Best Down Payment Assistance Programs in Texas (2026)

Who This Guide Is For

This guide is for anyone buying a home in Texas who wants help covering the down payment or closing costs. That includes first-time buyers, repeat buyers, veterans, teachers, nurses, first responders, and anyone earning below the income limits set by each program.

Texas is one of the best states in the country for down payment assistance. The statewide programs offer true grants (money you never repay), and the major cities layer on additional programs worth $25,000 to $60,000. Most buyers qualify for at least two or three options.

The challenge is not finding programs. The challenge is choosing the right one. A 5% grant sounds identical across two programs until you compare the first mortgage rate, the forgiveness timeline, and the eligibility restrictions. That is what this guide sorts out for you.

We ranked every major program by real value to the buyer, weighing the assistance type (grants beat forgivable loans, which beat deferred loans), accessibility, credit requirements, and whether the program restricts you to first-time buyers only.

All 11 Programs at a Glance

Full Program Rankings

Programs ranked by overall value: assistance type (grant > forgivable > deferred), accessibility, credit flexibility, and first-time buyer restrictions.

#1. TSAHC Home Sweet Texas

This is the best DPA program in Texas, and one of the best in the entire country. The assistance is a true grant: 5% of the loan amount that you never repay. There is no forgiveness period, no deferred balance, and no shared appreciation. The money is yours at closing.

The program is open to both first-time and repeat buyers, which is unusual for a state-run DPA program. You need a 620 minimum credit score, must meet income limits (which vary by county and household size), and the home must be your primary residence. It works with FHA, VA, USDA, and conventional loans through TSAHC-approved lenders.

Why it ranks #1: A grant is the most valuable form of DPA because there is nothing to repay. Combined with no first-time buyer restriction and a 620 credit floor, this program is accessible to the widest range of Texas buyers. It also pairs with the MCC tax credit for up to $2,000/year in additional savings.

#2. TSAHC Homes for Texas Heroes

Same 5% grant structure as Home Sweet Texas, but reserved for professionals in public service: military and veterans, teachers, police officers, firefighters, EMS workers, corrections officers, and nurses. No first-time buyer requirement.

If you qualify under both Home Sweet Texas and Homes for Texas Heroes, the Heroes program may offer a slightly lower interest rate on the first mortgage. Check with your lender to compare the two side by side.

Why it ranks #2: Identical grant structure to #1, but limited to specific professions. If you are in one of those occupations, this may actually be the better option due to potentially lower rates. It also pairs with the MCC tax credit.

#3. TDHCA My First Texas Home

The Texas Department of Housing and Community Affairs (TDHCA) offers 5% of the loan amount as either a deferred second mortgage or a 3-year forgivable loan. The deferred option has no monthly payments but the balance is due when you sell, refinance, or pay off the first mortgage. The forgivable option is written off after 36 months of on-time payments.

This program requires first-time homebuyer status (haven't owned a home in 3 years), but veterans are exempt from that requirement. It works with FHA, VA, and USDA loans. Income and purchase price limits apply.

Why it ranks #3: The 3-year forgivable option is nearly as good as a grant if you plan to stay in the home. It ranks below TSAHC because a forgivable loan still carries conditions. The deferred option is solid for buyers who want lower upfront costs but plan to keep the home long-term. Pairs with the MCC tax credit.

#4. TDHCA My Choice Texas Home

Identical terms to My First Texas Home, but without the first-time buyer requirement. If you are a repeat buyer who does not qualify for TSAHC Home Sweet Texas (perhaps due to income limits or lender availability), My Choice Texas Home is your next best statewide option.

Why it ranks #4: Same assistance as #3 but open to repeat buyers. It ranks below My First Texas Home because the first mortgage terms are typically comparable, and the TSAHC grant programs above it provide a strictly better assistance type. Still an excellent option that pairs with the MCC tax credit.

#5. SETH 5 Star

The Southeast Texas Housing Finance Corporation (SETH) 5 Star program offers 5% as either a grant or a forgivable loan, depending on the option you select. No first-time buyer requirement. The program works across most of Texas but specifically excludes Travis County (Austin) and El Paso.

The higher 640 credit score requirement and geographic exclusions are the main reasons it ranks below the TSAHC and TDHCA options. If you are buying outside Austin and El Paso and have a 640+ score, this is a strong contender, especially if the grant option is available through your lender.

Why it ranks #5: Grant option matches #1 in value, but the higher credit bar and geographic restrictions reduce accessibility. Worth comparing against TSAHC programs through your lender to see which offers the better first mortgage rate.

#6. Houston Homebuyer Assistance Program (HAP)

Houston's HAP is one of the most generous city-level DPA programs in the country. Up to $50,000 in forgivable assistance that is written off after 5 years of living in the home. You must buy within Houston city limits, earn at or below 80% of the Area Median Income, and be a first-time buyer.

