Down payment assistance can help an eligible buyer cover part of the down payment, closing costs, or both. It can also change the first-mortgage rate, fees, future refinance options, and the amount owed when the home is sold.

Quick answer: Down payment assistance is not always free money. It may be a grant, a forgivable second mortgage, a deferred second mortgage, or a loan with monthly payments. Compare the complete transaction, including the first-mortgage pricing and repayment triggers, before choosing a program.

How down payment assistance works

Most assistance is paired with an approved first mortgage. The program may set the first mortgage rate, approved loan types, income limits, credit standards, homebuyer education, occupancy requirements, purchase-price limits, and repayment terms.

Common structures include:

Grant

A true grant generally does not require repayment if all program conditions are satisfied. Confirm that the assistance is legally a grant and ask whether taxes, recapture, or other conditions apply.

Forgivable second mortgage

The assistance is recorded as a second lien and forgiven according to a schedule. Selling, refinancing, transferring the home, or moving out before the forgiveness period ends may make some or all of the balance due.

Deferred second mortgage

Monthly payments may not be required, but the balance remains owed. Repayment is commonly triggered by sale, refinance, transfer, payoff, or the end of the term.

Repayable second mortgage

The borrower makes payments in addition to the first mortgage. This payment may affect the debt-to-income ratio and affordability.

What assistance does not eliminate

Even when a program covers the required down payment, buyers may still need funds for earnest money, inspections, appraisal, prepaid taxes and insurance, reserves, moving, and repairs. Some costs can be reimbursed or credited at closing, but buyers should not assume the transaction requires zero cash.

Want to know which programs may fit before you plan around the money? Rachael can screen the state, property area, household information, credit profile, loan type, and timeline against current program rules. Check My Assistance Options or call or text 832-438-5626.

Texas down payment assistance

Texas buyers may encounter statewide and local programs. Availability, rates, and matrices can change during the year.

My First Texas Home

The Texas Department of Housing and Community Affairs publishes current program matrices for My First Texas Home. Its current 2026 program materials list FHA, VA, and USDA first mortgages, a 620 minimum middle credit score, income and purchase-price limits, required homebuyer education, and 2 percent to 5 percent assistance when the applicable option and funding are available.

The matrix offers two assistance structures:

• A 30-year deferred, repayable second lien at 0 percent interest with no required monthly payment
• A three-year deferred, forgivable second lien at 0 percent interest, subject to the stated occupancy, payment, and payoff conditions

My First Texas Home generally applies a first-time buyer requirement, with listed exceptions for qualified veterans and properties in qualified targeted census tracts. The property must be in Texas and used as the principal residence.

TSAHC programs

The Texas State Affordable Housing Corporation offers homebuyer programs through participating lenders. Its offerings have included Home Sweet Texas and Homes for Texas Heroes. Eligibility and available assistance depend on the current program, occupation when relevant, income, credit, property, loan type, and funding.

Local Texas programs

Cities, counties, housing finance corporations, and nonprofit partners may offer separate assistance. Geographic boundaries matter. A League City address can fall in Galveston County or Harris County, and a program may exclude specific cities or require the property to sit within a defined service area. Verify the exact street address before relying on local funds.

Louisiana down payment assistance

The Louisiana Housing Corporation offers several homebuyer assistance programs through approved lenders.

Premier GNMA and current availability

LHC's May 13, 2026 Premier GNMA guidelines list soft-second options equal to 0 percent, 3 percent, or 4 percent of the final loan amount. When assistance is reserved, the guidelines describe a zero-interest second lien that is forgiven over three years while the borrower occupies the property as a primary residence. A sale or refinance during the three-year compliance period can make the remaining balance due.

Those guidelines also list FHA, VA, and Rural Development first mortgages, a $99,000 household income ceiling for that program version, minimum credit standards, homebuyer education for eligible first-time buyers, and statewide parish eligibility.

Program guidelines do not prove that every assistance option is available on a given day. On September 8, 2026, LHC's live daily-rate page displayed the Premier Government option with 0 percent down payment and closing-cost assistance. Borrowers should not plan around 3 percent or 4 percent Premier assistance until an approved lender confirms the current rate, assistance option, funding availability, and reservation terms.

