Hey there! Navigating the home-buying process can feel overwhelming, especially when it comes to financing. But don’t worry—I’m here to help you understand a fantastic opportunity that might make your journey to homeownership a bit smoother.

What is the Hill Country Home Down Payment Assistance Program?

The Travis County Housing Finance Corporation offers the Hill Country Home Down Payment Assistance (DPA) Program to help individuals and families purchase homes within Travis County, including the City of Austin. This program provides financial assistance to cover down payment and closing costs, making homeownership more accessible.

For more information, visit: Travis County Housing Finance Corporation.

Source of Funding

This initiative is funded by the Travis County Housing Finance Corporation, a public entity dedicated to supporting affordable housing solutions within the county.

Eligibility Criteria

• Credit Score and Debt-to-Income Ratio: Minimum FICO score of 660 for FHA loans and 640 for Freddie Mac loans. The maximum debt-to-income ratio is 45% for certain cases and 50% for others.
• Income Limits: Maximum qualifying income is $138,460 for FHA, VA, and USDA-RD loans. For Freddie Mac HFA Advantage loans, the limit is $97,840.
• Homebuyer Education: First-time homebuyers must complete a HUD-approved homebuyer education course.
• Property Requirements: The home must be within Travis County, including the City of Austin, and must be a primary residence. Eligible properties include single-family homes, condos, and townhomes (manufactured homes are not permitted).

Benefits of the Program

• Qualified applicants receive a 30-year fixed-rate mortgage loan.
• Assistance of 4%, 5%, or 6% of the loan’s principal balance for down payment and closing costs.
• Assistance is provided as a 0% interest, 10-year forgivable second mortgage loan.

Potential Drawbacks

• Forgiveness Terms: The second mortgage is forgivable over 10 years. If the property is sold, refinanced, or no longer the primary residence before this period ends, repayment may be required.
• Interest Rates: Rates can fluctuate daily based on market conditions, so it’s important to check with participating lenders.

How to Apply

1. Contact a Participating Lender: Start by reaching out to an approved lender.
2. Complete Homebuyer Education: If you’re a first-time homebuyer, take a HUD-approved homebuyer education course.
3. Loan Application: Work with the lender to apply for the mortgage under the program’s guidelines.
4. Finalize the Purchase: Upon approval, use the assistance to complete your home purchase.

Where is the Program Available?

The program is available to homebuyers purchasing a home within Travis County, Texas, including the City of Austin.

Pros and Cons

Pros:

• No First-Time Homebuyer Requirement: Open to both first-time and repeat homebuyers.
• Flexible Property Types: Allows single-family homes, condos, and townhomes.
• Competitive Interest Rates: Offers competitive rates on the first mortgage loan.

Cons:

• Forgiveness Period: Requires a 10-year commitment to avoid repayment.
• Credit Score Requirements: Minimum FICO scores of 640-660 may be a challenge for some buyers.

Type of Assistance

The program provides down payment and closing cost assistance in the form of a 0% interest, 10-year forgivable second mortgage loan.

Program Availability

The Hill Country Home Down Payment Assistance Program is currently active and accepting applications. For the latest updates, visit: Travis County Housing Finance Corporation.