What Does It Take to Qualify for Down Payment Assistance?

June 10, 2016 | by Katie Claflin

Categories: First Time Buyer, Homeownership

It may be easier than you think! There are several misconceptions about down payment assistance programs, including the belief that programs are only available for first-time home buyers and that programs aren’t available in your community.

But the truth is there are many programs available, so you may be eligible for assistance without even realizing it.

Down Payment Resource recently created a blog post to combat these misconceptions by outlining the six basic criteria required by most down payment assistance programs. Below we have addressed each of these qualifications in depth to help you determine if you qualify for a down payment grant from TSAHC.

Home Buyer Criteria
  1. Income and Financial Requirements. You must meet certain income, credit and debt requirements to qualify for TSAHC’s down payment assistance. We have created a short, four-question eligibility quiz to help you determine if you meet our income requirements, which can vary depending on your profession, household size and county. The last page of the quiz will also direct you to our credit score and debt requirements.
  2. Profession. TSAHC’s Homes for Texas Heroes program provides down payment assistance specifically to teachers, police officers, fire fighters, EMS personnel, corrections officers, and veterans.  However, you don’t have to fall into one of these categories to qualify for down payment assistance. We offer another program, the Home Sweet Texas Loan Program, that is not profession-specific, so you can still qualify if you meet certain income requirements. 
  3. First-Time Home Buyer Status. You do not have to be a first- time home buyer (defined as anyone who has not owned a home in the past three years) to receive down payment assistance through TSAHC. However, if you are a first-time home buyer you can also qualify for a special income tax credit program known as a Mortgage Credit Certificate (MCC). TSAHC's MCC Program can be combined with our down payment assistance and can save you thousands of dollars over the life of your mortgage loan. Click here to learn more.
Home Criteria
  1. Primary Residence. TSAHC requires that you live in the home you are buying as your primary residence. That means you can’t use our program to purchase a second home or a rental property.
  2. Sales Price of the Home. The home that you buy cannot exceed certain purchase price limits. The limits are set based on a percentage of the median home price in each county, which means that the purchase prices are higher in counties where homes are more expensive.
  3. Location of the Home. TSAHC’s down payment programs are statewide, so you can use our programs to purchase a home anywhere in Texas.  

Want to know more? Watch our free webinar on the home buying process. You’ll learn the 10 steps to buying a home and receive a tutorial on our down payment assistance and MCC programs.  Click here to learn more.


On the House blog posts are meant to provide general information on various housing-related issues, research and programs. We are not liable for any errors or inaccuracies in the information provided by blog sources. Furthermore, this blog is not legal advice and should not be used as a substitute for legal advice from a licensed professional attorney.

Comments

rdeleon

Hello Katherine,

Thank you for your question.

You do not have to be a first time homebuyer on any of our non-bond DPA only options.  Please check out our website for availability:  https://www.tsahc.org/home-buyers-programs#Interest_Rates.

Either of you may qualify for our Hero’s Program.

Katherine Taylor

I have a two questions. I am a private school teacher and my husband is law enforcement, so only he would be the one who qualifies. Is he still eligible for DPA if we are jointly on the loan and title?
Also, is the 3 yr time frame for MCC homes in Texas specifically? It’s been about 2.5yr since we sold our home out of state. 

Thank you.

[email protected]

Hi Trinh, TSAHC no longer has purchase price limits for our DPA options! Though due to certain requirements, we do still have purchase price limits for home buyers that are seeking an MCC. If you’d like more information, feel free to reach out to us at .(JavaScript must be enabled to view this email address).

[email protected]

Hi John, you can use our program to help pay for closing costs! Many home buyers direct the TSAHC funds left over from the down payment costs towards closing fees, allowing them to keep more of their own money in savings. If you’re interested in looking for additional home buyer assistance programs, we’d recommend searching for programs from your city government or local housing authorities.

Trinh Le

Hello,

Is there a different purchase limit for multi family? The prices for multi family are much higher than the currently listed limit as it consists of multiple units.

John Hodnett

Apperantly we qualify for the assistance program and I am wondering if you also provide funding for inspections and closing cost.  If not is there another program that we can apply to help in these areas?

[email protected]

Hi Amber, we’d be happy to help you get in contact with the lender that you’re using to participate in TSAHC’s programs.  Please send us an email to .(JavaScript must be enabled to view this email address) so we can help you out!

Amber Pierce

Hello,
I reached out to a loan officer in the end of October 21 and they had me fill out a mortgage application, which I completed on 11/9/21. Since then we’ve been messaging each other through the mortgage site but I cannot get any answers as to whether I can be approved or not and what the next step is. Is this standard procedure for the process to take over 3 months without any substantial communication?

I took a hard inquiry to my credit for this and didn’t use the window to mortgage shop because I’m not going the traditional route, I assumed.

[email protected]

Hi Torrance! Fortunately, we were able to lift that overlay earlier this year. You can always find the most up-to-date procedures here: https://www.tsahc.org/public/upload/files/general/TSAHC_Step_by_Step_Loan_Reservation_Compliance_Procedures.pdf

Torrance Verge

Hello,

has the DTI restriction due to covid been removed for borrowers below 700 credit score?

[email protected]

Hi Maggie, the required amount of down payment changes depending on the type of mortgage loan you desire. They can be as low as 3% for certain conventional loans or 3.5%  for FHA loans.

Maggie

What is the percentage of down payment required for the loan?

[email protected]

Hi Kenneth, we do allow for outside home buyer assistance programs to be used in conjunction with our own! We’d recommend letting your lender know that you’d like to use both, so they can ensure that both programs can be used together without conflict.

Kenneth Edward Magwood

Will you allow grant money to be used as part of my down payment and or closing costs in conjunction with your dpa program?

[email protected]

Hi JD, if you have not owned your primary residence within the past 3 years, you would be considered a first-time home buyer.

[email protected]

Hi JD, we’re happy to hear that you’re working on building up your savings! Many of our home buyers do the same in advance of purchasing a home. To get started on the path to homeownership, we’d recommend taking our Eligibility Quiz to see if you qualify for our programs: https://www.tsahc.org/homebuyers-renters/take-the-eligibility-quiz

JD

If I own an investment property but I’ve never owned a primary residence, would I still qualify as a first time homebuyer?

Brittanie

Hi there! First time home buyer here. I filled out the eligibility forms and it looks like I’m eligible for 2 programs. For the DPA program, am I still eligible for assistance even with 20% down payment? I’m worried about closing costs and trying to avoid paying PMI. Thanks in advance!

JD

Does a home buyer’s savings balance factor in to qualifying for DPA? I plan to buy my first home at the end of the year. By then I’ll have a savings (cash and investments) of ~$10k. Will that reduce the amount of DPA I receive?

[email protected]

Hi Chase, our Homes for Texas Heroes program does require you to purchase a home in Texas with the intent to immediately occupy the home as your primary residence.  However, TSAHC has no requirement that you already be a Texas resident or U.S. citizen.

If you haven’t already completed it, our home buyer eligibility quiz helps you determine whether you qualify for our programs: https://www.tsahc.org/homebuyers-renters/take-the-eligibility-quiz

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