Texas First-Time Home Buyer Programs: A Plain-English Guide for Central Texas
Buying your first home is a big step, and in Texas you don't have to figure it out alone. There are loan programs, state-backed assistance options, and local resources designed to help first-time buyers get into a home sooner than they might expect.
I'm Taylor Ring, a Mortgage Loan Officer with Fairway Independent Mortgage (The Wood Group). I help buyers across Central Texas, including Temple, Belton, Killeen, Waco, Salado, Georgetown, Round Rock, Cedar Park, and Leander, sort through their options and pick the one that fits their budget and goals.
What Counts as a "First-Time Home Buyer" in Texas?
Many people are surprised to learn that "first-time buyer" doesn't always mean you've never owned a home. Many programs define a first-time buyer as someone who hasn't owned their primary residence within a certain look-back period; for TDHCA's My First Texas Home, that means you haven't owned and occupied a primary residence in the last three years. Some programs also make exceptions for certain groups, such as veterans, or for homes in specific targeted areas; TDHCA, for example, offers exceptions for qualified veterans and homes in targeted areas.
Because each program sets its own definition, the best first step is a quick conversation to see which ones you may be eligible for.
The Main Types of First-Time Home Buyer Programs in Texas
Think of your options in two layers: the loan itself and any assistance layered on top of it.
Low-Down-Payment Loan Programs
These are the mortgage types most first-time buyers start with:
FHA Loans
Backed by the Federal Housing Administration, FHA loans are often a good fit for buyers with modest savings or credit that's still being built. Minimum down payment and credit requirements apply.
Conventional Loans
Some conventional programs allow a low down payment for qualified first-time buyers. Private mortgage insurance usually applies when you put down less than a certain amount.
VA Loans
For eligible veterans, service members, and some surviving spouses, VA loans may allow purchasing with no down payment. With Fort Hood (formerly Fort Cavazos) right here in Bell and Coryell counties, these are a big part of what I do.
See my VA loans in Texas guideUSDA Loans
For eligible homes in qualifying rural and some suburban areas, USDA loans may allow no down payment for income-eligible households.
See my USDA home loans in Texas guideStatewide Assistance Programs
Texas has two main statewide sources of first-time buyer help:
TDHCA — My First Texas Home
TDHCA's My First Texas Home program pairs a 30-year fixed-rate mortgage with down payment and closing cost assistance for eligible buyers. It's offered through participating lenders, and income and purchase price limits apply. Assistance of up to 5% of the mortgage loan is offered as a 0% second lien, either 30-year deferred repayable or 3-year deferred forgivable. Limits vary by county and household size; we'll check yours.
TDHCATSAHC — Homes for Texas Heroes & Home Sweet Texas
TSAHC offers home buyer programs that can include down payment assistance, as well as options for certain professions that serve their communities. Its programs are Homes for Texas Heroes (for eligible teachers, police, firefighters and EMS, veterans and active military, corrections officers, and nursing and allied health faculty) and Home Sweet Texas.
TSAHCMortgage Credit Certificate (MCC): Both agencies may also offer a Mortgage Credit Certificate (MCC), which may reduce your federal income tax liability for eligible buyers. Supplies are limited, so ask about availability, and talk with a tax professional about how it applies to you.
To dig deeper, read my guides to down payment assistance in Texas and first-time home buyer grants in Texas.
Local and City Programs
Some cities, counties, and housing nonprofits run their own home buyer assistance. Availability changes often and funding can run out. I keep an eye on what's open in Central Texas so you don't have to.
Texas First-Time Home Buyer Qualifications: What Lenders Look At
Every program has its own rules, but most look at the same core areas.
Credit
Your credit history helps determine which programs you qualify for and what terms you're offered. Minimums vary by loan type and assistance program. A score that doesn't work for one program might still work for another.
Income and Debt
Lenders review your income stability and your debt-to-income ratio (how much of your monthly income goes toward debts). Many assistance programs also set maximum household income limits, so earning too much can be a factor too; those limits vary by county and household size, and we'll check yours.
Down Payment and Cash to Close
Beyond the down payment, you'll need to plan for closing costs and any required reserves. Assistance programs, seller credits, and gift funds can help, depending on the loan and program guidelines.
The Home Itself
Some programs have purchase price limits, location requirements, or property condition standards. Most require the home to be your primary residence.
Homebuyer Education
Many assistance programs require a homebuyer education course before closing; My First Texas Home, for example, requires a HUD-certified homebuyer education course for all borrowers. It's a worthwhile course even when it's not required.
Central Texas Examples
"Is My Credit Too Low?"
A buyer in Waco assumed their credit score ruled them out. Instead of stopping there, we reviewed their full profile: income, debts, savings, and credit history. Different programs have different minimums, so we compared which options might fit. If they weren't quite ready, the plan was to build a simple credit improvement roadmap so they'd know exactly what to work on before applying again.
Illustrative scenario, not an actual client transaction. Credit and underwriting requirements vary.
Keeping Some Savings in the Bank
A buyer in Temple had savings but didn't want to drain them on a down payment. We compared low-down-payment loan options, possible assistance, and seller credits side by side, looking at the monthly payment, interest rate, cash needed to close, and any repayment terms. The goal was to find a balance that kept a healthy cushion for life after move-in day.
Illustrative scenario, not an actual client transaction. Seller credits are subject to negotiation and loan guidelines.
How to Get Started: 5 Simple Steps
Check your credit and gather documents. Recent pay stubs, W-2s or tax returns, and bank statements are a good start.
Talk to a local loan officer. We'll review your goals and which programs may fit.
Get pre-approved. A pre-approval shows sellers you're serious and helps you shop in the right price range.
Complete homebuyer education if your program requires it.
Shop for your home with a real estate agent who knows your target area.
Why Work With a Local Loan Officer?
Programs change and funding windows open and close. I know Central Texas from Waco down to Leander, and I'll explain the trade-offs in plain English so you can decide with confidence.
Let's map out your options together.
Frequently Asked Questions
Questions Texas first-time buyers ask us.
Your first home may be closer than you think.
Taylor Ring, Mortgage Loan Officer, NMLS# 2809683 | Fairway Independent Mortgage Corporation, NMLS# 2289 | 127 Lake Rd Ste 300, Belton, TX 76513