Texas First-Time Home Buyer Programs Overview
Texas has a robust ecosystem of programs designed to help first-time buyers overcome the biggest barriers: down payments and closing costs. Here is every major program available to Central Texas buyers in 2024.
1. My First Texas Home (MFTH) — TDHCA
The Texas Department of Housing and Community Affairs (TDHCA) My First Texas Home program is the flagship state program.
What it offers:
- 30-year fixed-rate mortgage at competitive below-market rates
- Down payment assistance of 2-5% of the loan amount
- Can be paired with FHA, VA, USDA, or conventional loans
Requirements:
- Must be a first-time buyer (no home ownership in past 3 years)
- Minimum credit score: 620 for conventional; 580 for FHA
- Income limits vary by county and family size
- Purchase price limits: up to $396,000 in most Austin-metro counties
- Must complete an approved homebuyer education course
2. My Choice Texas Home — TDHCA
Identical to MFTH but open to ALL buyers — not just first-timers. Ideal for repeat buyers who want down payment assistance.
3. Texas Mortgage Credit Certificate (MCC)
What it offers:
- Federal income tax credit equal to up to 40% of annual mortgage interest paid
- Reduces your federal tax liability dollar-for-dollar each year you own the home
- Dramatically improves affordability over time
Example: On a $350,000 loan at 7%, first-year interest is approximately $24,200. MCC credit = 40% × $24,200 = $9,680 tax credit.
Requirements: Same income and purchase price limits as MFTH.
4. City of Austin Homebuyer Assistance Program (AHAP)
For buyers purchasing within Austin city limits.
- Provides deferred forgivable loans for down payment and closing costs
- Income must be at or below 80% Area Median Income (AMI)
- Home must be in Austin city limits
- Contact Austin Housing Finance Corporation (AHFC) for current availability
5. Texas State Affordable Housing Corporation (TSAHC)
TSAHC offers two programs:
Home Sweet Texas Home Loan Program:
- Fixed-rate mortgage + 3-5% down payment grant or DPA loan
- Available to all buyers (not just first-timers) in some configurations
- Income limits: up to 115% AMI in most Texas counties
Homes for Texas Heroes:
- Dedicated to teachers, firefighters, police officers, EMS, corrections officers, and veterans
- Same structure as Home Sweet Texas with priority access
6. Williamson County & Travis County Programs
Both counties occasionally offer locally-funded assistance programs. Check with your county housing authority or a HUD-approved counselor for current availability.
7. Lender-Specific Grants
Many banks and credit unions offer their own first-time buyer grants:
- Chase Homebuyer Grant: Up to $7,500 in eligible areas
- Bank of America Community Homeownership Commitment: Up to $10,000 in grant funds
- USAA HomeFirst: Down payment assistance for military members
These change frequently — ask your lender what programs they currently offer.
How to Stack Programs
Many programs can be layered (combined), which is the most powerful strategy:
- MFTH mortgage + MCC tax credit = lower rate AND annual tax savings
- TSAHC grant + conventional loan = reduced upfront cost with no repayment
Frequently Asked Questions
Income limits for MFTH vary by county and family size. In Travis County (Austin), the limit for a family of 1-2 is approximately $97,000/year; for a family of 3+, approximately $111,000/year. Williamson County (Round Rock, Georgetown) has similar limits. Check tdhca.state.tx.us for current limits.
For most buyers who plan to own the home for several years, yes — it can save thousands per year. On a $380,000 loan, the MCC can generate a tax credit of $7,000-$10,000 in the first year alone. The certificate stays with the loan as long as you own the home.
Yes, most Texas DPA programs can be used for new construction. However, the purchase price must fall within program limits ($396,000 in most Central Texas counties for MFTH). Many builder communities in Hutto, Kyle, and Buda offer homes within these limits.
