First-Time Buyer Programs in Texas: DPA, Loan Limits, and Income Thresholds for 2026

Texas is the second-largest state in the country by population and the largest state in terms of annual housing transactions. It’s also one of the most underexamined DPA markets because Texas runs two separate state housing finance agencies rather than the single-HFA model used by most states. The result: more program options, broader buyer eligibility, but also more confusion about which program to use. The right combination of TSAHC + TDHCA + local Texas DPA programs reduces typical first-time buyer cash-to-close on a $400K Texas purchase by $15,000-$35,000 — meaningful money in a state where homeownership rates are already among the highest in the country.

This guide aggregates Texas-specific programs: TSAHC (Texas State Affordable Housing Corporation) and TDHCA (Texas Department of Housing and Community Affairs), county FHA loan limits (note: Texas has NO high-cost designations for 2026 conforming limits — all counties at baseline), AMI thresholds for HomeReady / Home Possible, the Texas Mortgage Credit Certificate (MCC) tax-credit program, and local government DPA programs in Houston, Dallas, Austin, San Antonio, and Fort Worth.

Quick answer: Texas first-time buyers have access to (1) TSAHC Home Sweet Texas Home Loan — DPA grant or second mortgage up to 5% of loan amount, paired with FHA / VA / USDA / Conventional, (2) TSAHC Homes for Texas Heroes — enhanced DPA (5-7%) for teachers, first responders, veterans, corrections officers, and qualifying healthcare workers, (3) TDHCA My First Texas Home — DPA grant or second mortgage up to 5% of loan amount, (4) TDHCA My Choice Texas Home — same DPA structure but available to repeat buyers too, (5) Texas MCC — federal tax credit up to $2,000/year for qualifying first-time buyers. Plus local DPA in major metros. ALL Texas counties carry the FHFA baseline conforming limit of $832,750 (no high-cost designations). FHA loan limits are at the baseline floor of $524,225 in most TX counties, with mid-tier limits in some Austin / Dallas / Houston metro counties. Income eligibility for most programs caps at 80-115% of HUD AMI. FICO floor 620-640 on most programs. Best path: pre-qualify with a wholesale broker who maps TSAHC + TDHCA + local DPA + MCC against your specific income, profession, and target purchase area.

On This Page

• Why Texas Has Two State HFAs
• TSAHC Programs
• TDHCA Programs
• TSAHC vs TDHCA: Which Do I Use?
• Texas Mortgage Credit Certificate (MCC)
• FHA and Conforming Loan Limits in Texas
• Local Government DPA in Major TX Metros
• Specialty Profession Programs
• Worked Example: Dallas First-Time Buyer
• Texas-Specific Considerations
• FAQs

Why Texas Has Two State HFAs

Most states run a single state housing finance agency. Texas runs two:

• TSAHC (Texas State Affordable Housing Corporation) — a 501(c)(3) nonprofit chartered by the Texas Legislature in 1994 to operate affordable housing programs statewide.
• TDHCA (Texas Department of Housing and Community Affairs) — a state government agency that administers federal HUD funds and state housing programs.

Both run first-time buyer DPA programs. Both work with the same wholesale lenders. The programs are similar in structure but have different income tiers, FICO floors, geographic emphasis, and profession-specific eligibility. The buyer’s job isn’t to understand the political history of why Texas has two HFAs — it’s to figure out which one’s program works best for their specific situation. A wholesale broker familiar with both can model the options.

TSAHC Programs

TSAHC Home Sweet Texas Home Loan Program

TSAHC’s general first-time buyer program. DPA available as either:

• Grant: 2-5% of loan amount. Never repaid.
• Repayable second mortgage: 3-5% of loan amount at 0% interest, 30-year forgivable structure (forgiven if you stay 3 years).

First mortgage pairings: FHA, VA, USDA, or Conventional (HomeReady or Home Possible).

