Low Income Home Buyer Programs in Texas (2026)

Texas is one of the best states in the country for low-income home buyers. The combination of a low cost of living, generous city-level forgivable loans, two strong statewide programs, and broad USDA eligibility creates paths to homeownership that simply don't exist in higher-cost states.

But "low income" is a relative term. Housing programs define it as 80% of the Area Median Income (AMI) or below, and that number varies significantly across Texas metros. In San Antonio, 80% AMI for a family of four is roughly $57,600. In Austin, it's closer to $76,800. That difference matters because it determines which programs you qualify for and how much assistance you can receive.

Here's the real opportunity most guides miss: Texas city-level DPA programs are often large enough to cover the entire down payment on a median-priced home. A $280,000 home in San Antonio with a 3.5% FHA loan requires $9,800 down. The city's HIP program provides $30,000 in forgivable assistance. That's three times the required down payment, with the surplus covering closing costs. This isn't a marginal benefit. It changes the entire math of homeownership.

This guide ranks the best programs available to low-income Texas buyers in 2026, explains how AMI limits work, and shows you exactly how to stack programs for the lowest out-of-pocket cost.

What "Low Income" Means for Texas Home Buyer Programs

Housing assistance programs use Area Median Income (AMI) as the measuring stick. If your household income falls at or below 80% of your area's median, you're classified as low income for housing program purposes. Some programs extend eligibility to 115% AMI, but the most generous assistance, especially city-level forgivable loans, targets the 80% AMI threshold.

Here's what 80% AMI looks like across Texas metros for a family of four in 2026:

Important: AMI limits are set by county and adjusted for household size. A single buyer has a lower threshold than a family of four. Always check the specific county limits for the program you're applying to.

Best Programs for Low-Income Texas Buyers, Ranked

We ranked these programs based on total assistance value, accessibility (credit score floors, income limits), forgiveness terms, and how well they serve buyers at 80% AMI or below.

City-Level Programs: Where the Real Money Is

Texas city-level DPA programs offer the largest dollar amounts and the most favorable terms for low-income buyers. These are forgivable loans, meaning the assistance is forgiven if you stay in the home for the required period. They target buyers at 80% AMI or below.

Houston HAP: Up to $50,000 Forgivable

Houston's Homebuyer Assistance Program is one of the largest city-level DPA programs in the country. It provides up to $50,000 in forgivable assistance for buyers purchasing within Houston city limits. The program targets households at 80% AMI or below and requires a 620 minimum credit score. The forgiveness period requires you to remain in the home as your primary residence for a set number of years.

For more Houston-area programs, see our Houston DPA guide.

Dallas DHAP: $50,000-$60,000 Forgivable

The Dallas Homebuyer Assistance Program provides between $50,000 and $60,000 in forgivable down payment and closing cost assistance. Like Houston's program, it targets buyers at 80% AMI or below within Dallas city limits. The program is funded through federal HOME and CDBG funds, and availability depends on annual funding cycles.

See all Dallas-area options in our Dallas DPA guide.

Austin City DPA: Up to $40,000

Austin's city-level DPA program offers up to $40,000 in forgivable assistance for low-income buyers purchasing within city limits. Austin's higher home prices (median around $420,000) mean this assistance doesn't stretch as far as it does in San Antonio or Houston, but it still covers the full 3.5% FHA down payment on homes up to roughly $1.14 million. The real value is in offsetting closing costs on more moderately priced Austin homes.

Explore all Austin options in our Austin DPA guide.

San Antonio HIP: $30,000 Forgivable, 580 Credit

San Antonio's Homeownership Incentive Program is the standout program for low-income Texas buyers. Here's why: the $30,000 forgivable assistance combined with San Antonio's $280,000 median home price creates the best ratio of DPA to home price of any major Texas city. An FHA loan at 3.5% on a $280,000 home requires just $9,800 down. The HIP program covers that three times over, with the remaining balance going toward closing costs.

The 580 minimum credit score is the lowest of any major city program in Texas, making this accessible to buyers who might not qualify elsewhere.

Full breakdown in our San Antonio DPA guide.

Fort Worth HAP: $25,000 Forgivable

Fort Worth's Homebuyer Assistance Program provides up to $25,000 in forgivable assistance for low-income buyers. While the dollar amount is smaller than Houston or Dallas, Fort Worth's lower median home prices make this assistance proportionally competitive. The program follows the same general structure as other Texas city DPA programs: 80% AMI income limits, first-time buyer requirement, and forgiveness tied to continued occupancy.

