Texas Down Payment Assistance Compared:
TSAHC, TDHCA and SETH
How Texas Down Payment Assistance Actually Works
Every program on this page works the same basic way. A state agency provides your 30-year fixed mortgage through a participating lender. The agency then adds assistance worth 2% to 5% of your loan. You use that money for your down payment and closing costs.
The assistance comes in three forms. The form you choose sets your rate, so start here:
- A grant. Money you keep after six months. TSAHC offers this on government loans only (FHA, VA, USDA), never on conventional. It also carries the highest interest rate of the three forms.
- A forgivable second lien. A zero-interest, no-payment loan that disappears after 3 years (TSAHC, TDHCA) or 10 years (SETH MyHome Plus) if you keep the home. Sell or refinance early and you repay it.
- A repayable second lien. Zero interest, no monthly payment, but the balance comes due when you sell, refinance, or hit year 30. In exchange, it carries the lowest rate.
One more mechanic that surprises people: the percentage applies to your loan amount, not the purchase price. TSAHC’s guidelines specify assistance is a percentage “of the total loan amount.” On a $350,000 home with 3% down, a 3% assistance award is 3% of the $339,500 loan (about $10,185), not 3% of the price. With FHA’s financed mortgage insurance in the loan, the math shifts again. Your lender runs the exact numbers before you commit.
TSAHC: Home Sweet Texas and Homes for Texas Heroes
The Texas State Affordable Housing Corporation runs two programs that are the same product with different income ceilings. Homes for Texas Heroes serves teachers, teacher aides, school librarians, counselors and nurses, police and public security officers, firefighters and EMS, corrections and juvenile corrections officers, county jailers, veterans and active military, and nursing or allied health faculty. Home Sweet Texas serves everyone else. TSAHC’s own words: “Both programs offer the same down payment assistance options.”
What Heroes adds is headroom: income limits about 13% higher (170% of area median income instead of 150%), plus a free mortgage credit certificate: the $400 issuance fee is waived. In Tarrant County that means a Heroes household can earn up to $187,510 and still qualify. Home Sweet Texas allows $165,450. Neither number is a “low-income” cutoff, which is exactly why so many buyers wrongly rule themselves out.
| TSAHC option | Loan types | Min FICO | Repay? |
|---|---|---|---|
| Grant (2%–5%, per current availability) | FHA, VA, USDA only | 620 | No, after 6 months |
| 3-year forgivable second (2%–5%) | All, incl. conventional | 620 gov / 640 conv. | Forgiven at year 3 |
| 30-year repayable second (4%–5%) | FHA, VA, USDA (bond) | 620 | At sale, refi, or yr 30 |
Source: TSAHC program guidelines, revised August 3, 2026, and the TSAHC rate and program page, read August 8, 2026.
Two facts about TSAHC that almost no national article gets right. First, the plain assistance program has no purchase price limit. The guidelines state: “For Non-Bond DPA (no MCC), there are no purchase price limits when using the Non-Bond DPA by itself.” Second, you do not have to be a first-time buyer for the assistance — that rule only applies when you add a mortgage credit certificate or use the bond-funded track.
TDHCA: My First Texas Home and My Choice Texas Home
The state housing department runs the other two programs, and the names tell you who they serve. My First Texas Home is the bond program: first-time buyers (or anyone who has not owned in 3 years), government loans only, and the lowest rates on this page: 5.750% with no assistance on the August 7, 2026 rate notice. My Choice Texas Home drops the first-time rule entirely. TDHCA’s description: “30-year, low-interest mortgage rates for everyone, you do not have to be a First Time Homebuyer to qualify.”
My Choice also has no purchase price limit, is not subject to federal recapture tax, and counts only the borrower’s income. A non-purchasing spouse’s income does not count against you. My First Texas Home counts household income including a non-purchasing spouse, which trips up more DFW families than any other rule on this page.
TDHCA prices its two second-lien structures differently than TSAHC does, and the pattern is worth knowing: the 30-year repayable second runs roughly half a point cheaper in rate than the 3-year forgivable second at the same assistance level. You pay for forgiveness with rate. If you plan to stay in the home long past year 3 anyway, price both structures before assuming forgivable wins.
