TEXAS Down payment Assistance Programs
Programs are designed to assist buyers to purchase homes primarily for primary residences. There are currently NO assistance programs for investors or the purchase of investment properties or second homes. ONE important NOTE that needs to be made is that buyers CAN NOT directly apply to the assistance provider for the funds being granted. Buyers must apply with a participating lender and the lender applies for the assistance as part of the financing process. Some programs have set interest rates and other programs allow the lender to set the interest rate based on current market conditions. Some programs have minimum credit score requirements and other programs defer to the lender’s guidelines. So working with a lending team that specializes in the origination, processing, underwriting and closing of these types of programs is crucially important. The BBMC Lending Team specializes in these programs and has the unique benefit of offering an extensive array of programs in Illinois.
Additional requirements for these programs include the completion of a pre-purchase home buying class and the receipt of a home buying certificate. some program require an HUD approved eight hour class and others will allow the completion of an on-line class. Please consult with someone on our team to determine what class you need to complete.
TDHCA – Texas Department of Housing and Community Affairs: TMP-79
Up to 5% of loan amount. 30 year recapture – due on sale, refinance, transfer, or other disposition or assumption of first mortgage.
First time home buyer (targeted area buyers & veteran exempt); 115% Area Median Income limit. No area restrictions entire state of Texas. Must complete approved Home Buying Education Course. Minimum credit score of 620, No Max DTI. Minimum borrower contribution greater of $1,000 or 1%. 1-2 unit Owner Occupied properties ONLY. May be used with VA, FHA, USDA and Conventional Fannie ONLY. Purchase price limits from $327,106 to $403,938 based on county limit.
TSAHC – Texas State Affordable Housing Corporation: MCC Stand Alone (Mortgage Credit Certificate)
TSAHC provides 30-year fixed interest rate mortgage loans, down payment assistance grants, and mortgage credit certificates through the following programs.
Homes for Texas Heroes Home Loan Program: for teachers, fire fighters and EMS personnel, police and correctional officers, and veterans.
Home Sweet Texas Home Loan Program: for Texas home buyers with low and moderate incomes.
Loans w/ Down Payment Assistance:
- Credit scores as low as 620
- No max DTI w/AUS approval
- Low fees
- Third Party Originators allowed
- FHA manual underwrites allowed up to 43% DTI with no additional fee (640 minimum FICO score required)
- FHA non-traditional credit allowed with no additional fee
- Simplified income limits
Mortgage Credit Certificates (MCC):
- A dollar for dollar savings of up to $2,000 every year as a special tax credit
- Helps the home buyer qualify by reducing the DTI
- No minimum credit score or maximum DTI requirements
- May be used with any fixed-rate loan product or combined with TSAHC’s Down Payment Assistance
- FREE for those Texas Heroes also using TSAHC’s Down Payment Assistance.
- Simplified income limits
- Exclusively for first-time home buyers
SETH 5 Star Texas Advantage – South East Texas Housing
Up to 5% of loan amount for Conventional loans and 4% for FHA loans. TRUE Grant; no minimum borrower contribution. Qualified income eligible; Does not need to be a First Time Buyer; Entire State of Texas – Excluding specific areas – (City Limits of: Grand Prairie, El Paso. Travis County); FHA Min Score of 640 w/ max DTI 45% OR Min score of 660 w/ max DTI 50%; Freddie Conv min score 640 and 50% DTI. FHA, VA, and USDA 1-4 Units. Freddie Conventional only 1 unit properties; applicable household income only includes borrower and anyone secondarily liable on note; Must be owner occupied; Purchase price limits FHA, VA, USDA, Conv Max $453,100.
Affordable Income Subsidy Grant: 80% AMI are eligible for an additional grant of $1,500 and 50% AMI will receive an additional $2,500