Income eligibility: tiered by household size and county. Most TX metro households earning under $115,000 qualify for some tier.

FICO minimum: 640 for most pairings, 620 for some FHA pairings.

First-time buyer requirement: typically yes, defined as no home ownership in past 3 years.

TSAHC Homes for Texas Heroes Program

TSAHC’s flagship profession-specific program with enhanced DPA. Available to:

• Active duty and veteran military.
• Allied health faculty members.
• Certified educators (teachers, school librarians, school nurses, school counselors).
• Corrections officers and juvenile corrections officers.
• EMS personnel.
• Firefighters.
• Peace officers (police).
• Public security officers.

DPA structure: 3-7% of loan amount as grant or repayable second.

The Texas Heroes advantage: the DPA amounts are higher than general TSAHC programs, AND the program waives the first-time buyer requirement in some scenarios (active duty military can use it even if they’ve owned a home before).

First mortgage pairings: same as Home Sweet Texas Home Loan.

TDHCA Programs

TDHCA My First Texas Home

TDHCA’s primary first-time buyer DPA program.

• DPA amount: up to 5% of loan amount.
• Structure: non-amortizing second mortgage at 0% interest, with the principal due at sale, refinance, or end of mortgage term.
• First mortgage pairings: FHA, VA, USDA, or Conventional.
• FICO minimum: 620.
• First-time buyer requirement: yes (no ownership in 3 years).

TDHCA My Choice Texas Home

Same DPA structure as My First Texas Home but available to repeat buyers as well.

• DPA amount: up to 5% of loan amount.
• Income limits: typically higher than My First Texas Home.
• First-time buyer requirement: NO — repeat buyers welcome.

My Choice Texas Home is the most underused program in Texas DPA because it serves repeat buyers — a population most state HFAs don’t serve at all.

TSAHC vs TDHCA: Which Do I Use?

The two-HFA structure means buyers can shop between them. General guidance:

A wholesale broker familiar with both runs the comparison and quotes the structure that produces the lowest combined cost.

Texas Mortgage Credit Certificate (MCC)

Both TSAHC and TDHCA administer Mortgage Credit Certificate (MCC) programs. The MCC is a federal tax credit (not a deduction) worth up to $2,000/year for qualifying first-time buyers.

How it works: a qualifying first-time buyer receives an MCC at closing. Each year going forward, you can claim a percentage (typically 20-25%) of your mortgage interest paid as a direct credit against federal income tax. The credit caps at $2,000/year.

Worked example. $375,000 mortgage at 6.25%. First-year mortgage interest paid: ~$23,100. MCC credit at 25%: $5,775. Capped at $2,000/year — effective federal tax credit is $2,000.

Over 10 years that’s $20,000 in cumulative federal tax savings. Over the typical 30-year loan, $60,000+. The MCC stacks with DPA — you can use both on the same purchase.

Critically: Texas has no state income tax, so the MCC credit is purely against your federal tax bill. No state-tax adjustment to consider.

FHA and Conforming Loan Limits in Texas

Texas has the simplest loan limit landscape of any large state in the country.

FHFA Conforming Loan Limits (for HomeReady, Home Possible, standard conventional):

• All Texas counties: $832,750 baseline. Texas has no high-cost designations for 2026 conforming limits.

FHA Loan Limits: $524,225 floor across most TX counties. Some Austin metro counties (Travis, Williamson, Hays), Dallas-Fort Worth metro (Collin, Dallas, Denton, Tarrant), and Houston metro (Harris, Fort Bend, Galveston, Brazoria, Montgomery) carry mid-tier FHA limits in the $600,000-$700,000 range.

VA Loan Limits: full-entitlement borrowers have no county loan limit — up to lender underwriting maximum. Partial-entitlement borrowers subject to FHFA conforming limit ($832,750).

