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Can You Buy A House Without A Down Payment?

Writer's picture: Argentina LeyvaArgentina Leyva

Updated: Nov 13, 2024

How Down Payment Assistance Programs in Texas Can Make Homeownership a Reality


Buy a house with no down payment

For many first-time homebuyers, saving for a down payment is one of the biggest obstacles to owning a home. Rising home prices and other financial obligations can make it challenging to save the typical 20% required for a down payment. However, down payment assistance programs, such as those offered by the Texas State Affordable Housing Corporation (TSAHC), are designed to help low- and moderate-income homebuyers overcome this hurdle. Not only can these programs eliminate or reduce the need for a down payment, but they can also provide valuable tax savings through Mortgage Credit Certificates (MCCs), putting more money back in your pocket each year.


Introduction: The Down Payment Struggle

Buying a home is often seen as a major milestone, but for many people, the challenge of saving for a down payment is daunting. This is especially true for first-time homebuyers, who may be dealing with student loans, rent, and other expenses. The reality is that accumulating 20% of a home’s purchase price can take years, and for some, it may feel impossible.


Thankfully, programs like TSAHC’s Home Sweet Texas and Homes for Texas Heroes are designed to help. By offering down payment assistance and mortgage credit certificates, TSAHC gives qualified buyers a leg up in securing their first home, even if they haven’t saved enough for a down payment.


How TSAHC's Programs Work

TSAHC offers down payment assistance and tax-saving benefits to help buyers overcome financial barriers and invest in homeownership. Here’s a breakdown of how the programs work:


Step 1: Find Out If You’re Eligible

TSAHC provides two primary programs: Home Sweet Texas and Homes for Texas Heroes. While the Home Sweet Texas program is open to low- and moderate-income homebuyers, the Homes for Texas Heroes program is designed specifically for teachers, veterans, police officers, firefighters, and corrections officers. To determine if you qualify, TSAHC offers an easy-to-use Eligibility Quiz, which is the first step toward accessing these benefits.


Step 2: Work with a TSAHC-Approved Lender

Once you’ve determined your eligibility, you’ll need to work with one of TSAHC’s approved lenders. These lenders understand the ins and outs of the program and will guide you through the application process, ensuring that you meet all the requirements and get the most out of the assistance available.


Step 3: Complete Homebuyer Education

Before closing on your home loan, TSAHC requires all participants to complete a homebuyer education course. This ensures that you’re fully prepared for homeownership and understand all aspects of the process. The Texas Financial Toolbox is a great resource for finding quality courses that fit your needs.



Steps to Use TSAHC's Home Buyer Programs


Types of Assistance Available

  1. Down Payment Assistance (DPA)

    • TSAHC offers up to 5% of the loan amount as down payment assistance. This assistance can be provided as either a grant or a deferred forgivable second lien loan (meaning it may not need to be repaid after three years).

    • This allows buyers to cover the cost of the down payment and possibly some closing costs, reducing the financial burden when purchasing a home.

    • This program is unique in that it allows buyers to use the Down Payment Assistance (DPA) not only for the down payment and closing costs but also to cover buyer representation commission fees. This feature sets it apart from other assistance programs, as most typically exclude such costs. By enabling the DPA to be used for these fees, TSAHC’s program further reduces the financial burden on the buyer, making homeownership even more accessible. This flexibility means you can secure expert representation throughout the homebuying process without worrying about out-of-pocket expenses for your agent’s commission.



  2. Mortgage Credit Certificates (MCC)

    • An MCC is a special tax credit that reduces your federal income taxes, making homeownership more affordable year after year.

    • This credit is available only for first-time homebuyers or those who haven’t owned a home in the last three years.

    • MCCs can save you thousands of dollars over the life of the loan and can be combined with TSAHC’s DPA programs.

    • The best part? If you’re a Texas Hero, the MCC is offered for free when used in conjunction with the DPA, saving you an additional $500.


Why Choose TSAHC’s Programs?

  • No Large Down Payment Needed: With up to 5% down payment assistance, you can purchase a home even if you haven’t saved the typical 20%.

  • Tax Savings Every Year: The Mortgage Credit Certificate allows you to save on federal taxes each year, putting more money in your pocket over the life of your loan.

  • Support for Everyday Heroes: TSAHC’s Homes for Texas Heroes program is designed to support those who serve our communities, offering unique benefits for teachers, veterans, and public safety professionals.


Take the Next Step: See If You Qualify

If you’re ready to explore how TSAHC’s down payment assistance and MCC programs can help you buy your first home, the first step is simple. Take the Eligibility Quiz on TSAHC’s website to find out if you qualify. This quick and easy quiz can open the door to valuable financial assistance and tax savings.


Ready to Get Started?

As a participating REALTOR® with TSAHC, I’m here to answer any questions you may have and guide you through the process of securing down payment assistance. If you’re ready to start your journey to homeownership, don’t hesitate to reach out!


Contact Me Today:

Argentina Leyva

Phone: 630-956-8371

Social Media: @argentinaleyvarealtor


Let’s make homeownership a reality for you!

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