Texas DPA + FHA Loan: How the Pairing Works
Most first-time Texas buyers pair down payment assistance with an FHA loan. FHA needs 3.5% down, and TDHCA or TSAHC assistance can cover it. Here is how the two fit together.
Why FHA is the common Texas pairing
FHA is the workhorse loan for first-time Texas buyers, because it allows a 3.5% down payment and is more forgiving on credit than conventional financing. Both TDHCA and TSAHC are built to sit on top of an FHA first mortgage, so the 2% to 5% assistance covers that 3.5% down payment and much of the closing costs. A buyer with a 620 score can get into a Houston, San Antonio, or El Paso home without draining savings.
How the FHA loan and the DPA second stack
Two loans work together. The FHA first mortgage is your primary loan, with its usual mortgage insurance. The Texas DPA second, from TDHCA or TSAHC, funds the down payment and closing costs at the table, and because it is deferred at zero percent, it adds no monthly payment. Choose the forgivable version and it disappears after three years; choose the repayable version and it is due when you sell or refinance. With TSAHC you can also take the help as a grant. The FHA loan behaves like any FHA loan.
Who this fits
The FHA pairing fits most first-time Texas buyers, especially in the state’s more affordable metros where the 2% to 5% assistance covers the full down payment. If you are a teacher, first responder, veteran, or nurse, TSAHC’s Homes for Texas Heroes gives you higher income limits on the same FHA loan. Veterans should also compare the VA pairing, which needs no down payment at all.
Program facts verified August 2026 against TDHCA, TSAHC, and HUD FHA guidance. This is not a commitment to lend. Related: DPA + VA · County limits.
Common questions
Can Texas down payment assistance cover an FHA down payment?
Yes. FHA requires a 3.5% minimum down payment, and TDHCA or TSAHC assistance (2% to 5% of the loan) can cover that plus most closing costs. The assistance is a 0% deferred second with no monthly payment; TSAHC also offers a grant.
What credit score do I need for an FHA loan with Texas DPA?
Both TDHCA and TSAHC require a 620 minimum credit score, or 640 on FHA manual underwriting. The assistance pairs with FHA, VA, USDA, or conventional first mortgages.
Do I make a payment on the Texas DPA second with an FHA loan?
No monthly payment. The Texas DPA second is a 0% deferred lien, so it adds nothing to your monthly cost. It is either forgiven after three years or repaid when you sell or refinance the FHA loan.
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