Homeownership is a dream for many Houstonians but out of reach for many residents. The City offers up to $30,000 to income-qualified residents.
The City offers two programs to assist homebuyers within the city: the Homebuyer Assistance Program (covered on this page) and the Harvey Homebuyer Assistance Program .
Please note that the Homebuyer Assistance Program has limited funding. We are also administering assistance through the Harvey Homebuyer Assistance Program, which has slightly different requirements. The Harvey Homebuyer Assistance Program offers assistance to homebuyers who make up to 120% of Area Median Income and were in Houston on August 25, 2017. See the program page for details .
To get started
Do I Qualify?
- First-time homebuyer (or have not owned a home in the last 3 years).
- Household income at or below 80% of Area Median Income .
- Home you want to purchase pays taxes to the City of Houston.
Our assistance is a no-interest, forgivable loan secured by a lien. The loan is fulfilled if the buyer lives in the home for five years. If the buyer sells or moves out of the home before the end of five years, they will pay back the City for a portion of the original loan amount.
Seven Easy Steps to Homeownership
Obtain a home loan through a lender.
Obtain a homebuyer education class certificate through a HUD-Approved Agency.See a list of accepted locations
Call 832-393-0550 to complete an application and determine your eligibility.
Find a home that is taxed by the City of Houston.
Pass environmental inspection and underwriting review.
Sign the terms and conditions disclosure.
Application and Follow-Up Documents
The applicant submits all documents on the Applicant Document Checklist, including:
- Program Application/Intake Form
- Proof of income for all household members
- Pre-approval letter
- Homebuyer education course certificate
- Statement and Explanation of Facts (Form 1010)
- First-Time Homebuyer Status and Certification of Property Ownership
- Conflict of Interest Form
- Certificate of Zero Income
- See the full list
- Before submitting an application, the applicant must call 832.393.0550 to receive their applicant ID number
In order to finish the Application and Intake Form, you will need to call us at 832-393-0550 to receive an Applicant ID number. Incomplete applications cannot be processed. Please be sure that you have collected all the documents on the Document Checklist before submitting your application.
Once submitted, the City reviews all materials and will issue a Conditional Reservation Letter to accepted applicants.
Property & Lender
Once you receive a Conditional Reservation Letter, it is time to put a property under contract.
The lender will need to submit all the documents on the Property & Lenders Checklist , including:
- Property Data Sheet
- Loan Disclosure Form
- Lead Based Paint Acknowledgement
- Notice to Sellers
- See the full document checklist
The City then reviews these materials and places our loan assistance into underwriting. Meanwhile, the property will be inspected and given an environmental review.
If approved, the City will then issue a Commitment Letter .
Funding and Closing
Once you receive a Commitment Letter , you will complete a pre-closing meeting.
Instructions and loan closing documents are sent to title and lender, who submit pre-closing documents, including:
- Wiring Instructions for funds
- Preliminary Closing Disclosure
- Insurance Benefits and Expenditures
- See the full pre-closing document checklist
Funds from the Homebuyer Assistance Program are wired on the day of closing.
The title and lender will then submit post-closing documents, including:
- Original Executed City Deferred Payment Loan Note
- Final Certified Closing Disclosure
How to Submit Documents
You may submit your application in one of four ways:
Via Mail or In Person
Housing & Community Development Department
2100 Travis Street, 9th Floor
Houston, TX, 77002
Frequently Asked Questions - Applicants
Q: How long does the process take? - Answer
A: The Homebuyer Assistance Program takes about six weeks, provided there are no external delays. Please note that the six weeks is measured from the time the applicant submits a complete application. We cannot begin work on an incomplete application.
Q: Are there any fees associated with the program? - Answer
A: The buyer must contribute a minimum of $350 to the down payment of the home, but no additional fees are paid to the City of Houston. If someone tells you that there are participation fees, please report them for fraud .
Q: Is this program only available in certain areas? - Answer
A: No, the Homebuyer Assistance Program applies to any home that pays taxes to the City of Houston .
Q: Are credit reports required for all household adults? - Answer
A: No. All household income must be reported, but only the loan applicant’s credit is reviewed during underwriting.
Q: Is there a debt-to-income requirement? - Answer
A. Yes, the program requires a 45% back-end ratio. The back-end ratio is calculated by adding together all of a borrower’s monthly debt payments and dividing the sum by the borrower’s monthly gross income. For example, if a borrower has a monthly gross income of $5,000 and monthly debt payments of $2,000, their back-end ratio is 40% ($2000/$5000). The Homebuyer Assistance Program requires that an applicant has a back-end ratio less than 45%.
Q: Is there a credit score requirement? - Answer
A: No, the Homebuyer Assistance Program does not consider credit score.
Q: Is there a maximum home price? - Answer
A: No. The buyer can select any home that fits their needs and budget.
Q: Can the buyer(s) receive cash back if they don’t use the $30,000 on down payment? - Answer
A: No, buyers cannot receive cash back in excess of the out-of-pocket costs made in the transaction.
Q: What is the five-year second lien? - Answer
A: When the City provides assistance for someone to buy a home, we are making an investment for someone to live in the home for the long-term. We require they live within the home for five years, secured through a forgivable loan. The loan is automatically forgiven at the end of the five-year residency period. At the end of the five years, please submit this Release of Lien Request to HCDDLoanServicing@houstontx.gov.
Q: What if I have to sell my home or move out before the five years are over? - