Dallas Down Payment Assistance and First-Time Homebuyer Programs

Dallas is a relatively affordable city for first-time homebuyers, especially compared to other flagship cities around the country. It’s also a pretty ideal place to settle down, given the robust economy of the Dallas-Fort Worth metro area.

However, buying in a city as affordable and desirable as Dallas still comes with significant upfront costs. All told, your down payment and closing costs can stack up to tens of thousands of dollars.

Fortunately, there are a good number of down payment assistance and first-time homebuyer programs available to residents of Dallas and those looking to move to the area. These include local, city-sponsored programs, as well as several national and state-level options.

Using down payment assistance could make all the difference between buying a home in a great city right away, or trying to save up for years to cover those upfront costs.

Disclaimer: This article is for informational purposes only and should not be considered as legal or financial advice. Please consult an attorney, mortgage lender, or CPA for guidance on your specific situation.

Types of down payment assistance for Dallas homebuyers

As is the case across Texas, down payment assistance (DPA) in Dallas usually comes in the form of forgivable loans and liens. 

Although they are called by two different names, forgivable loans and liens work in fundamentally the same way: a loan or lien is placed on your house, but it is forgivable, meaning you don’t have to repay the money as long as you meet certain criteria.

Occasionally, homebuyers in Dallas will qualify for other types of assistance, such as grants or discounted mortgage loans. But by and large, if you use DPA, it will be a forgivable loan.  

Learn more: Considering buying in Ft. Worth instead? Read our complete list of Ft. Worth down payment assistance.

Dallas first-time homebuyer loans

More often than not, forgivable loans and liens for first-time homebuyers are considered fully forgiven after you live in the home for a specified number of years (without refinancing, selling, or renting it out), and provided you consistently make your mortgage payments on time.

Some of these loans and liens are not forgiven until you completely repay your mortgage, but this is a far less common scenario. 

Even less common are programs which offer non-forgivable loans. These loans must be completely repaid, but they are structured so that making the loan payments isn’t a financial challenge for first-time homebuyers.

Down payment assistance programs in Dallas

Down payment assistance in Dallas comes from several different sources. There are citywide programs, programs that cover Dallas County as a whole, statewide programs, and finally, national down payment assistance programs.

It’s good to have so many options, but it also means there is a lot of information to absorb.

Stairs Financial makes it easy to get all the information you need and move smoothly through the process of using down payment assistance. Stairs connects you with a trusted lender and shows you all of the loan and assistance programs you qualify for, so you can compare your options in one place. 

Learn more.

Dallas Homebuyer Assistance Program

The Dallas Homebuyer Assistance Program offers $50,000 to $60,000 in forgivable down payment assistance loans to residents of the city. Buyers who have lived in Dallas for at least 10 years or who work in education, healthcare, or emergency services get higher income limits when applying for this program.

Assistance type: Deferred forgivable loan

Sponsor: City of Dallas

Assistance amount: $60,000 maximum

Purchase price limit: None

Minimum borrower contribution: $1,000

Eligibility requirements:

• Current resident of Dallas
• Purchasing within city limits
• $10,000 or less in liquid assets
• Income limit for buyers who work in education, healthcare, or emergency services: 120% of area median income
• Income limit for all other buyers: 80% of area median income

*For all DPA programs, purchase price and income limits are regularly reviewed and updated. Be sure to check the most current limits before assuming you don’t qualify. 

Down payment assistance and first-time buyer programs in Dallas County

There are two local programs available to Dallas County residents who don’t live within Dallas city limits. The first is a countywide forgivable loan, and the second is a loan available only to people buying in the city of Irving. 

Dallas County Home Loan Upfront Cost Assistance Program (UPCAP)

The Dallas County Home Loan Upfront Cost Assistance Program (UPCAP) is a $7,500 deferred forgiveness loan for homebuyers purchasing in Dallas County. Loan funds can be used to make a larger down payment, pay closing costs, and cover other qualified expenses.

Assistance type: Deferred forgivable loan

Sponsor: Dallas County

Assistance amount: $7,500 maximum

Purchase price limit*: $318,000

Minimum borrower contribution: $1,000 or 1% of the purchase price, whichever is greater

Eligibility requirements: 

• First-time homebuyer 
• Purchasing in unincorporated Dallas County or within the city limits of: Balch Springs; Coppell; Glenn Heights; Sachse; Cedar Hill; Duncanville Hutchins; Seagoville; Cockrell Hill; Farmers Branch; Lancaster; or Wilmer.
• Income limit*: 80% of area median income.

