Unlocking the Dream of Homeownership in Texas
Two Statewide Organizations Leading the Way
Everything is indeed bigger in Texas, including the opportunities for first-time home buyers. The Lone Star State boasts two statewide organizations, the Texas Department of Housing and Community Affairs (TDHCA) and the Texas State Affordable Housing Corporation (TSAHC), which offer a range of innovative programs to help individuals achieve their dream of homeownership.
A Closer Look at TDHCA and TSAHC
These two organizations don’t provide loans directly; instead, they partner with approved private mortgage lenders to offer affordable housing programs. You can also find local programs at the county and municipal levels through the U.S. Department of Housing and Urban Development’s website.
Multiple Ways to Save with My First Texas Home
The My First Texas Home program is designed for low-to-moderate-income individuals, offering a 30-year mortgage loan with a fixed low interest rate. This program also provides assistance worth up to 5% of the first mortgage amount for down payment or closing costs, which comes in the form of a forgivable 0% interest second mortgage. Additionally, you can access a mortgage credit certificate (MCC) to save money on your federal income taxes.
My Choice Texas Home: More Options for Home Buyers
The My Choice Texas Home program offers similar savings to My First Texas Home, but with some key differences. This program is available to repeat home buyers and those with higher incomes, and it works with conventional loans as well as government-backed FHA, VA, and USDA loans. However, you cannot receive an MCC through this program.
Home Sweet Texas: Down Payment Assistance and More
The Home Sweet Texas program offers FHA, VA, USDA, and HFA conventional first mortgages, along with down payment or closing cost assistance worth up to 5% of the loan amount. You can also access a 15% MCC if you’re a first-time home buyer.
Homes for Texas Heroes: Exclusive Benefits for Public Service Workers
The Homes for Texas Heroes program is reserved for home buyers with specific public service jobs, such as teachers, first responders, and veterans. This program offers 30-year fixed-rate mortgages and down payment assistance worth up to 5% of the loan amount, along with an MCC to save on federal income taxes.
Eligibility Requirements: What You Need to Know
To qualify for these programs, you’ll need to meet specific eligibility requirements, including:
- A minimum credit score of 620 (640 for TSAHC HFA conventional loans)
- A debt-to-income ratio of 45% to 50%
- Income limits based on the median income of the area you’re buying in
- Sales price limits based on the type of home and area
- Completion of a home-buyer education course
Applying for a Program: A Simple Process
Both TDHCA and TSAHC have straightforward application processes that allow you to work with your chosen lender to complete. TDHCA outlines three steps to apply for one of their programs, while TSAHC has a four-step process.
Getting Started on Your Path to Homeownership
If you’re a Texas resident looking to buy a home, you may qualify for down payment assistance through TDHCA or TSAHC. With a minimum credit score of 620 and meeting specific eligibility requirements, you can take the first step towards achieving your dream of homeownership.
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