The dollar amount alone makes this program transformative for Houston buyers who qualify. On a $250,000 home, $50,000 covers 20% down, potentially eliminating mortgage insurance entirely. See all Houston DPA programs.

#7. Dallas Homebuyer Assistance Program (DHAP)

Dallas offers $50,000 to $60,000 in assistance, with a $10,000 bonus for buyers purchasing in an HOA-governed community. Income must be at or below 80% AMI. The program is for first-time buyers purchasing within Dallas city limits.

This is the highest dollar-amount city program in Texas. Funding is allocated annually and tends to move quickly when applications open. See all Dallas DPA programs.

#8. San Antonio Homeownership Incentive Program (HIP)

San Antonio's HIP offers up to $30,000 in forgivable assistance with one of the lowest credit requirements of any city program in Texas: 580 minimum. Income limits are set at 80% AMI. The forgiveness terms make this an excellent option for buyers who plan to stay in the home.

The 580 credit floor means buyers who cannot qualify for statewide programs (which require 620+) still have a path to homeownership in San Antonio. See all San Antonio DPA programs.

#9. Austin City Down Payment Assistance

Austin offers up to $40,000 in down payment and closing cost assistance for buyers purchasing within city limits. Given that SETH 5 Star excludes Travis County, this city program is especially important for Austin buyers who want a local option beyond the TSAHC and TDHCA statewide programs.

Austin's real estate market is among the most expensive in Texas, which makes this assistance particularly meaningful. See all Austin DPA programs.

#10. Fort Worth Homebuyer Assistance Program

Fort Worth's HAP provides up to $25,000 in forgivable assistance for first-time buyers purchasing within city limits. While the dollar amount is lower than Houston and Dallas, Fort Worth's lower home prices mean this assistance covers a larger percentage of the purchase.

#11. Chenoa Fund (Backup Option)

The Chenoa Fund is a nationwide program that works as a backup when state and local options do not fit. It provides 3.5% of the FHA loan amount as a forgivable second mortgage (forgiven after 36 on-time payments). There are no income limits, no first-time buyer requirement, and the minimum credit score is 580.

The tradeoff is a higher interest rate on the first mortgage compared to TSAHC or TDHCA programs. Use Chenoa when you are over income limits for state programs or need the lowest credit score threshold. See Chenoa Fund details for Texas.

The MCC Tax Credit Most Buyers Miss

Every TSAHC and TDHCA statewide program can be paired with the Mortgage Credit Certificate (MCC). This is a federal tax credit (not a deduction) that lets you claim up to $2,000 per year as a dollar-for-dollar reduction on your federal taxes for the life of the loan.

Over a 30-year mortgage, that is up to $60,000 in tax savings. The MCC also increases your qualifying income because lenders can count the tax credit as additional income when calculating your debt-to-income ratio. This means you may qualify for a larger loan.

The MCC is one of the most overlooked benefits in Texas homebuying. It costs a one-time fee (typically $500 to $800) and the savings compound every year. If you are using a TSAHC or TDHCA program, ask your lender about adding the MCC before closing.

How to Choose the Right Program

Use this decision framework to narrow your options quickly:

Common Mistakes to Avoid

Choosing a program based only on the dollar amount. A $50,000 city program sounds better than a 5% statewide grant, but the city program may require you to stay 5 years, have stricter income limits, and offer less flexibility. The 5% grant on a $300,000 loan is $15,000 with zero strings attached. Compare the full picture.

Ignoring the first mortgage rate. DPA programs are funded in part through a slightly higher interest rate on the first mortgage. The spread varies between programs. A quarter-point difference on a $300,000 loan is roughly $50/month, or $18,000 over 30 years. Ask your lender to compare the total cost, not just the DPA amount.

Skipping the MCC tax credit. The MCC is worth up to $60,000 over the life of the loan. It takes 10 minutes to add during the application process and costs a small one-time fee. Every buyer using a TSAHC or TDHCA program should request it.

Assuming you do not qualify. Income limits in Texas are more generous than most buyers expect. In many metro areas, households earning $100,000+ still qualify for statewide programs. Use the eligibility tool to check before ruling yourself out.

Waiting for a "better" program to open. City programs run on annual funding cycles and often close once the allocation is exhausted. If you qualify for a program today, apply now. The statewide TSAHC and TDHCA programs are continuously funded, so those are less time-sensitive.

Frequently Asked Questions

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Find Out Which Programs You Qualify For

Every buyer's situation is different. Your county, income, credit score, and profession all determine which programs you can access. A buyer in Harris County qualifies for a different mix than someone in Travis County or Bexar County. Our free tool matches you with programs across all 254 Texas counties in about 2 minutes.