Requirements to Buy a House in Texas: 7 Rules (2026)

If you are renting in Texas and wondering whether your credit, savings, or income are strong enough to qualify for a mortgage, the path to ownership is often much more reachable than you might think.

This guide breaks down the 7 core requirements to buy a house in Texas in 2026, covering credit minimums, down payment rules, debt-to-income ratios, employment documentation, county limits, homebuyer education, and mortgage pre-approval.

Check Your Texas Home Purchase Eligibility

By the end, you will know exactly how lenders evaluate a first time home buyer in Texas and how state programs can help cover your upfront costs.

The 7 Rules at a Glance

Whether you are buying your first starter home or moving up, lenders and state housing agencies look at the same core pieces of your financial profile. Meeting the requirements to buy a house in Texas comes down to seven practical rules:

1. A qualifying credit score: State assistance programs start at a 620 minimum middle credit score, though standard loan programs vary.
2. Down payment and closing funds: You can bring your own savings (such as 3.5% for an FHA loan) or use 2% to 5% in state down payment assistance.
3. A manageable debt-to-income ratio (DTI): Your monthly debt payments must fit comfortably within your gross monthly income.
4. Steady income and clean documentation: Lenders verify your ability to repay through pay stubs, tax transcripts, and employment records.
5. County income and purchase price limits: If you use state assistance or tax credits, your income and home price must fit within published county caps.
6. Homebuyer education: State programs require a pre-purchase homebuyer education course before you close.
7. A formal mortgage pre-approval: A participating lender reviews your file upfront so you can shop with a verified budget.

Rule 1: Meet the Minimum Credit Score for Your Loan Type

Your credit score is one of the first things a lender checks because it determines which mortgage products and Texas first-time homebuyer grants and programs you can use. Different loan types—such as FHA loans in Texas, VA loans in Texas, USDA loans, and conventional loans—set their own baseline credit rules, and individual lenders may apply their own standards on top of those baselines.

If you plan to use down payment assistance from the Texas Department of Housing and Community Affairs (TDHCA) or the Texas State Affordable Housing Corporation (TSAHC), the credit rules are clear and standardized. Both agencies use your middle (determining) credit score.

Notice how the loan type interacts with the state program. If you have a 620 middle score and want to use TSAHC assistance, you can qualify with an FHA, VA, or USDA loan on a site-built home, while a conventional HFA loan or a manufactured home through TSAHC requires a 640 score.

Rule 2: Plan Your Down Payment and Closing Costs (Or Use 2% to 5% Assistance)

You do not need 20% down to buy a home in Texas. Standard mortgage options require far less upfront cash—for example, FHA loans allow as little as 3.5% down, and VA and USDA loans do not require a down payment for eligible borrowers.

Beyond the down payment, every buyer must also plan for closing costs and prepaid items (such as property taxes and homeowners insurance). To help cover both the down payment and closing costs, TDHCA and TSAHC offer 2% to 5% of the total loan amount in down payment assistance (DPA), while funding lasts.

How Texas State Down Payment Assistance Works

State assistance is paired with a 30-year fixed-rate first mortgage. Depending on the agency and daily availability, that help comes as a grant, a 3-year forgivable second lien, or a 30-year deferred second lien:

• TDHCA Assistance (My First Texas Home and My Choice Texas Home): Offers 2% to 5% of the total loan amount as a 0% interest second lien with no required monthly payments. TDHCA has two structures: a 30-Year Deferred Repayable second lien (due in full upon sale, refinance, transfer, or payoff of the first mortgage) and a 3-Year Deferred Forgivable second lien (forgiven after 36 months if you stay current on the first mortgage and occupy the home as your principal residence). Which structure and percentage tiers are available changes day to day—for example, on the October 26, 2026 TDHCA Rate Notice, standalone MFTH bond loans offered only the 30-year deferred lien, while the 3-year forgivable lien appeared under the MFTH + MCC Combo and under My Choice Texas Home.
• TSAHC Assistance (Home Sweet Texas and Homes for Texas Heroes): Offers three structures depending on your loan type:
  • Grant (2%, 3%, 4%, or 5%): Available with FHA, VA, and USDA loans only (not HFA conventional). There is no second lien. According to TSAHC guidelines, the grant does not need to be repaid after six months from the first-lien closing date.
  • 3-Year Deferred Forgivable Second Lien (2%, 3%, 4%, or 5%): Available on all eligible loan types (FHA, VA, USDA, and HFA conventional). It carries 0% interest and no monthly payments, and is forgiven in full on the third anniversary of the Note (not pro-rated) as long as you do not sell, transfer, refinance, pay off the first lien, or stop occupying the home during those three years.
  • Bond 30-Year Deferred Repayable Second Lien (4% or 5%, when available): Available on Bond FHA, VA, and USDA loans for first-time buyers at or below 80% of Area Median Family Income (AMFI). It carries 0% interest and no monthly payments, is not forgivable, and must be repaid upon maturity, sale, transfer, refinance, or payoff.

