-end debt ratio. At those inputs, principal and interest runs ~$2,530/month; add taxes and insurance and total housing cost reaches $3,100–$3,300/month, which requires that income range to stay within standard lender limits.
Mortgage Credit Certificate (MCC) Texas: Annual Tax Credit That Stacks With DPA
The Mortgage Credit Certificate (MCC) Texas program converts a portion of your mortgage interest into a direct federal income tax credit every year you own the home. Unlike a grant or loan, the MCC generates a recurring annual benefit and stacks on top of TDHCA and TSAHC down payment assistance.
- Credit equals 40% of annual mortgage interest paid, up to $2,000/year (rates vary by program year and lender — confirm with TDHCA's current MCC program sheet)
- Carry unused credits forward 3 years
- Must meet first-time buyer requirements (3-year look-back, IRS §143 of the Internal Revenue Code)
- One-time fee at closing — the benefit lasts the life of the loan
Example: On a $400,000 loan at 7%, year-one interest is ~$28,000. At a 40% credit rate, that's $11,200 — capped at $2,000 annually. Over 10 years: up to $20,000 in federal tax savings, stacked on top of any DPA grant received at closing.
"DPA can be great, but it's rarely 'free' money, you're usually paying for it through a slightly higher rate or terms. If you can realistically save the 3.5% soon, you might end up with more flexibility and a better overall deal."
— u/Unlucky_Resident_759, r/FirstTimeHomeBuyer
"37F and 33M. $290k 6.375%. North Texas. FHA Loan with Down payment assistance. 0 down. $2,500 earnest money back at closing."
What Interest Rate Do Texas First-Time Home Buyer Programs Offer?
TDHCA and TSAHC loans carry a participating-lender rate set daily — typically at or slightly above market because the down payment assistance is built into the Mortgage Revenue Bond structure. As of early 2026, DPA-paired loans are running in the 6.5%–7.5% range depending on loan type and lender. Check TDHCA's live rate board for current numbers — published estimates go stale within weeks.
Can You Buy a House in Texas on $3,000 a Month?
At $3,000/month gross, the 28% housing ratio allows $840/month for principal, interest, taxes, and insurance — supporting a loan of roughly $110,000–$130,000 at current rates. A $3,000/month earner ($36K annually) falls well below the 80% AMI threshold for any DFW county, making programs like TSAHC Home Sweet Texas available for down payment assistance. The most realistic zero-down path at this income level is USDA Rural Development — parts of Ellis and Johnson Counties in South DFW qualify; use the USDA Eligibility Map to check a specific address. DPA reduces upfront cash but does not lower the monthly payment — a lower-priced home or co-borrower is also required to qualify at $3,000/month.
When Texas First-Time Buyer Programs Don't Apply
- Owned a home in the past 3 years. Exception: veterans and targeted-area buyers qualify under relaxed rules. TDHCA's My Choice Texas Home is the alternative for everyone else.
- Credit score below 580. FHA 203(b) requires 580 minimum. Most DPA programs require 620–640. No DPA program in Texas is available below 580.
- Self-employed less than 2 years. Buying is still possible, but lenders require 2 years of tax returns and documentation standards are stricter.
- Closing timeline under 45 days. DPA programs add processing time — 45–60 days is realistic. Don't commit to a fast-close contract with DPA involved.
- Household income above 80% AMI. Income limits run roughly $75,600–$87,200 for a family of 4, varying by county. Check SETH programs if above that threshold — they extend to 120% AMI on select tiers. Check current HUD limits.
- Investment properties. Every program requires owner-occupancy as primary residence.
A Local Realtor's Perspective
“DPA programs sound straightforward until you hit the 45-day funding window in a market where sellers want 30-day closes. When buyers come to me with a TSAHC or TDHCA pre-approval, the first thing I do is talk to the listing agent about timeline before we write the offer. Losing the right house over a funding gap is the most preventable mistake I see on this side of DFW.”
Silvia Poulin
Modern Feather Realty Group
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Frequently Asked Questions
Texas first-time home buyer grants — everything buyers ask Silvia
What counts as a first-time home buyer in Texas?
You qualify if you have not owned a home as your primary residence in the past 3 years, per the IRS §143 definition used by Texas programs. Prior ownership before that window is fine. Veterans qualify regardless of prior ownership for most programs. Buying in a federally designated targeted census tract also unlocks expanded eligibility, even if you owned within the 3-year window. Texas programs apply this definition uniformly across TDHCA, TSAHC, SETH, and local DPA programs.
How much 2026 down payment assistance can I get in Texas?
State programs offer up to 5% of the loan amount. Local programs add more: Tarrant County up to $50,000, Fort Worth up to $25,000, Arlington up to $20,000. You cannot stack two state down payment grants — choose TDHCA, TSAHC, or SETH, not two of them. However, because Tarrant County's HOME program draws from a separate federal funding stream (HUD HOME Investment Partnerships), it can layer with a state program in the same transaction. See the stacking FAQ below. You can pair any state DPA program with the Mortgage Credit Certificate (MCC) for an annual federal tax credit on top of your grant. All major state programs require income below 80% AMI (or up to 120% AMI for SETH's select tiers).
What credit score do I need for first-time buyer programs in Texas?
Most 2026 first-time buyer programs require 620–640. TDHCA My First Texas Home requires 640 for FHA/VA/USDA loans, 680 for conventional. TSAHC programs require 620. SETH programs vary by tier, typically 620–640 depending on loan type. FHA 203(b) loans go as low as 580, but most DPA layered on top requires a higher score. Below 580, no DPA program is available in Texas.
What are the income limits for Texas first-time home buyer programs by county?