City of Irving Down Payment Assistance Program

The City of Irving Down Payment Assistance Program offers forgivable down payment assistance loans up to $50,000 for first-time homebuyers in Irving. The loan can be forgiven after a period of between five and twenty years, depending on the loan amount, provided you have not sold, refinanced, or moved out of the home.

Assistance type: Deferred forgivable loan

Sponsor: City of Irving

Assistance amount: $50,000 maximum

Purchase price limit: None

Minimum borrower contribution: $1,000 or $1,500 depending on the type of home purchased

Eligibility requirements:

• First-time homebuyer
• Purchasing within city limits
• Income limit: At or below 80% of area median income (AMI)

Statewide down payment assistance programs available in Dallas

These Texas-based down payment assistance programs are available to eligible first-time homebuyers purchasing in Dallas. 

TSAHC Home Sweet Texas HFA Loan

The Home Sweet Texas HFA Loan is a down payment assistance loan available everywhere in Texas that can be fully forgiven if you don’t sell or refinance the home for a period of three years after purchase. 

This program can also be combined with the Texas Mortgage Credit Certificate (MCC) tax credit which we describe in greater detail below.

Assistance type: Forgivable loan

Sponsor: Texas State Affordable Housing Corporation

Assistance amount: Up to 5% down payment, no fixed maximum

Purchase price limit: None

Minimum borrower contribution: None

Eligibility requirements: 

• Purchasing in Texas
• Credit (FICO) score of 620 or higher
• Income limit*: $71,280 to $97,840 depending on location of home

TSAHC Homes for Texas Heroes HFA Loan

The Homes for Texas Heroes HFA Loan is a forgivable down payment assistance loan program available to Texas residents working in certain helping professions. The loan can be combined with the Mortgage Credit Certificate (MCC) tax credit, and it can be forgiven if you do not sell or refinance the home within three years.

Assistance type: Forgivable loan

Sponsor: Texas State Affordable Housing Corporation

Assistance amount: Up to 5% down payment, no fixed maximum

Purchase price limit: none 

Minimum borrower contribution: None 

Eligibility requirements: 

• Purchasing in Texas
• A veteran, or currently working as: a teacher, emergency medical professional, nurse, law enforcement officer, or active duty service member 
• Credit (FICO) score of 620 or higher
• Income limit: $126,140 to $163,520 depending on location of home

SETH 5 Star Texas Advantage Forgivable Lien

The 5 Star Texas Advantage Forgivable Lien provides down payment assistance in the form of a community second lien which is forgiven after three years, provided you do not sell or refinance the home in that time. 

Assistance type: Forgivable loan

Sponsor: Southeast Texas Housing Finance Corporation

Assistance amount: Up to 5% down payment, no fixed maximum 

Purchase price limit for FHA loans*:  $472,030 to $571,550 (depending on location)

Purchase price limit for all other loan types: $492,500 

Minimum borrower contribution: None 

Eligibility requirements: 

• Purchasing anywhere in Texas except Travis County, El Paso, McKinney, and Grand Prairie
• Credit (FICO) score of 640 or higher 
• Income limit for USDA-backed loans: $56,880 to $170,800 depending on location 
• Income limit for all other loan types: $78,820 to $171,220 depending on location

TDHCA My First Texas Home Down Payment Assistance

My First Texas Home Forgivable Down Payment Assistance is a down payment assistance program that offers funding to first-time homebuyers in the form of a second lien that can be structured either as a three-year forgivable lien, or as a 30-year deferred repayment lien.

Assistance type: Forgivable loan

Sponsor: Texas Department of Housing and Community Affairs Homebuyer Program

Assistance amount: Up to 5% down payment, no fixed maximum

Purchase price limit: none

Minimum borrower contribution: None 

Eligibility requirements: 

• First-time homebuyer purchasing in Texas
• Credit (FICO) score of 620 or higher 
• Income limit: $90,100 to $163,520 based on location of home

TDHCA My Choice Texas Home Down Payment Assistance

My Choice Texas Home Down Payment Assistance is a program with no first-time homebuyer requirement. Funds are delivered as second liens which can be structured either as a three-year forgivable lien, or as a 30-year deferred repayment lien.

Assistance type: Forgivable loan

Sponsor: Texas Department of Housing and Community Affairs Homebuyer Program

Assistance amount: Up to 5% down payment, no fixed maximum

Purchase price limit: $481,176 to $712,097 depending on location of home 

Minimum borrower contribution: None 

Eligibility requirements: 

• Purchasing in Texas
• Credit (FICO) score of 620 or higher
• Income limit: $90,100 to $163,520 depending on location of home

Veterans Housing Assistance Program

The Veterans Housing Assistance Program offers discounted mortgage loans for veterans and active duty service members to purchase a home in Texas. The funding can be structured as a 15, 20, 25, or 30 year loan. It requires minimal or no down payment and offers interest rates which are typically lower than the market rate. 

