Best Loan Programs for Houston First Time Home Buyers

Buying your first home is a significant life milestone and a big financial step. Fortunately, special Houston first-time home buyer loans are available to make this step more straightforward. Below, we highlight some of the Texas programs you may be eligible for, including first-time homebuyer grants in Houston and City of Houston down payment assistance programs, to help you make the right decision.

My First Texas Home

The Texas Department of Housing and Community Affairs (TDHCA) offers the My First Texas Home program. Here, you can receive 30-year mortgage loans at lower interest rates, along with assistance for down payments and closing costs. One of the conditions of this loan is that you must repay the down payment assistance when you sell the house, refinance it, or pay off the mortgage. There are certain income and credit score eligibility requirements to secure this type of loan based on the county the home is in. This program is intended for first-time homebuyers who want to buy a home in Texas.

My Choice Texas Home

Another program offered through the TDHCA is the My Choice Texas Home program. This program also offers a better mortgage rate and financial assistance to help cover the down payment and closing costs. This assistance is a no-monthly payment and zero-interest second mortgage. To qualify for this loan program, you’ll need to have a credit score of at least 620. There are also income and purchase price limits based on your specific location within Texas.

Home Sweet Texas Home

The last state-based option is the Home Sweet Texas Home Loan Program, which comes from the Texas State Affordable Housing Corporation (TSAHC). This program offers a 30-year fixed-rate mortgage and down payment assistance. As with the My Choice Texas Home program, this assistance comes as either a grant or a second mortgage. However, the payment assistance amount is forgiven after three years. You can also use this program to help you obtain another type of loan, such as a Fannie Mae HFA Preferred or a Freddie Mac HFA Advantage conventional loan.

FHA Loans

Finally, there is a program available at the federal level called an FHA loan. This is a special type of loan available from the U.S. Department of Housing and Urban Development and the Federal Housing Administration created specifically for first-time homebuyers. The FHA insures the loan, which allows the lender to provide you with an optimized interest rate since they are taking on less risk. FHA loans feature better down payment requirements, reduced closing costs, and an uncomplicated credit qualifying process.

Which Loan Is Right for You?

With several Houston first-time homebuyer programs available, it’s important that you choose the right one for your situation because your first home may largely impact your financial future. To learn more, we’ve put together a first-time homebuyer guide. You can also contact us at any time to ask about other first-time homebuyer programs. We are happy to answer any questions you may have and to guide you in selecting a loan that’s right for you.