One genuine TDHCA exclusive: it still offers a stand-alone mortgage credit certificate: a 15% federal tax credit on mortgage interest you can pair with any lender’s loan for a $1,000 fee ($400 when combined with the program loan, waived for military). TSAHC discontinued its stand-alone MCC. If the tax credit is the only piece you want, TDHCA is the only statewide door.
SETH 5 Star: The Grand Prairie Fine Print
The Southeast Texas Housing Finance Corporation sounds like a Houston operation, and its 5 Star Texas Advantage program mostly is not: it runs nearly statewide. The official eligibility line: “available in Texas but outside of Travis County and the city limits of El Paso, Grand Prairie and McKinney.”
Read that list again if you shop in DFW. Grand Prairie city limits are excluded. Grand Prairie spreads across Dallas, Tarrant, and Ellis counties. A Tarrant County address can still be ineligible if it sits inside Grand Prairie. This is a city-limits check, not a county check. Tarrant, Dallas, Denton, Johnson, and Ellis counties are otherwise all eligible.
The program itself: up to 5% of the loan amount, as either a 3-year forgivable second or a deferred second repaid at sale, refinance, or year 30. SETH’s description promises “No payments & no accrued interest.” No first-time requirement. No maximum sales price. The credit floor is 640, the highest of the three agencies, though SETH’s sibling program MyHome Plus (a 10-year forgivable second) accepts 620.
Which Program Fits You
Your lender runs the final numbers, but the decision usually turns on four questions:
- 1Are you a teacher, first responder, veteran, or corrections officer? Start with TSAHC Homes for Texas Heroes. The higher income ceiling plus the free tax certificate is the strongest combination the state offers those professions.
- 2Is this your first home, and is income under the bond limits? Price My First Texas Home first. Its no-assistance rate (5.750% on the current notice) beats everything else on this page when you can bring your own down payment.
- 3Owned a home before, or over the bond income limits? TSAHC’s standard track, My Choice Texas Home, and SETH 5 Star all skip the first-time rule. Compare their current rate sheets side by side.
- 4Grant or second lien? Free money sounds better, but the rate sheet disagrees. On TSAHC’s current FHA pricing, a 2% grant costs 0.50% more in rate than no assistance. The 2% forgivable second costs 0.125% more. Over a 30-year loan, the “free” grant is usually the expensive option.
From the Lending Side
“The agencies set these rates, not your loan officer, and standard pricing software gets them wrong. When we price a TSAHC loan, we select the investor and key the rate straight off the agency’s daily sheet. If a quote for one of these programs looks strange, that is usually why. Ask your lender to show you the agency rate sheet itself.”
— Josh Poulin, licensed mortgage loan originator, Modern Feather
2026 Income Limits for DFW Counties
Income limits move every year, and the 2026 numbers run far higher than most buyers guess. These are the current published limits for the counties where our clients buy, any household size unless noted:
| Program | Tarrant / Johnson | Dallas / Denton / Ellis |
|---|---|---|
| TSAHC Home Sweet Texas | $165,450 | $181,650 |
| TSAHC Homes for Texas Heroes | $187,510 | $205,870 |
| TDHCA My First Texas Home (1–2 person) | $110,300 | $121,100 |
| TDHCA My Choice Texas Home | up to $199,750 | up to $199,750 |
| SETH 5 Star (Standard tier) | $205,625 | $205,625 |
Sources: TSAHC combined limits table effective June 13, 2026 (Heroes rows July 9, 2026); TDHCA limits effective July 13, 2026; SETH limits effective June 15, 2026. All read August 8, 2026. Limits differ by county. Van Zandt County, for example, runs $155,992 for Home Sweet Texas and $69,360 for the 80%-of-median conventional tier.