Strategic implication. Texas’ flat baseline conforming limit means buyers shopping above $832,750 quickly hit non-conforming jumbo loan territory — including in Austin, Dallas, and Houston metros where home prices have risen substantially. For purchases above the baseline, work with a wholesale broker who can structure conventional jumbo or non-QM options.

Local Government DPA in Major TX Metros

Houston. The City of Houston runs the Homebuyer Assistance Program (HAP) offering up to $50,000+ for income-eligible first-time buyers in Houston city limits. Harris County also operates separate DPA programs.

Dallas. Dallas Homebuyer Assistance Program (DHAP) provides up to $60,000+ for qualifying buyers. Dallas County and surrounding counties have their own programs.

Austin. Austin’s Down Payment Assistance Program (run through Austin Housing Finance Corporation) provides up to $40,000+ for moderate-income buyers within Austin city limits. Particularly valuable given Austin’s housing affordability pressure.

San Antonio. The City of San Antonio Office of Neighborhood Services administers DPA up to $25,000+ for income-eligible buyers.

Fort Worth. City of Fort Worth Homebuyer Assistance Program provides up to $20,000+ for qualifying buyers.

El Paso, Corpus Christi, Lubbock, Plano, Arlington all run versions of local DPA at various funding levels.

Most of these local programs can stack on top of TSAHC or TDHCA. A Houston teacher could potentially combine TSAHC Homes for Texas Heroes + Houston HAP + Texas MCC for combined assistance exceeding $80,000.

Specialty Profession Programs

Beyond the TSAHC Texas Heroes program, additional profession-specific programs exist:

• Texas Veterans Land Board (VLB). Separate from TSAHC and TDHCA, the VLB offers home loan programs specifically for Texas veterans — including the Texas Veterans Home Loan Program (TVHLP) that provides rate discounts on home purchases.
• Local school district programs. Many Texas school districts run employer-sponsored DPA for teachers and staff (Houston ISD, Dallas ISD, Austin ISD, Fort Worth ISD).
• Healthcare system programs. Major Texas medical centers (Texas Medical Center, UT Southwestern, MD Anderson) often have employer DPA.
• Energy sector employers. Some large Texas energy companies run employee homeownership assistance.

Worked Example: Dallas First-Time Buyer

Jessica, age 29, is a Dallas ISD high school teacher. Annual income: $62,000. FICO: 705. Target purchase: $325,000 townhome in northeast Dallas.

Without DPA — cash requirements:

• 3.5% FHA down payment: $11,375.
• Closing costs: ~$8,000.
• Reserves: ~$3,000.
• Total cash needed: ~$22,375.

With stacked Texas DPA:

• TSAHC Homes for Texas Heroes FHA pairing: 5% DPA grant = $15,675. Covers FHA down payment and some closing costs.
• Dallas Homebuyer Assistance Program (DHAP): additional $20,000 forgivable second.
• Dallas ISD employer DPA: $2,500 grant.
• TSAHC MCC: $2,000/year federal tax credit going forward.
• Jessica’s out-of-pocket: ~$2,500 — reduced from $22,375 by 89%.

Jessica’s monthly mortgage payment also drops because the Dallas $20,000 DPA reduces her FHA loan amount by that much — meaning lower monthly P&I and lower monthly MIP. Plus the MCC provides ongoing federal tax savings of $2,000/year.

Texas-Specific Considerations

No state income tax. Texas has no state income tax. This affects DPA strategy in two ways: (1) the federal MCC credit is the only tax credit consideration (no state credit interaction), and (2) deduction-management at the federal level is the only tax-planning lever — making mortgage interest deductions and SALT cap considerations slightly different than in income-tax states.

High property tax. Texas effective property tax averages 1.6-2.0% — among the highest in the country. On a $400K home that’s $533-$667/month in property tax PITI. The high property tax does NOT affect DPA eligibility but it does affect overall affordability math — the DTI threshold gets reached at a lower mortgage amount than in low-property-tax states.

