NO REPAYMENT REQUIRED
Free Down Payment Assistance
Planning to purchase a home in Texas? You can now receive free funds to help cover your down payment and/or closing costs.
How to Qualify
3 Main Qualifications
1
Primary Residence
To be eligible for the down payment assistance program, you must intend to occupy the property you are purchasing as your primary residence.
2
Minimum Credit Score
The program requires a minimum credit score of 620 for down payment assistance with FHA, VA, and USDA financing or a 640 credit score for conventional financing.
3
Income Limit
The program has generous income limits based on the county you are purchasing a home in. Please see the FAQ section below for more info about income limits.
Down Payment Assistance Options
You can choose from the following 3 down payment assistance options.
Grant
Overview: This grant never has to be repaid regardless of how long you keep the mortgage. It comes with no strings attached, and you can pay off the mortgage at anytime and not be obligated to repay the grant funds you receive.
Mortgage Options: FHA, VA & USDA
Minimum FICO Score: 620
Down Payment Assistance Options: 2%, 3%, or 4% of your loan amount
Best Suited For: Borrowers who may pay off their mortgage within 3 years and don’t want to worry about paying back the down payment assistance funds they receive.
The disadvantage of this down payment assistance is that your mortgage interest rate will be higher for this option versus the other two options.
Forgivable 2nd Lien
Overview: This is also free down payment assistance that doesn’t have to be repaid. However, you have to keep the mortgage for at least 3 years before the down payment assistance money you receive will be forgiven.
Mortgage Options: FHA, VA, USDA & Conventional
Minimum FICO Score: 620 for FHA, VA and USDA. 640 for Conventional
Down Payment Assistance Options: 2%, 3%, 4% or 5% of your loan amount
Best Suited For: Borrowers who know they will keep their mortgage for at least 3 years. The interest rate on this mortgage will be lower than the first option.
The down payment assistance you receive will be a second lien. No interest is charged, and there is never a payment due on it. It just remains there until you've had your mortgage for 3 years. If you are current on your mortgage at that time, the second lien will be forgiven and removed from title.
Repayable 2nd Lien
Overview: With this option, the down payment assistance you receive has to be repaid when you sell your home or refinance your mortgage. However, the advantage it offers is that it comes with a lower interest rate than the first two options.
Mortgage Options: FHA, VA & USDA
Minimum FICO Score: 620
Down Payment Assistance Options: 5% of your loan amount
Best Suited For: Borrowers who plan to keep their mortgage long term (8+ years). While the down payment assistance you receive has to be repaid when you eventually sell or refinance, the interest rate for your mortgage with this option is the lowest of the 3 options. If you plan to keep your mortgage for 8+ years, it typically makes the most sense to go with this option.
The down payment assistance you receive will be a second lien. No interest is charged, and there is never a payment due on it. It just remains there until you sell or refinance.
Must be a first-time homebuyer
Please note: The Mortgage Credit Certificate (MCC) is now available in combination with Options 1 & 2 above. You must be a first-time homebuyer to qualify for the MCC.
Program FAQs
Answers to some commonly asked questions about our down payment assitance programs.
How much can I make and still qualify for this program?
The max income limits for the down payment assistance program differ based on the county you purchase in and which of the 3 down payment options you choose. For Options 1 and 2, below are the max income limits for the 10 largest counties in Texas as a reference, and please contact us to find out the income limit for the specific county you plan to purchase in, if it is not listed below.
Harris County: $156,000. Dallas County: $181,650. Tarrant County: $165,450. Bexar County: $157,358. Travis County: $201,600. Collin County: $181,650. Denton County: $181,650. Fort Bend County: $156,000. Hidalgo County: $152,250. El Paso County: $152,250
The max include limit for down payment assistance Option 3 is listed below for the 10 largest counties in Texas, and again, please contact us to find out the income limit for the specific county you plan to purchase in, if it is not listed below.
Harris County: $83,200. Dallas County: $96,880. Tarrant County: $88,240. Bexar County: $83,924. Travis County: $107,520. Collin County: $96,880. Denton County: $96,880. Fort Bend County: $83,200. Hidalgo County: $81,200. El Paso County: $81,200
Why not take the max down payment assistance possible?
The reason you may not want to take the max down payment assistance possible is because the more you take in down payment assistance, the higher the interest rate will be for your mortgage. In some situations, it could make more sense to either ask the seller to cover all or part of your closing costs or to put in a little money yourself, if you have funds available.
Will this be complicated and require a lot of paperwork?
Unlike many down payment assistance programs that require a lot of additional paperwork, this down payment assistance program is very simple and straight forward. In fact, your loan will be underwritten according to the standard underwriting guidelines for the loan type (Conventional, FHA, VA, or USDA) you choose. The only difference is that you just need to meet the minimum credit score and income requirements for the down payment assistance program you are applying for.
Do I need to mention the down payment assistance in my offer?
No, you can write up your offer just like you would if the down payment and/or closing costs are coming out of your own pocket. In your offer, you will simply list the amount of down payment you're making (including the down payment assistance you're receiving) and the type of mortgage you are using. If some of your down payment assistance is going towards your closing cost, it does not have to be disclosed on your offer. If you're going to ask the seller to cover some of your closing costs, you would include this request in the offer just as you normally would. As far as the seller is concerned, your offer will look the same as it would if all of the funds were coming directly from you.
What types of properties are eligible for this program?
Eligible properties include single family residences, condos, townhomes as well as entire duplexes, triplexes, or fourplexes (if one unit is owner occupied) and manufactured homes (require a 640+ FICO score). Investment properties and second homes are not eligible.
Can I still close on a home in 30 days with this program?
Yes, closing on your mortgage with this down payment assistance program can be done in the normal amount of time as any other transaction.
Learn More
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(512) 593-4157
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info@homefinancingdirect.com
Interested in our special down payment assitance program? We'd love to answer any questions you might have and to also get you preapproved for the program!
Please reach out anytime!