Aug 30, 2022
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Home values have been rising throughout Texas and are up 22.1% from a year ago. According to Zillow’s Home Value Index (ZHVI), the typical value of a single-family home in Texas is currently $315,235.
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Mortgages in Texas
The Texas Department of Housing and Community Affairs (TDHCA) created the Texas Homebuyer Program to help low- to moderate-income people find affordable housing. To that end, you’ll have to fall at or below certain income requirements as well as the organization’s purchase price limits.
Alongside your TDHCA mortgage loan, you’ll also receive a 0% interest second loan to help you cover the upfront costs of buying a home. You only have to pay it back when you sell, refinance or pay off your mortgage.
TDHCA doesn’t actually grant loans and assistance directly. Instead, you’ll work with one of the department’s [participating mortgage lenders to secure approval for a loan as well as access to down payment and closing cost assistance and a federal tax credit.
More: Get a free credit score and credit monitoring from Credit Sesame.
My First Texas Home Loan
This program is open to first-time homebuyers and qualified veterans. Alongside your low-interest, 30-year mortgage, you’ll get a second loan to help with your down payment and closing costs.
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That second loan has a 0% interest rate and will be worth between 2% and 5% of your mortgage, depending on your needs.
To qualify, you’ll need to have a minimum credit score of 620 and meet the TDHCA’s income and purchase price limits.
More: Use these savings accounts to build up your down payment.
Texas Mortgage Credit Certificate Program
A Mortgage Credit Certificate (MCC) is a dollar-for-dollar reduction of the amount you owe on your federal income taxes. The reduction will be a percentage of the interest you pay on your mortgage.
You can use the MCC in combination with your My First Texas Home Loan or as a stand-alone benefit. However, even if you’re not using the other program, you will still have to meet the TDHCA’s income and purchase price limits to get the credit. It’s also limited to first-time homebuyers and veterans.
You can apply for the MCC through one of TDHCA’s participating lenders.
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Sigrid is a senior associate editor on the Moneywise team, where she has also worked as a reporter and staff writer.
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