Buyer guide · Texas

TSAHC or TDHCA: how to pick the right Texas state program

Texas runs two state homebuyer agencies. Compare Homes for Texas Heroes, Home Sweet Texas and TDHCA's programs: grant vs. forgivable vs. repayable help, credit, income and the MCC.

Bottom line:

Texas has two state players. TSAHC runs Homes for Texas Heroes and Home Sweet Texas, with up to 5% as a grant or a loan forgiven after three years. TDHCA runs My First Texas Home and My Choice Texas Home, with up to 5% as a 0% second lien; on TDHCA's November 6, 2026 rate notice, My First Texas Home's help is deferred for 30 years and repaid later. You use one agency, not both, so the type of help is the deciding factor.

Two agencies, one decision

Most states have one housing finance agency. Texas has two: the Texas State Affordable Housing Corporation (TSAHC) and the Texas Department of Housing and Community Affairs (TDHCA), a state agency. Both sell 30-year fixed loans through approved lenders, both offer up to 5% in help, and both have tax credit certificates.

You don't apply to either directly. You pick a lender approved by one of them, and the lender runs the file. Your job is to know which program you want before you sit down.

The programs at a glance

Program	Who	Help	First-time rule
Homes for Texas Heroes (TSAHC)	Listed hero jobs and veterans	Up to 5%: grant, or loan forgiven after 3 years	No
Home Sweet Texas (TSAHC)	Any job, income-qualified	Up to 5%: grant, or loan forgiven after 3 years	No
My First Texas Home (TDHCA)	Any job, income-qualified	0%, 3%, 4% or 5% as a second lien	Yes, with exceptions for qualified veterans and targeted areas
My Choice Texas Home (TDHCA)	Any job	2%, 3%, 4% or 5% as a second lien	No

Grant, forgivable or repayable: what each really costs

This is where the programs split. The help can be free money, money that disappears if you stay, or money you owe later.

Grant

Both TSAHC programs offer a grant option that never has to be repaid. It is the cleanest choice for most buyers. The trade-off, if there is one, shows up in the interest rate, so compare it against the other options with your lender.

Forgivable after three years

TSAHC's other option is a second lien forgiven after three years. Per TSAHC, selling or refinancing in that window can trigger repayment, and its pages are inconsistent about whether moving out does too. If there's any chance you'll move within three years, ask the lender for the exact note language. TDHCA's My Choice Texas Home also offers a three-year forgivable 0% second on its current rate notice.

Deferred and repayable

TDHCA's November 6, 2026 rate notice lists My First Texas Home help as a 30-year deferred, repayable, 0% non-amortizing second lien. No payments, no interest, but the balance comes due when you sell, refinance or pay off the first loan. On a $290,000 loan, 5% is $14,500 you'll settle up later. That is still useful money; just know it's a loan.

Credit scores and loan types

TSAHC requires at least 620 for government loans and 640 for conventional loans. TDHCA's My First Texas Home also lists a 620 minimum. Lenders can add their own requirements on top.

Behind each program sits a federal loan type, and that loan's rules apply too:

FHA: 3.5% minimum investment with a 580+ score. Upfront premium of 1.75%, which can be financed, and an annual premium of 0.55% for the life of the loan at 3.5% down on loans up to $726,200.
Conventional 97%: 3% down, fixed rate only, at least one first-time buyer. PMI can be cancelled on request at 80% loan-to-value.
VA: 0% down, no monthly mortgage insurance, a funding fee unless you're exempt.
USDA: up to 100% financing in eligible rural areas, with household income limits.

TDHCA's My First Texas Home pairs with FHA, VA or USDA loans. My Choice Texas Home adds conventional options. TSAHC's pages say government and conventional loans; your lender confirms which types it offers on TSAHC files.

Income limits: a big gap between agencies

TSAHC raised its limits in July 2026. TDHCA's are tighter. Compare a few metros:

Metro	Heroes (170% AMFI)	Home Sweet Texas	TDHCA My First Texas Home, 3+ people
Houston	$176,800	$156,000	$119,600
San Antonio	$178,339	$157,358	$120,434
El Paso	$172,550	$152,250	$116,725 (balance of state)

One quirk helps hero households: for TSAHC's non-bond help without the credit certificate, only the borrower's own qualifying income counts toward the limit. If your spouse isn't on the loan, their paycheck may not count against you.

The mortgage credit certificate

Both agencies offer an MCC, a federal tax credit for first-time buyers. TSAHC's equals 15% of the mortgage interest you pay each year and is free when you pair it with TSAHC assistance; TSAHC says that saves $400. Its standalone MCC is suspended. The MCC brings a lower income limit, 115% of AMFI, and price limits.

TDHCA's Texas MCC can come with a TDHCA loan or on its own for a $1,000 issuance fee, subject to availability. Its credit rate is published on TDHCA's notices.

The recapture tax, in plain English

An MCC or a below-market bond loan can bring a federal recapture tax if you sell within nine years. Per the IRS instructions for Form 8828, it only applies if all three are true: you sell at a gain, your income that year is above the limit in your notice, and the formula produces an amount. It is capped at 50% of your gain. Most buyers owe nothing, but keep the notice your lender gives you.

How to choose

Hero job or veteran? Start with Homes for Texas Heroes and its grant option.
Any other job, income under TSAHC's limit? Look at Home Sweet Texas first for the grant.
Need a lower rate more than cash? Ask about each agency's no-assistance rate option.
Buying in a city with a TDHCA partner HFC? Ask whether My First Texas Home brings extra gift money there.
Owned a home recently? Heroes, Home Sweet Texas and My Choice don't require first-time status.

Rates change daily, so ask a lender to price both agencies on the same day. Then check your eligibility.

Readers also ask

Can I use TSAHC and TDHCA programs together?

No. Each agency's assistance comes with its own first mortgage, so you choose one. You can still add an MCC from the same agency and, in some areas, local gift funds.

Is TDHCA down payment assistance a grant?

Not on My First Texas Home right now. TDHCA's November 6, 2026 rate notice lists it as a 30-year deferred, repayable 0% second lien. My Choice Texas Home offers a repayable option and a three-year forgivable option.

What credit score do Texas state programs require?

TSAHC requires 620 for government loans and 640 for conventional. TDHCA's My First Texas Home lists 620. Lenders may require more.

Do I have to be a first-time buyer?

Not for Homes for Texas Heroes, Home Sweet Texas or My Choice Texas Home. My First Texas Home and the MCCs require it, with exceptions for qualified veterans and targeted areas.

Free printable: the Texas buyer's checklist. Papers, steps, programs and the questions to ask, all in one packet. Get the checklist