Texas Department of Housing and Community Affairs (TDHCA) Texas Homebuyer Program

The Texas Department of Housing and Community Affairs (TDHCA) is a state government agency that runs several programs designed to promote the construction of new, affordable housing and to help Texans with low to moderate incomes purchase their own homes.

The TDHCA offers two down payment assistance options through its Texas Homebuyer Program. 

The first option, My First Texas Home, is a forgivable lien for first-time homebuyers and veterans. The second option, My Choice Texas Home, is available to anyone who meets the income limits and lives in Texas, even if they’ve owned a home before.

TDHCA My First Texas Home 

The My First Texas Home program is down payment assistance in the form of a forgivable lien. It is available everywhere in Texas, and it offers the option of either a three-year forgivable lien or a 30-year deferred repayment lien. 

The three-year forgivable lien doesn’t need to be repaid as long as you continue to live in the home and make your mortgage payments on time for three years after closing.

Both lien types can be combined with the Texas Mortgage Credit Certificate. 

Find out if you may qualify.

How much assistance can you get?

Both lien options come with down payment assistance of up to 5% of the home’s purchase price.

Does the assistance have to be paid back?

This depends on whether you get a three-year forgivable lien or a 30-year deferred repayment lien.

Three-year forgivable lien 

This assistance doesn’t need to be repaid as long as you do not sell or refinance the home within the first three years after closing, and provided you consistently make your mortgage payments on time during that period. After the three-year period, the lien is fully forgiven. 

30-year deferred repayment lien 

This does have to be paid back, but it is designed to be financially feasible for most homebuyers. 

The assistance is provided to you through a no-interest, no monthly payment second lien. The second lien only needs to be repaid when you sell the home, or when you refinance or pay off the initial mortgage. 

To qualify, you must take out an initial mortgage backed by TDHCA, which usually comes with a lower interest rate. Also, the assistance lien is not considered as part of your debt load when you qualify for your initial mortgage loan. 

What is the purchase price limit?

The purchase price limit ranges between $481,176 and $712,097, depending on where in Texas you buy your home.

How much do you need to contribute?

The program has no minimum borrower contribution, so you aren’t required to put down any of your own money in order to qualify for assistance.

What are the criteria to qualify?

To qualify for My First Texas Home down payment assistance, you must meet the following requirements:

1. You must be a first-time homebuyer (meaning you haven’t owned or purchased a home within the past three years). This requirement is waived if you are a veteran.
2. The property must be in the state of Texas.
3. You’ll need a credit (FICO) score of 620 or higher.
4. Your income must be below the program threshold, which currently falls between $63,040 and $163,520, depending on your loan type and where in Texas you buy. 
5. Your total debts after closing must be 55% or less of your monthly income. 

Note that TDHCA regularly reviews its income limits. While these figures were accurate at publication, they will change over time. Use our free down payment assistance finder to check if you may qualify. 

TDHCA My Choice Texas Home

The My Choice Texas Home down payment assistance lien operates in a similar way. It is available everywhere in Texas and provides assistance in the form of either a three-year forgivable lien or a 30-year deferred repayment lien, as described above. It can also be combined with the Texas Mortgage Credit Certificate.

The primary difference is that My Choice Texas Home has no first-time homebuyer requirement. It also has different income and purchase price limits.

Find out if you may qualify.

How much assistance can you get?

This program offers up to 5% of the purchase price in down payment assistance. 

Does the assistance have to be paid back?

If you consistently make your monthly mortgage payments on time and don’t move, rent out, or sell the house for the first three years, you won’t have to pay back the three-year lien. 

The 30-year lien does have to be paid back, but it accrues zero interest and doesn’t need to be repaid until the end of your initial thirty year mortgage. Because your initial mortgage has to be a TDHCA-backed loan in order to qualify for this type of assistance, you will most likely have a lower interest rate on this loan as well. 

What is the purchase price limit?

There are no purchase price limits for this program. You can purchase a home of any price as long as you meet the program income limits and other eligibility requirements.

How much do you need to contribute?

You won’t need to put down any of your own money for this program, as there is no minimum borrower contribution.

What are the criteria to qualify?

To qualify for My Choice Texas Home, you must meet these requirements:

1. The property must be in Texas. 
2. You’ll need a credit (FICO) score of 620 or higher.
3. Your income must be lower than the program threshold, which currently falls between $56,000 and $149,875, depending on your loan type and where in Texas you buy your home. 
4. Your total debts after closing must be 55% or less of your monthly income. 

TDHCA regularly reviews its income limits. While these figures were accurate at publication, they will change over time. Use our free down payment assistance finder to check if you may qualify. 

Choosing between My First Texas Home and My Choice Texas Home

The biggest deciding factor between the two programs is whether or not you are a first-time homebuyer, since both programs offer the same types of liens with up to 5% in down payment assistance.

The My First Texas Home lien does have a slightly higher income limit. However, this program also has a first-time homebuyer requirement. Be sure to consult a mortgage professional to determine which program is best for you.

How to apply for down payment assistance through TDHCA

To qualify for down payment assistance through the TDHCA, you must submit your application through a lender that is approved to make TDHCA applications. To find a lender and find out if you might qualify for a TDHCA down payment assistance use our free down payment assistance finder.