Two definitions hide inside these tables. The conventional loan versions of these programs have a separate tier at 80% of area median income ($94,000 in every core DFW county), and qualifying under it earns a cheaper rate and cheaper mortgage insurance. And all three agencies use the same 80% figure because they all pull from the same federal table. When your income sits near $94,000, which side of that line you land on changes your monthly payment more than which agency you pick.
City Programs You Can Add on Top
The state programs are not the only money on the table. Cities run their own assistance, generally for lower incomes and with residency rules, and some can layer with a state program loan. The biggest in our area: the Dallas Homebuyer Assistance Program, which as of May 1, 2026 is managed by BCL of Texas and offers up to $60,000 in designated High Opportunity Areas ($50,000 elsewhere) for households at or below 80% of area median income, on homes up to $342,000.
Fort Worth, Arlington, and Tarrant County each run homebuyer assistance programs of their own with separate income caps and city-limit rules. The amounts and rules change with funding cycles, so verify directly with the program office before you count on a number. If a specific city program matters to your purchase, ask us and we will pull the current terms with you.
A Local Realtor's Perspective
The buyers who use these programs well are not the ones you expect. I see two-income families earning six figures assume they make too much, when the Heroes limit in Tarrant County is $187,510. The money is there. What it costs you is rate, so the real conversation is whether the assistance beats waiting another year to save the down payment yourself. That is a math problem, not a guess, and it is worth an hour with someone who prices these programs every week.
Silvia Poulin
REALTOR®, Modern Feather Realty Group · License #835307
Related Reading
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The full playbook: credit, loan types, inspections, and every program in one place.
Texas Property Tax 2026: The Complete Homeowner Guide
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New Construction Homes in Mansfield, TX
Builders, base prices, and how to negotiate incentives that stick.
VA Loans on New Construction in Texas
What the VA requires from builders, and where deals get stuck.
Frequently Asked Questions
Texas down payment assistance — what buyers ask us most
Do you have to be a first-time home buyer to get down payment assistance in Texas?
No, in most cases. TSAHC's assistance, TDHCA's My Choice Texas Home, and SETH 5 Star all allow repeat buyers. TSAHC's guidelines state: "Borrowers are not required to be first-time home buyers." The first-time rule only applies to TDHCA's My First Texas Home and to mortgage credit certificates, and veterans are exempt from it there.
What credit score do you need for Texas down payment assistance?
620 for most options. TSAHC and both TDHCA programs set a 620 minimum on government loans (FHA, VA, USDA). TSAHC's conventional option requires 640, and SETH 5 Star requires 640 across the board. SETH's MyHome Plus accepts 620. Below 640 on a TSAHC government loan, lenders may add a 0.25% origination charge.
How much down payment assistance can you get in Texas?
Between 2% and 5% of your loan amount, depending on the program and current availability. Note the base: it is the loan amount, not the purchase price. On a $350,000 purchase with an FHA loan, 5% assistance is roughly $17,000 to $17,500 once the financed mortgage insurance is included, and it can cover both down payment and closing costs.
Do you have to pay back Texas down payment assistance?
It depends on the form. Grants are yours to keep after six months. Forgivable second liens are erased after 3 years (TSAHC, TDHCA) or 10 years (SETH MyHome Plus) if you keep the home as your residence; sell or refinance earlier and you repay the balance. Repayable second liens are due at sale, refinance, or year 30 — with zero interest and no monthly payment either way.
What are the income limits for down payment assistance in DFW?
Higher than most people expect. In Tarrant County the 2026 limits run from $110,300 (TDHCA My First Texas Home, 1–2 person household) up to $187,510 (TSAHC Homes for Texas Heroes) and $205,625 (SETH Standard tier). Dallas, Denton, and Ellis counties run slightly higher on the TSAHC tiers. Limits update annually, so check the current tables.
Can you use down payment assistance on any price of home?
Often, yes. TSAHC's standard assistance, TDHCA's My Choice, and SETH 5 Star publish no purchase price limit — TSAHC's guidelines say "there are no purchase price limits" for its non-bond option. The bond-funded tracks do cap price: $589,596 in the core DFW counties for 2026. Loan limits for FHA or conventional still apply.
Ready to Run Your Numbers?