Buyers entering the Houston real estate market can choose from several homebuyer assistance programs depending on their needs and eligibility. Take one step closer to homeownership with these programs.
Houston Homebuyer Assistance Program
The City of Houston provides assistance of up to $30,000 to first-time homebuyers through the Housing and Community Development Department. This is a forgivable, no-interest loan secured by a lien. You will be required to make a minimum $350 down payment for the home and there are no additional fees. There is no maximum sale price for a home, giving you the freedom to select any home that fits your needs and budget.
The assistance can be used for your down payment, closing costs, and any prepaid items such as homeowner’s insurance, property taxes, or mortgage interest. It can also cover the principal amount of your first mortgage payment.
The loan is considered fulfilled if you live in the home for five years. If you decide to sell or vacate the home before the five-year period is over, you will be asked to pay a portion of the original loan amount.
You may be eligible for the Houston Homebuyer Assistance Program if you meet the following criteria:
- You’re a first-time homebuyer, or you haven’t owned a home in the last three years
- Your household income is at 80% of Area Median Income (AMI) or lower
- The home you intend to purchase is taxable by the City of Houston
If there are no external delays, the loan application process takes about six weeks from the time you submit a complete application. The application process typically involve the following steps:
- Obtaining a loan through a mortgage lender
- Obtaining a homebuyer education class certificate through a HUD-Approved Agency
- Calling 832.394.6200 to determine if you are eligible and to complete your application
- Finding a suitable home that is taxed by the City of Houston
- Passing a home inspection, environmental review, and underwriting review
- Signing the terms and conditions disclosure
- Closing the sale
Harvey Homebuyer Assistance Program
Houston also offers up to $30,000 to eligible residents who need to replace a home that has been damaged by Hurricane Harvey. This is a forgivable, no-interest loan secured by a lien. To qualify for assistance, you must meet the following criteria:
- You are either a U.S. citizen or legal permanent resident
- You lived in Houston, Texas during Hurricane Harvey (August 2017)
- You lost a home to Hurricane Harvey
- You are willing to complete an eight-hour homebuyer education course
- You are qualified to obtain a fixed-rate mortgage from a lender
- Your household income is at or below the 120% AMI
- You are not a registered sex offender
Your loan is fulfilled if you live in the home for five years. If you sell or move out before the end of five years, you must pay back a portion of the original loan amount. You must also maintain homeowner’s insurance and flood insurance for the home during this five-year period.
Houston Area Home Down Payment Assistance
The Texas State Affordable Housing Corporation (TSAHC) is a nonprofit organization dedicated to helping buyers purchase a home throughout the state of Texas. TSAHC offers two homebuyer programs, which have similar assistance options, but are aimed at different kinds of homebuyers.
The Homes for Texas Heroes Program is a home loan program for the following professionals:
- Educators working in full-time positions in a public school district (i.e. school teachers, aides, counselors, librarians, and nurses)
- Nursing faculty and allied health faculty
- Veterans or active military
- Police officers and public security officers
- Correction officers and juvenile corrections officers
- Firefighters and EMS personnel
The Home Sweet Texas Loan Program offers the same benefits as the Home for Texas Heroes for homebuyers in other professions. If you’re buying your first home, you may be eligible for a Mortgage Credit Certificate (MCC) or a mortgage interest tax credit. To qualify for an MCC, you must meet certain income requirements. The home you purchase must also meet certain sales price restrictions.
To qualify for down payment assistance, you must have a credit score of 620. TSAHC will provide you with a mortgage loan and funding for your down payment. The organization may also offer down payment assistance (DPA) as a grant, which does not have to be repaid, or a deferred and forgivable second lien loan, which only needs to be repaid if you sell or refinance within three years.
Houston Neighborhoodlift Down Payment Assistance Program
NeighborhoodLIFT povides homebuyer education and $15,000 for down payment and closing cost assistance on eligible properties. This program is not limited to first-time homebuyers in Houston. You may be eligible for assistance if you meet the following criteria:
- Your combined annual income is $72,640 or below
- The property you intend to purchase is located within Houston city limits
- The property will serve as your primary, owner-occupied home
- The property is a single-family home (detached or attached), townhome, condo, two to four-unit home, co-op, PUD, land trust, or manufactured home
To apply for assistance with NeighborhoodLIFT, you must complete the following steps:
- Finish eight hours of homebuyer education from an eligible agency
- Get a mortgage pre-approval from an approved lender
- Meet the income requirements for the program
Work with a Houston real estate professional
These programs bring the dream of homeownership within reach of many Houston residents. To learn more about assistance in Houston, reach out to a real estate professional who has worked with eligible homebuyers in the past. They will help you determine which programs best meet your needs and eligibility.