Assistance type: Discounted mortgage loan

Sponsor: Veterans Land Board

Assistance amount: up to $726,200 loan 

Minimum borrower contribution: none 

Eligibility requirements: 

• Purchasing in Texas 
• Veteran or active duty service member
• Income limit: none

National down payment assistance programs and grants you can use in Dallas

Whether you’re purchasing a home in Dallas, or looking further afield, you might qualify for down payment assistance sponsored by the National Homebuyer Fund. We’ve included details about the program below. 

NHF Down Payment Assistance Program

The NHF Down Payment Assistance Program provides a down payment assistance loan which can be forgiven if the home is your primary residence for a certain number of years. The number of years required to forgive the loan is determined at closing.

Assistance type: Forgivable loan

Sponsor: National Homebuyer Fund

Assistance amount: up to 5% down payment, no fixed maximum

Purchase price limit: Flexible, based on buyer’s income

Minimum borrower contribution: None 

Eligibility requirements: 

• Credit (FICO) score of 600 or higher
• Income limit*: 115% of median income in area where home is purchased

In addition to the National Homebuyer Fund, you could potentially qualify for a lender-sponsored assistance program through one of the nation’s largest banks. These programs vary from lender to lender. Stairs Financial does not endorse any single lender-sponsored DPA program over the next.  

Dallas down payment assistance program FAQ

Here are some straightforward answers to the most common questions about Dallas down payment assistance programs. 

What first-time homebuyer programs are available in the city of Dallas and Dallas County?

These are the first-time homebuyer programs available in Dallas and Dallas County:

• Dallas Homebuyer Assistance Program
• City of Irving Down Payment Assistance Program
• Home Sweet Texas HFA Loan
• Homes for Texas Heroes HFA Loan
• 5 Star Texas Advantage Forgivable Lien
• My First Texas Home Down Payment Assistance Lien
• My Choice Texas Home Down Payment Assistance Lien
• Veterans Housing Assistance Program
• NHF Down Payment Assistance Program

How does down payment assistance work in Texas?

Down payment assistance in Texas follows the same process as in other states. You apply for assistance through your lender, typically when you apply for your mortgage loan. From there, your assistance funds get paid either directly to you, or to your lender..

If you receive your down payment assistance funds directly, bear in mind that you must use them to cover expenses approved by your program.

How much is a down payment for a house in the city of Dallas (on average)?

According to the National Association of Realtors, the nationwide average down payment for first-time homebuyers is 6%. The median price for a house in Dallas is $309,505. Based on these numbers, the average down payment for a house in the city of Dallas is $18,330.30.

Remember this is the average down payment, not necessarily the optimal or recommended amount. Most mortgage lenders give you a lower interest rate if you make a 5%, 10%, or 20% down payment. Therefore, increasing your down payment from 5 to 6% may not be the best use of your money. 

It might be more financially beneficial to make a 5% down payment and use that extra 1% to buy down your interest rate through mortgage points. Your lender will help you run the numbers and decide what makes the most sense for your situation

What is the income limit for down payment assistance in Dallas?

The income limit for down payment assistance in Dallas is set by each program, so it varies. However, the most common threshold is 80% of the area median income, adjusted for the number of people in your household. 

80% of the median income for a family of four in Dallas is $82,500. 

These income limits are reviewed and revised often, so always check the most current limits before assuming you don’t qualify.

What is the minimum credit score for down payment assistance in Dallas?

Each down payment assistance program sets its own minimum credit score. The most common minimum credit score for DPA programs in Dallas is 620. That being said, there are programs that require a slightly higher minimum score of 640, as well as ones that accept as low as 580. A few programs have no minimum.

What is a mortgage credit certificate and does it apply to first time homebuyers in Dallas and Dallas County?

The Mortgage Credit Certificate (MCC) is a federal tax credit that applies to homebuyers nationwide, including in Dallas and Dallas County. The MCC reduces your federal taxes by 20% of the total mortgage interest you paid during the year. You receive this in the form of tax refund. 

How do I find information about the Dallas Homebuyer Assistance Program?

The Dallas Homebuyer Assistance Program offers up to $60,000 to those buying a home in the city of Dallas. The program is a forgivable loan and can be combined with the MCC tax credit. You can find more information in the local section of this article. 

Learn all about the Dallas down payment assistance programs you qualify for

Stairs Financial streamlines your access to down payment assistance, making it easy for you to connect with a trusted lender and compare the loan and assistance programs you may qualify for, all in one place.

Learn more about your down payment assistance options.