Most programs cap household income at 80% of Area Median Income (AMI). For a family of 4 in 2026: Tarrant County ~$82,800, Dallas County ~$87,200, Ellis County ~$79,600, Johnson County ~$75,600. Exact figures are set annually by HUD — check the table for your county and household size. Income counts all adult earners. Buyers above 80% AMI should check SETH programs, which extend eligibility to 120% AMI on select tiers at sethfc.com.
Can I use gift money for a down payment in Texas?
Yes — gift funds from family members are allowed on most loan types, though the rules differ by loan program. FHA, VA, and USDA loans allow the entire down payment and closing costs to come from a gift with no minimum buyer contribution required. Conventional loans allow gift funds but may require the buyer to contribute a percentage of the down payment from their own funds depending on the loan-to-value ratio and lender guidelines — verify with your specific lender. In every case, lenders require a gift letter stating the funds are a gift, not a loan, along with documentation of the transfer. Note that the Tarrant County HOME program requires a minimum $1,500 contribution from the buyer's own funds regardless of loan type. That requirement is separate from gift fund rules on the mortgage itself.
How long does the first-time home buyer class take in Texas?
Most HUD-approved homebuyer education courses take 6–8 hours to complete online. You can work through the material at your own pace across multiple sessions. Upon completion, you receive a TDHCA Homebuyer Education Certificate (or equivalent HUD-approved certificate), which your lender requests by name during underwriting. Budget time for this before making an offer. Funds cannot be reserved until the certificate is on file.
Is there a $7,500 government grant for first-time buyers in Texas?
No active $7,500 Texas government grant exists in 2026. The figure circulates for a few reasons. A 2008 federal tax credit used that amount — but it was a repayable loan, not a grant, and it expired long ago. A 2021 congressional proposal (H.R. 2863) floated a $15,000 refundable credit that was never enacted. Some national banks have also offered closing-cost assistance products in that range for qualifying buyers in certain markets. Bank of America's Community Homeownership Commitment program has historically included components in this range, though terms, amounts, and market availability change; contact the bank directly for current details. The state and local grants covered on this page are larger: TSAHC offers up to 5% of the loan amount (on a $300,000 purchase, that's $15,000), and Tarrant County offers up to $50,000.
Is there a first-time homebuyer tax credit in Texas for 2026?
There is no standalone federal first-time homebuyer tax credit in 2026. The only federal tax benefit available to Texas first-time buyers in 2026 is the Mortgage Credit Certificate (MCC) — a 40% annual credit on mortgage interest paid, up to $2,000/year. See the MCC section above for how it works and how to stack it with a DPA grant.
Can I buy a home in Texas with no down payment?
Yes, through two federal loan types. VA loans (active military, veterans, eligible surviving spouses) require 0% down with no loan limit for full-entitlement borrowers. USDA Rural Development loans also require 0% down for eligible rural and suburban areas. Parts of Ellis and Johnson Counties in South DFW qualify. Both still require closing costs, though seller concessions can offset them. Use the USDA Eligibility Map to check a specific address.
Can I combine multiple down payment assistance programs in Texas?
TDHCA, TSAHC, and SETH are mutually exclusive — choose one state grant, not two. That rule is hard. What many buyers miss is that Tarrant County's HOME Program draws from HUD HOME Investment Partnerships funding — a separate federal stream from any state grant. Because the funding sources differ, Tarrant County HOME can layer with a TDHCA or TSAHC grant in the same transaction, subject to current fund availability and lender approval. Builder seller concessions can also layer on top to reduce closing costs further — a common scenario on new construction in Mansfield and Midlothian. Confirm the specific combination with your participating lender before entering contract, since Tarrant County funds deplete and reset on their own cycle.
Do I have to be a U.S. citizen to qualify for Texas first-time buyer programs?
No. TSAHC and TDHCA both allow lawful permanent residents and certain non-citizen borrowers with eligible visa status. Most programs require that at least one borrower on the loan have an eligible immigration status — typically a green card (LPR), certain work visas, or DACA status depending on each lender's individual rules. Undocumented borrowers are not eligible for federally backed loans (FHA, VA, USDA) but may be eligible for some conventional programs. Confirm your specific status with a participating lender before assuming ineligibility. Individual lender rules vary, so confirm with a participating lender.
How long does it take to close with down payment assistance in Texas?
Plan for 45–60 days to close when using a DPA program in Texas. State programs like TDHCA My First Texas Home and TSAHC add processing time beyond a standard conventional closing. Buyers using Tarrant County's assistance program should allow closer to 60 days. Alert the seller's agent early and negotiate a closing date that gives the program time to fund. Do not commit to a close-in-30 contract with DPA funds involved.
Can I use down payment assistance on new construction in Texas?
Yes. TDHCA My First Texas Home and TSAHC Home Sweet Texas both allow new construction purchases, provided the home will be your primary residence and you meet income and credit requirements. In South DFW, first-time buyer transactions on new builds in Mansfield are common. Builders often contribute seller concessions that layer with DPA to reduce cash at closing further. Check the builder's preferred lender list, as not all lenders are approved for DPA programs. See the New Homes in Mansfield guide for active builders and communities.
Are there first-time home buyer incentives in Texas beyond grants?
Yes. The Mortgage Credit Certificate (MCC) converts 40% of your annual mortgage interest into a direct federal income tax credit, up to $2,000/year for the life of the loan. The Texas Veterans Land Board (VLB) Home Loan Program offers below-market rates to veterans; on a 30-year loan, even a quarter-point reduction adds up to real savings over time. USDA and VA loans eliminate the down payment entirely. And builders in South DFW frequently offer closing-cost contributions on new construction that function as de facto incentives when combined with state DPA.
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