The Housing Authority of the City of Austin offers down payment assistance programs to local residents. To see what kind of Texas down payment programs are offered by Housing Authority of the City of Austin, visit their website: www.hacanet.org.
A Texas Mortgage Credit Certificate or TMCC is issued by the government. It lets a taxpayer claim tax credit for a portion of the mortgage interest that they pay in any given year. This program is designed to make it easier for people who want to buy their first home to qualify for a loan.
Qualifying for the TMCC
If you want to qualify for a Texas Mortgage Credit Certificate, there are several criteria that you must satisfy. These relate to factors such as your income and of course, you must be purchasing a house for the first time. Qualified veterans will also be able to benefit. In some situations the criteria may be waived. For example, if your home is destroyed in a natural disaster, you may receive special consideration as a resident of the zone that you live in.
Home Ownership Criteria
People who already owned a home in the last three years will not be able to benefit from this program. If you owned a home but sold it and did not own one for four years or more you may be able to apply for the program. Special consideration may be given to people who want to purchase a home in a disaster zone.
If you want to receive assistance with purchasing your home under the Texas Mortgage Credit Certificate, your income must meet the criteria that has been set out by the government. Usually, your income must be at or below 80% of the median income. The price of the house that you want to buy must also be below a certain limit.
Use of the Residence
If you are not planning to use the home as a primary residence, you will not qualify under the Texas Mortgage Credit Certificate. Once you qualify, the tax credit may be up to 40% of the annual interest that you would pay on your mortgage. A cap of $2,000 is placed on that each year. You may use the program with any type of mortgage that is offered by lenders.
Curious to see which states have the most down down payment programs? You won’t be surprised by this list:
- New York
Texas down payment assistance programs are available for teachers, lawyers, doctors, first time home buyers and low-income earners. The programs enhance access to down payment assistance grants, mortgage credit facilities and fixed-rate mortgage financing. Lenders who are available all over the region provide the programs. The programs also help to support families to overcome the menace of financial hardships. In most cases, financial hardships among people forces people to live in homes that are not conducive as far as their needs are concerned. Such people are therefore advised to seek services from an agency that provide down payment assistance programs in Texas.
Texas down payment assistance programs are 30-year mortgage loans rates that are fixed. These loans are eligible for home buyers across the region. The interest rates provided are relatively low as compared to other programs available. In addition to low interest rates, the programs also provide grants and at the same time closing costs.
First time home buyers benefit from the provision of a tax credit through the issuance of a mortgage credit certificate. The certificates should be issued without bias or exclusion provided an individual is qualified. Furthermore, a mortgage credit certificate enables the home buyer to acquire part of the interest earned as a special tax credit. This encourages more home buyers to use the services of a down payment program. A mortgage credit certificate save the home buyer the high costs over the life
of the loan.
With down payment assistance programs in place, people in Texas are able to access approved counselling services from agencies that deal with housing. These agencies provide their services for free and therefore becoming advantageous to those people who are faced with financial constraints. Nevertheless, the government should monitor the work of some of the agencies since there are reports of financial exploitation. This is because, down payment assistance programs are meant to be offered free of charge.
Below is a list of Texas Down Payment Assistance Programs:
No Down Payment Mortgages – mortgages that require no down payment
USDA Rural Loan – the purpose of the Single Family Housing Direct Home Loan is to assist low- and very-low-income applicants obtain decent, safe and sanitary housing in eligible rural areas by providing payment assistance to increase an applicant’s repayment ability. There is no down payment. Payment assistance is a type of subsidy that reduces the mortgage payment for a short time. The amount of assistance is determined by the adjusted family income.
VA Home Loan – VA helps Service members, Veterans, and eligible surviving spouses become homeowners. As part of our mission to serve you, we provide a home loan guaranty benefit and other housing-related programs to help you buy, build, repair, retain, or adapt a home for your own personal occupancy. There is no down payment as long as the sales price doesn’t exceed the appraised value.
Low Down Payment Mortgages – mortgages that require up to 3.5% down payment
FHA Mortgage Loan – the purpose of the FHA Home Mortgage Loan is to provide mortgage insurance for a person to purchase or refinance a principal residence. The mortgage loan is funded by a lending institution, such as a mortgage company, bank, savings and loan association and the mortgage is insured by HUD. A down payment of just 3.5 percent is required and may consist entirely from “gift funds.” The credit score requirement is 580.
Home Possible® Advantage Mortgage – the purpose of the Home Possible® Advantage mortgage by Freddie Mac is to offer low down payments for low- to moderate-income homebuyers or buyers in high-cost or underserved communities. Down Payment can come from a variety of sources, including friends and family, employer-assistance programs and secondary financing.
The HomeReady™ Mortgage – the purpose of the HomeReady™ mortgage by Fannie Mae is to provide flexibility for applicants buy home with down payments as low as 3%, below market mortgage rates, co-borrower flexibility, additional income sources and reduced mortgage insurance costs.
Texas Down Payment Assistance Programs
Homes for Heroes This Texas down payment program is designed specifically for allied health faculty member, corrections officer, county jailer, emergency medical services personnel, firefighter, juvenile corrections officer, nursing faculty member, peace officer, professional educator, public security officer and veterans. This is a 30 year, fixed interest mortgage program with Texas down payment assistance of 3 percent, 4 percent or 5 percent that does not need to be repaid. There is no first time buyer requirement.
My First Home Program This Texas down payment program offers a 30 year fixed rate loan with closing cost and Texas down payment assistance equal to 5 percent of loan amount (up to $8,000). This is designed for low income buyers who need additional assistance. First Texas can be combined with the MCC.
The US Department of Housing and Urban Development (HUD) offers the following programs:
The Good Neighbor Next Door Program was created by U.S. Department of Housing and Urban Development (HUD) to help law enforcement officers, pre-Kindergarten through 12th grade teachers, firefighters and emergency medical technicians buy homes. The biggest benefit of the Good Neighbor Next Door Program is the 50% discount of the home’s list price. The only catch is that the home owner must commit to live in the property for 36 months as their sole residence.
To learn more about the Good Neighbor Next Door Program, click here.
The Section 184 Indian Home Loan Guarantee Program is a mortgage for American Indian and Alaska Native families, Alaska villages, tribes, or tribally designated housing entities. In 1992 Congress created this program to help Native American Communities with homeownership.
Section 184 loans helps borrowers buy homes with a low down payment and flexible underwriting. Moreover, the loan does not need to be used only on properties on native lands. Purchase of an existing home for single-family residences. Also allowed are new construction, rehabilitation, and refinance.
To learn more about Section 184, click here.
Texas Housing Agencies
Texas housing agencies are your best resource for down payment assistance programs. Through funding from HUD, the purpose of these agencies is to ensure that affordable housing is available for everyone.
- Beaumont Housing Authority
- Housing Authority of the City of Dallas
- Fort Worth Housing Authority
- Georgetown Housing Authority
- Galveston Housing Authority
- Housing Authority of the City of Austin
- Housing Authority of the City of El Paso
- Housing Authority of Travis County
- Harris County Housing Authority
- Houston Housing Authority
- Montgomery County Housing Authority
- Mount Pleasant Housing Authority
- Nacogdoches Housing Authority
- New Boston Housing Authority
- San Antonio Housing Authority
- Sherman Housing Authority
- Texas Housing Authority
- Kermit Housing Authority
- Public Housing Authorities in Texas
- Temple Housing Authority
- Waco Housing Authority
- Wichita Falls Housing Authority
- Texas Department of Housing and Community Affairs