Both TDHCA and TSAHC also offer a No-DPA option for buyers who have their own down payment funds and simply want a competitive 30-year fixed first mortgage rate. Under TDHCA, extra local gift funds can also stack with eligible loans while funds last: Capital Area HFC offers $7,500 in Bastrop, Blanco, Burnet, Caldwell, Fayette, Lee, and Llano counties and $2,500 in Hays and Williamson counties; Harris County HFC offers $1,000 in eligible parts of Harris County (with MFTH and no-DPA first liens); and McKinney HFC offers $5,000 in the City of McKinney (not available with MCTH).

Program rates and available assistance tiers are set daily by each agency, so a participating lender can quote today's rate and confirm which DPA options are open.

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Rule 3: Keep Your Debt-to-Income Ratio (DTI) in Check

Your debt-to-income ratio (DTI) compares your total monthly debt payments—including your future mortgage principal, interest, property taxes, homeowners insurance, any homeowners association dues, plus student loans, auto loans, and minimum credit card payments—against your gross (pre-tax) monthly income. Lenders use DTI to make sure your new house payment will not stretch your monthly budget too thin.

When you apply for a Texas state homebuyer program, DTI rules depend on whether your loan is approved through an automated underwriting system (AUS) (such as Fannie Mae Desktop Underwriter or Freddie Mac Loan Product Advisor) or requires manual underwriting by a human underwriter:

• With Automated Underwriting (AUS): Both TDHCA and TSAHC follow the AUS findings. TSAHC specifically notes that there is no maximum DTI cap set by the agency when the loan receives an AUS approval.
• With Manual Underwriting: Both TDHCA and TSAHC cap the maximum DTI at 45%.
  • Under TDHCA, manual underwriting is allowed on FHA, VA, and USDA loans (and is not accepted on My Choice Texas Home conventional loans). FHA manually underwritten loans under TDHCA also carry a 0.25% loan-level price adjustment.
  • Under TSAHC, manual underwriting is allowed on FHA loans only (not VA, USDA, or conventional), and requires a 640 minimum credit score alongside the 45.00% maximum DTI.

Keeping credit card balances low and avoiding new auto loans or installment debt in the months leading up to your home purchase is the simplest way to keep your DTI in a comfortable range.

Rule 4: Show Steady Income, Residency, and Clean Documentation

Texas does not set a minimum dollar income to buy a house. Instead, lenders verify that your income is steady, reliable, and sufficient to cover your monthly mortgage payment alongside your other debts.

What Lenders Document

When you apply, your loan officer will collect standard financial paperwork to verify your employment, income, and assets. Furthermore, if you are applying for a first-time buyer program, your documentation also proves your buyer status and residency:

• Income and Employment: Lenders document your qualifying income on the standard loan application (Form 1003). If you are a full-time public K-12 educator, peace officer, fire fighter, EMS worker, corrections officer, nursing or allied health faculty member, or veteran applying for Homes for Texas Heroes eligible professions, your lender will also verify your full-time employment or military service (such as a DD-214 or a Verification of Employment).
• Prior 3 Years of Tax Returns (When Required): To qualify as a first-time homebuyer under TDHCA's My First Texas Home or Mortgage Credit Certificate (MCC), you and any non-purchasing spouse must not have owned and occupied a primary residence in the last 3 years. Lenders verify this using 3 years of tax returns or IRS transcripts showing no mortgage interest or property tax deduction for a primary residence. By contrast, TDHCA's My Choice Texas Home does not require first-time buyer status and does not require tax returns for program compliance.
• First-Time Buyer Waivers: Both TDHCA and TSAHC waive the 3-year first-time buyer rule on bond loans and MCCs if you are purchasing in a Qualified Targeted Census Tract or if you are a qualified veteran (note that under TSAHC rules, active-duty service members are not considered Qualified Veterans for the first-time buyer waiver, though they do qualify for the Homes for Texas Heroes program itself).
• Texas Residency: For TDHCA My First Texas Home, first-time buyers must sign a Texas Residency Affidavit showing a current Texas address (waived for veteran and targeted-area exemptions). For TSAHC Homes for Texas Heroes, borrowers must currently live in Texas or show intent to become residents (such as accepting a job in an eligible profession in Texas). TSAHC's Home Sweet Texas program has no Texas residency requirement.
• Primary Residence Occupancy: For both TDHCA and TSAHC programs, the home must be located in Texas and must become your principal residence within 60 days of closing.

Rule 5: Stay Within County Income and Purchase Price Limits (For State Programs)

If you use a standard FHA, VA, or conventional mortgage without state assistance, these state program income caps do not apply (USDA loans have their own federal income limits). However, if you want to take advantage of TDHCA or TSAHC down payment assistance or a Mortgage Credit Certificate (MCC), your income—and sometimes your home's price—must fall within published limits for your county.