Texas property tax exemptions. Texas has a homestead exemption that reduces the assessed value of a primary residence by $100,000 (school tax purposes). This produces meaningful annual savings — first-time buyers should file the homestead exemption application immediately after closing.

Texas does NOT have a recapture tax. Unlike many state HFA programs, TSAHC and TDHCA don’t trigger federal recapture tax on resale in most scenarios.

Frequently Asked Questions

Should I use TSAHC or TDHCA?

Depends on profession, income, and FICO. Texas Heroes (teachers, first responders, military, corrections officers) use TSAHC Homes for Texas Heroes for enhanced DPA. Repeat buyers use TDHCA My Choice Texas Home. Most other situations need a side-by-side comparison — a wholesale broker familiar with both can model the cheapest combined cost.

Can I stack TSAHC and TDHCA on the same purchase?

No, generally only one of the two as the primary DPA. But you CAN stack the chosen state HFA program with a local city/county DPA + the MCC + employer DPA.

What’s the maximum home price I can buy with Texas DPA?

Most programs cap qualifying purchase price at or near the conforming loan limit ($832,750). Some programs have lower caps for specific income tiers. Above the cap, DPA isn’t available but you can still use FHA, VA, or conventional with standard underwriting.

Do I have to attend homebuyer education?

Yes, for all TSAHC and TDHCA DPA programs. The course is online, typically 4-6 hours, and satisfies multiple programs simultaneously.

Can I use the MCC and DPA together?

Yes. The MCC is a tax benefit, DPA is purchase assistance — they stack cleanly.

What credit score do I need?

620 minimum for most TDHCA programs. 640 minimum for most TSAHC programs. Some FHA pairings accept 580.

I’m a Texas veteran — should I use VLB or a regular VA Home Loan?

Different products. The federal VA loan provides 0% down and no PMI with the VA backing. The Texas VLB provides Texas-specific rate discounts that can be stacked with a VA loan for Texas veterans. Many Texas vets use both. A wholesale broker familiar with VA and VLB can structure the right combination.

Ready to Map Your Texas Options?

Texas first-time buyer financing is complex because of the dual-HFA structure (TSAHC and TDHCA) plus rich local DPA in major metros. The wrong choice wastes thousands. The right combination stacks state HFA + local DPA + MCC + employer programs for combined assistance reducing cash-to-close by $20,000-$60,000+.

At OnPoint Mortgage Pro, we’re Texas-licensed, with active broker relationships at both TSAHC and TDHCA plus local DPA agencies across Houston, Dallas-Fort Worth, Austin, San Antonio, and El Paso. We map your specific income, FICO, profession, and target purchase area against the available Texas DPA stack — identifying which combinations you qualify for and which produces the lowest combined cost.

Call us at (877) 870-0007. Bring your income, FICO, target purchase area, and profession/employer, and we’ll model your Texas DPA stack.

Texas has more first-time buyer assistance options than any other state — in part because of the dual-HFA structure. Most buyers don’t know which program fits them. Call us at (877) 870-0007 and we’ll model the comparison.

See Also: Related Broker Resources

• Down Payment Assistance Demystified — national DPA overview.
• First-Time Buyer Programs California — sibling state.
• FHA Loan Complete Guide
• HomeReady & Home Possible 3% Down
• VA Loan Complete Guide
• Retirement Funds for Down Payment
• How Much House Can You Afford in Texas?
• Texas Mortgage Programs Overview

Victor Santos, NMLS #888844, is a Senior Loan Officer and licensed mortgage broker. OnPoint Mortgage Pro (NMLS #2134550) is licensed in Texas and 8 other states. TSAHC and TDHCA program details, income limits, FHA / conforming loan limits, and DPA amounts on this page reflect representative June 2026 program assumptions. Programs change — confirm current eligibility and amounts with TSAHC, TDHCA, your wholesale broker, or the relevant local agency before relying on specific terms. This article is for educational purposes only and is not a commitment to lend. Equal Housing Lender.