texas homebuyer assistance program

Texas HOMEbuyerAssistance Program

Administered by

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Introducing the all new…

Because there’s no place like HOME.

Texas HOMEbuyer Assistance ProgramBecause there’s no place like HOME.

Program Description

Provides up to $20,000 down payment and closing cost assistance

Assistance provided as 0% interest deferred forgivable loan

Serves low income households in the following counties: - Bastrop - Caldwell - Williamson- Blanco - Hays- Burnet - Travis (excluding the City of Austin)

Funded by the US Department of Housing and Urban Development’s (HUD) HOME Investment Partnerships Program (HOME Program)

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Loan RequirementsFixed interest rate

No subprime loan products

VA, FHA, USDA and Conventional acceptable as long as other guidelines are met.

Loan-to-value ratio at or below 100%

Buyer may not receive any cash back at closing

Maximum lender charges and origination fees of $2,500Fees used in conjunction with single family mortgage revenue bond and mortgage credit certificate programs and permanent interest rate buy downs (which are an acceptable use of HOME funds) are excluded from $2,500 calculation

Front-end ratio must be no less than 25%

Back-end ratio must be no greater than 45%

Cannot be used for construction loans 3


Household Eligibility Factors

Household is not required to be a first time homebuyer

Household must complete an eligible homebuyer education course

TDHCA has a suggested list of providers on website

Lender or Realtor may also host a homebuyer education class

Homebuyer must occupy the home as their principal place of residence for the entire loan term

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Household Eligibility Factors – (continued)

This program may include types of income that would be normally be excluded from other programs; e.g., unemployment benefits, child support, periodic deposits from relatives, and sporadic employment income

TDHCA will perform an Income Verification to determine eligibility

TDHCA will verify front and back end ratios to ensure accuracy

Entire household income (including income from non-borrowing parties) cannot exceed 80% Area Median Income for the county in which the new home is located

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Household Eligibility FactorsIncome Limits by Household Size by County

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County 1 Person 2 Persons 3 Persons 4 Persons 5 Persons 6 Persons

Bastrop $41,950 $47,950 $53,950 $59,900 $64,700 $69,500

Blanco $34,100 $39,000 $43,850 $48,700 $52,600 $56,500

Burnet $32,600 $37,250 $41,900 $46,550 $50,300 $54,000

Caldwell $41,950 $47,950 $53,950 $59,900 $64,700 $69,500

Hays $41,950 $47,950 $53,950 $59,900 $64,700 $69,500

Travis $41,950 $47,950 $53,950 $59,900 $64,700 $69,500

Williamson $41,950 $47,950 $53,950 $59,900 $64,700 $69,500

Property RequirementsProperty must be a single family home (including new manufactured housing) or condominium unit

Property must pass a Housing Quality Standards (HQS) inspection conducted by TDHCA

HQS has different requirements than a Texas Real Estate Commission (TREC) inspection

Property must be environmentally reviewed and cleared by TDHCA

Property must be located in the participating service area

Property value may not exceed the Section 203(b) mortgage limits (pre-Economic Stimulus Act) established by HUD for the applicable county:

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Bastrop Blanco Burnet Caldwell Hays Travis Williamson

$218,595 $200,160 $200,160 $218,595 $218,595 $218,595 $218,595

Lender Role and Responsibilities

Household Application intake1003 Texas HOMEbuyer Supplemental ApplicationTexas HOMEbuyer Loan Calculator

Generation of the TIL and GFE

Collection of documents from household

Provide documents to TDHCA’s HOME Division

Approval and provision of suitable first lien mortgage

Provision of preliminary HUD-1 to TDHCA at least 10 business days before loan closing

Upon discretion of TDHCA, additional documentation may be requested to verify household and property eligibility

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TDHCA Role and Responsibilities

Household income qualification for the Texas HOMEbuyer Assistance Program

Perform Housing Quality Standards (HQS) inspections

Perform environmental review

Provide Texas HOMEbuyer Assistance Program loan funds at time of closing

Service the Texas HOMEbuyer Assistance Program loan

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Household Role and Responsibilities

Provide all documents required by TDHCA in a timely manner to the lender

Certify accuracy of documents provided

Complete an approved homebuyer education course

TDHCA has a suggested list of providers on website

Lender or Realtor may also host a homebuyer education class

Fulfill obligations of loan term, or make arrangements with TDHCA for repayment

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Assistance Amount DeterminationTexas HOMEbuyer Assistance Program funds may be used for downpayment and closing costs.