Statewide Programs: Available Everywhere in Texas

If you're buying outside a major city, or if city funds are depleted, these statewide programs are your primary options. They're also stackable with city programs in some cases.

TSAHC Home Sweet Texas: 5% Grant, No First-Time Requirement

The Texas State Affordable Housing Corporation's Home Sweet Texas program is the most versatile statewide DPA option. It provides a 5% grant (not a loan) toward down payment and closing costs. The grant does not need to be repaid. Income limits vary by county but typically fall between 80% and 115% AMI, meaning most low-income buyers qualify comfortably.

The key advantage: TSAHC does not require first-time buyer status. If you've owned a home before, you can still use this program. That flexibility is unusual for DPA programs and makes TSAHC valuable for buyers who owned previously but are now in a lower income bracket.

TDHCA My First Texas Home: 5% Deferred/Forgivable

The Texas Department of Housing and Community Affairs runs My First Texas Home, which provides up to 5% in deferred, forgivable down payment assistance. The assistance is structured as a second lien that can be forgiven over time. Income limits hover around 115% AMI, and a first-time buyer requirement applies (remember: no homeownership in the past three years counts as first-time).

Both TSAHC and TDHCA offer Mortgage Credit Certificates (MCCs) that can be paired with the DPA. The MCC provides a federal tax credit worth up to $2,000 per year for the life of the loan. For a low-income buyer, that $2,000 annual savings is significant, effectively reducing your mortgage cost by roughly $167 per month.

Additional Options for Low-Income Texas Buyers

USDA Loans: Zero Down Payment in Suburban Texas

USDA Rural Development loans require zero down payment and have income limits of 115% AMI, making them one of the best options for low-income buyers. The key restriction is geography: the property must be in a USDA-eligible area. In Texas, that covers a surprisingly large footprint. Many growing suburbs outside Houston, San Antonio, Dallas, Austin, and Fort Worth qualify. Cities like New Braunfels, Kyle, Conroe, and Weatherford are all within USDA-eligible zones.

USDA loans also have lower mortgage insurance costs than FHA, which means a lower monthly payment on the same purchase price. The trade-off is the geographic restriction and a slightly higher credit score requirement (typically 640 for automated underwriting).

Chenoa Fund: 3.5% Forgivable, No Income Limits

The Chenoa Fund provides 3.5% in forgivable down payment assistance paired with an FHA first mortgage. It accepts credit scores as low as 580 and has no income limits. For low-income buyers who don't qualify for city programs (perhaps they're buying outside city limits) or who need a backup option, the Chenoa Fund fills a valuable gap. The rate advantage option is forgiven after 36 on-time payments.

The trade-off: Chenoa Fund loans typically carry a higher interest rate on the first mortgage compared to TSAHC or TDHCA options. Run the numbers with your loan officer to compare the total cost.

Habitat for Humanity Texas Affiliates

Habitat for Humanity operates through local affiliates across Texas, offering affordable mortgage terms for very low-income families. The model is different from traditional DPA. Instead of providing a grant or forgivable loan on a market-rate home, Habitat builds or rehabilitates homes and sells them to qualifying families at cost, with zero-interest or low-interest mortgages. Buyers contribute sweat equity hours as part of the qualification process. If your income is well below 80% AMI, Habitat may be the most impactful path to homeownership.

The MCC Tax Credit: $2,000/Year Most Buyers Overlook

The Mortgage Credit Certificate is one of the most underused benefits available to low-income Texas buyers. Both TSAHC and TDHCA offer MCCs that let you claim a portion of your annual mortgage interest as a dollar-for-dollar federal tax credit, up to $2,000 per year. This isn't a deduction. It's a credit, meaning it reduces your tax bill directly.

On a $280,000 FHA loan at 6.5% interest, you'd pay roughly $18,200 in mortgage interest in the first year. An MCC at a 20% rate would give you a $2,000 tax credit (the annual cap). Over a 10-year hold, that's $20,000 in tax savings on top of whatever DPA you received for the down payment. The MCC stacks with DPA programs, meaning you can get a TSAHC grant for your down payment and an MCC for ongoing tax savings.

Your lender can also count the MCC income toward your qualifying ratios, potentially helping you qualify for a larger loan.

Common Mistakes Low-Income Texas Buyers Make

Frequently Asked Questions

Find Your Best Path to Homeownership

Every buyer's situation is different. Your city, county, income level, credit score, and whether you've owned before all determine which programs you can access. A buyer in Houston qualifies for a different mix than someone in San Antonio or Dallas. Our free tool matches you with every available program in about two minutes.