If you are buying a home in Houston and worried about the down payment, you may be sitting closer to homeownership than you think. The Texas State Affordable Housing Corporation (TSAHC) offers down payment assistance programs that provide real money, up to 5% of your loan amount, as either a grant you never repay or a forgivable loan that disappears after three years.
As a TSAHC-participating lender in Houston, Kris Syevens at Aravian Financial processes these programs directly. One application. One closing. Significantly less cash out of pocket.
What is TSAHC?
The Texas State Affordable Housing Corporation is a nonprofit created by the Texas Legislature in 1994. Its mission is to help low and moderate-income Texans achieve homeownership by pairing affordable first mortgages with down payment and closing cost assistance.
TSAHC administers two main programs for home buyers:
- Homes for Texas Heroes — for teachers, first responders, veterans, nurses, and other eligible professionals
- Home Sweet Texas — for any Texas buyer who meets income and credit requirements
Both programs provide a 30-year fixed-rate mortgage paired with 2%, 3%, 4%, or 5% in down payment assistance. You choose the level that covers your needs.
Grant vs Forgivable Loan — What Is the Difference?
TSAHC offers down payment assistance in two structures:
Grant (non-repayable)
The grant option is available when you pair TSAHC with a government-backed loan (FHA, VA, or USDA). As long as your first mortgage is not paid off in the first six months, the grant never needs to be repaid under any circumstances. It is a gift toward your purchase.
Deferred Forgivable Second Lien
The forgivable second lien is available with both government and conventional first mortgages. It carries a 0% interest rate and requires no monthly payments. On the third anniversary of your closing date, it is forgiven in full. However, if you sell, refinance, or transfer the property before three years, the full amount must be repaid at that time.
How Much Can You Get?
TSAHC provides 2%, 3%, 4%, or 5% of the first mortgage loan amount. You choose the level at application. Here is what that looks like at common Houston price points:
- $300,000 loan at 3% = $9,000
- $300,000 loan at 5% = $15,000
- $400,000 loan at 3% = $12,000
- $400,000 loan at 5% = $20,000
These funds can cover your down payment, closing costs, prepaid items, or any combination. For many Houston buyers, a 5% TSAHC grant effectively eliminates the out-of-pocket cost of buying a home.
Who Qualifies?
TSAHC has two sets of requirements: one for the Homes for Texas Heroes program and a broader set for Home Sweet Texas.
Homes for Texas Heroes (profession-based)
- Pre-K through 12th grade teachers, school librarians, school counselors
- Fire fighters, EMS personnel
- Police officers, sheriffs, correctional officers
- Veterans and active-duty military
- Licensed nurses and nursing faculty
Home Sweet Texas (all eligible buyers)
- Any Texas buyer meeting income and credit requirements
- Primary residence only
- Minimum credit score of 620
- Income within TSAHC limits for your county and household size
Income Limits (2026)
For most Houston area counties, TSAHC income limits in 2026 are approximately $108,540 for households of 1-2 people and $126,630 for households of 3 or more. Heroes program participants may have slightly higher limits. Kris can confirm the exact limit for your county before you apply.
The Mortgage Credit Certificate (MCC)
First-time buyers using TSAHC can also layer a Mortgage Credit Certificate (MCC) on top of the down payment assistance. An MCC is a federal tax credit equal to 20% of the mortgage interest you pay each year, for the life of the loan.
On a $350,000 loan at 6.5%, annual interest in year one is approximately $22,400. An MCC gives you a federal tax credit of $4,480 that year. Unlike a deduction, this is a dollar-for-dollar reduction in your tax liability. Over a 30-year loan, the cumulative value is significant.
How to Apply in Houston
The process is straightforward when you work with a TSAHC-participating lender like Aravian Financial:
- Pre-qualify with Kris to confirm TSAHC eligibility and get your rate options
- Complete the required homebuyer education course (online, typically 6-8 hours)
- Select your assistance level (2%, 3%, 4%, or 5%) and DPA structure (grant or forgivable)
- Submit your mortgage application — Kris handles the TSAHC layer simultaneously
- Close at a title company in Houston with both the first mortgage and TSAHC assistance processed together
There is no separate TSAHC application. Everything runs through your mortgage lender. This is why choosing a participating lender matters.