Understanding how Texas homebuyer income and purchase price limits work can help you pick the right program if you earn a higher salary or are shopping in a pricier neighborhood:

• Whose income counts? Under TDHCA My First Texas Home, TDHCA MCC, TSAHC Bond DPA, and TSAHC MCCs, lenders count total household income (everyone on the deed of trust, including a non-purchasing spouse). Under TDHCA My Choice Texas Home and TSAHC Non-Bond DPA or No-DPA (without an MCC), lenders count only the qualifying income of the borrowers on the loan application (Form 1003)—a non-purchasing spouse's income is excluded.
• When do purchase price limits apply? Purchase price limits apply to TDHCA My First Texas Home, TDHCA MCCs, TSAHC Bond DPA, and TSAHC MCCs. There is no purchase price limit on TDHCA My Choice Texas Home or on TSAHC Non-Bond DPA when used without an MCC.

Here is a snapshot of current published 1-unit non-targeted limits across major Texas counties (TDHCA figures effective July 13, 2026; TSAHC figures from the TSAHC County Income Limits tool accessed October 26, 2026). Because limits are updated periodically, always confirm current figures for your county and household size with a participating lender.

Note: Higher income and purchase price limits apply in Qualified Targeted Census Tracts. For conventional loans at or below 80% AMI, lower county-specific income caps apply under both TDHCA and TSAHC. You can also review full Homes for Texas Heroes income limits by county.

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Rule 6: Complete Homebuyer Education (When Using State Programs)

If you use a TDHCA or TSAHC program to buy your home, you must complete a pre-purchase homebuyer education course before closing. Homebuyer education explains the buying and mortgage process so you step into ownership prepared.

Each agency has specific rules for which courses count and who must take them:

• TDHCA Homebuyer Education Rules: Every borrower on the loan must complete a pre-purchase, HUD-certified homebuyer education course (non-occupying co-signers are exempt). Financial-literacy-only courses do not count. TDHCA accepts Finally Home!, Freddie Mac CreditSmart Homebuyer U, Fannie Mae HomeView, or any HUD-certified homebuyer course.
• TSAHC Homebuyer Education Rules: At least one borrower must complete an approved in-person or online homebuyer education course before closing and sign the TSAHC Home Buyer Education Affidavit. In addition, if you use TSAHC's 3-year Deferred Forgivable Second Lien or a Mortgage Credit Certificate, you must watch TSAHC's short education videos for those products.

Rule 7: Get Pre-Approved Through a Participating Lender

The final requirement showing how to buy a house in Texas with confidence is getting a formal mortgage pre-approval before you start making offers. Unlike a quick pre-qualification—which is only a rough estimate based on unverified numbers—a pre-approval means a loan officer has reviewed your credit report and your income and asset documents, and has typically run your file through automated underwriting.

Why Pre-Approval Matters for Texas Buyers

1. You know your true monthly budget: Instead of guessing what price range you can afford, you see how principal, interest, Texas property taxes, homeowners insurance, and mortgage insurance fit together.
2. Your loan officer can match you with state programs: TDHCA and TSAHC do not lend directly to consumers—buyers must apply through an approved participating lender who reserves the loan (and any MCC) in the agency's portal.
3. You can layer tax credits if eligible: Both TDHCA and TSAHC offer a Mortgage Credit Certificate (MCC) for qualified first-time buyers (and eligible veterans or targeted-area buyers) that provides a federal income tax credit equal to 15% of the annual mortgage interest paid each year you occupy the home as your primary residence. At the current published 15% credit rate (confirm with a participating lender), there is no $2,000 annual cap, though the credit cannot exceed your federal income tax liability for the year (unused credit can be carried forward up to 3 years). Under TDHCA, the MCC can be combined with an assisted My First Texas Home loan for a $400 issuance fee (waived for military) or used as a standalone MCC with an outside mortgage ($1,000 issuance fee, waived for the military standalone option, plus $225 compliance fee). Under TSAHC, the standalone MCC is discontinued, so the MCC must be paired with TSAHC Non-Bond DPA or No-DPA; the $400 MCC issuance fee is waived for Homes for Texas Heroes borrowers using Non-Bond DPA plus an MCC.
4. Sellers take your offer seriously: Many listing agents expect to see a pre-approval letter submitted alongside your purchase contract.

Next Steps: Check Your Eligibility Today

Meeting the requirements to buy a house in Texas does not require a 20% down payment or flawless credit. If you have a 620 or higher credit score (640 for some conventional and manufactured-home options), steady verifiable income, and a manageable debt-to-income ratio, you may already meet the guidelines for an FHA, VA, USDA, or conventional loan—plus 2% to 5% in Texas down payment assistance to help cover your upfront cash at closing.

Because state homebuyer programs are offered through participating lenders and daily rates and assistance options change, the smartest first step is a quick eligibility review. Our team at Make Texas Your Home can help you check your eligibility, compare your loan and assistance options side by side, and get connected with a participating lender to start your pre-approval.

Check Your Texas Home Purchase Eligibility