MRB Home and MRB Assisted

LHC states that its MRB Home program can provide down payment and closing-cost assistance ranging from 5 percent to 9 percent depending on the loan amount for qualifying buyers at or below the applicable income threshold. Its MRB Assisted program lists a soft second equal to 4 percent of the mortgage amount. Both have program-specific first-time buyer, income, credit, property, and purchase-price rules.

Florida down payment assistance

Florida Housing Finance Corporation provides first-mortgage and second-mortgage options through participating lenders. Current offerings, funding, and terms can change, so buyers should use the current Homebuyer Loan Program materials instead of an old social-media graphic or cached rate sheet.

Florida buyers may see programs such as Florida Assist, the Florida Homeownership Loan Program, and Hometown Heroes. These programs can differ in eligible occupations, first-time buyer rules, income and purchase-price limits, repayment terms, assistance caps, and funding availability.

Local governments also administer assistance through programs such as the State Housing Initiatives Partnership. Local rules may be narrower than the statewide program and can depend on the county or city where the home is located.

How to compare two assistance offers

Ask the loan officer to price the assisted loan and an unassisted alternative side by side. Compare:

• Interest rate and APR on the first mortgage
• Assistance amount
• Required borrower contribution
• Origination, discount, compliance, and program fees
• Monthly principal, interest, taxes, insurance, mortgage insurance, and second-lien payment
• Forgiveness schedule
• Balance due after one, three, five, or ten years
• Effect of selling or refinancing
• Homebuyer education and occupancy rules
• Cash left in savings after closing
• Total cost over the period you realistically expect to own the home

A buyer should not accept $15,000 of assistance without understanding whether the first-mortgage pricing costs more over time or whether the full $15,000 becomes due after an early refinance.

Hypothetical example: More assistance is not always the better deal

Buyer A can choose a larger assistance amount paired with a higher first-mortgage cost or use less assistance and contribute more cash. The larger assistance preserves savings today, but it may cost more each month or leave a second-lien balance due after an early sale or refinance.

The right comparison shows the cash needed now, complete monthly payment, first-mortgage costs, second-lien balance over time, and savings left after closing. The best answer depends on how long the buyer expects to own the home and how much cash must remain available for emergencies.

Who usually qualifies?

Programs commonly review:

• Household or qualifying income
• Purchase price
• Credit score
• Debt-to-income ratio
• First-time buyer status
• Property location and type
• Owner-occupancy
• Completion of approved homebuyer education
• Use of an approved lender and first-mortgage product
• Availability of program funds at reservation

Meeting the public eligibility summary does not guarantee mortgage approval or a fund reservation.

Frequently asked questions

Is down payment assistance free money?

Sometimes it is a grant, but much assistance is a second mortgage with forgiveness or deferred repayment conditions. Read the note, deed of trust, disclosure, and program terms before closing.

Can repeat buyers qualify?

Some programs allow repeat buyers. Others define a first-time buyer as someone who has not owned and occupied a primary residence during the prior three years. Exceptions may apply. Eligibility is program-specific.

Can assistance be used with FHA, VA, USDA, or conventional loans?

Many programs pair with one or more of those first-mortgage types, but not every combination is available. The current program matrix and lender participation determine the options.

Can I refinance after using assistance?

You can refinance when lender, lien, equity, and program requirements are met, but refinancing may trigger repayment of an unforgiven or deferred second mortgage. Include that payoff in the refinance analysis.

Does assistance make an offer weaker?

It can add program steps, deadlines, or documentation, but a prepared buyer and experienced team can address those issues before the offer. Ask how funds are reserved, how long approval takes, and whether the contract timeline is realistic.

Find the program that improves the whole deal

The largest assistance amount is not automatically the best mortgage. Rachael can compare available assistance with standard financing so you can see the cash saved now, the complete payment, and any obligation you may carry later.

What you will review: potential eligibility, assistance structure, first-mortgage pricing, repayment triggers, estimated cash-to-close, and an unassisted alternative when available.

Check My Assistance Options or call or text Rachael at 832-438-5626.

Educational disclaimer: Program terms, funding, rates, limits, and participating lenders can change without notice. This article does not reserve assistance, guarantee eligibility, or commit any lender or agency to make a loan.