Front-end ratio must be equal to or greater than 25% of gross household income, based on:

30 year mortgage at the applicable percentage rate, andTDHCA’s income determination method

Back-end ratio cannot exceed 45% of gross household monthly income

The total amount of assistance provided by the Texas HOMEbuyer Assistance Program may not exceed $20,000 per household

The assisted household may not receive any cash back at closing

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Assistance Amount Example

Determine minimum monthly housing contribution (PITI) from family

Gross monthly income x 25%, or($30,000/12) x 25% = $625 monthly PITI

If monthly PITI…

Does not exceed $625, household is not eligible for assistance through the Texas HOMEbuyer Assistance Program

Exceeds $625, down payment assistance may be provided, but total assistance will be limited to a maximum of :

The amount needed to reduce monthly PITI to $625 plus closing costs assistance, or$20,000

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Process Timeline

Lender identifies potential assistance recipient

Lender contacts the Texas HOMEbuyer Assistance Program at [email protected]

Lender submits the following to TDHCA to refer the household:1003Texas HOMEbuyer Loan CalculatorTexas HOMEbuyer Supplemental Application

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mailto:[email protected]

Process Timeline (continued)Lender submits the following to TDHCA to refer the household (continued):

Household verification documentsConsecutive paystubs for most recent 3 months for each full-time and part-time job, for all household membersBank statement(s) & asset verifications for all accounts for all household membersTILGFEExecuted Sales Contract

**Please note that property does not need to be identified at this time**

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Process Timeline (continued)

If there is child support for any household member (debt or income), a copy of

Divorce Decree

Child support agreement or other documentation of payments

Most recent evidence of social security, VA, and/or disability benefits for all household members

Information on the liabilities of all household members (i.e., credit card payments, loan payments, etc.)

TDHCA reviews application submission & issues pre-approval, denial, or deficiency letter within 10 days

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After the household is pre-approved, TDHCA will complete the following for household signature:

Household Income Certification (HIC)

Revised Texas HOMEbuyer Loan Calculator, if applicable


After the previously-referenced information has been submitted to TDHCA, TDHCA staff will:

Conduct environmental review

Issue HOME Commitment Contract for borrower’s signature

Schedule HQS inspection after property has been environmentally cleared

Once executed HOME Commitment Contract has been received by TDHCA and property passes HQS inspection, TDHCA will notify lender

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Lender forwards the following documents to TDHCA for closing:

Preliminary Settlement Statement (HUD-1)

Title Commitment (dated within the past 90 days)

First lien commitment letter or underwriting approval

Certificate of completion for homebuyer education course

Copy of property appraisal

Copy of Tax & HOA Certificates

Copy of final 1003 or Certification of no changes, executed by the household

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Lender forwards the following documents to TDHCA for closing (continued):

Evidence of flood insurance (if applicable)

Table funding request documents (samples to be provided)

Subject to TDHCA review and approval of documents…

Texas HOMEbuyer Assistance Program Loan closes in conjunction with first lien & household moves in!

AVERAGE TOTAL PROCESSING TIMEFRAME IS 30-45 DAYS

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Texas HOMEbuyerAssistance Program

Administered by

For More InformationContact TDHCA’s HOME Division

Direct: 512-463-8921 Toll Free: 800-525-0657Questions: [email protected]

Visit the HOME Division online at:www.tdhca.state.tx.us/home-division

Because there’s no place like HOME.

mailto:[email protected]

texas homebuyer assistance program

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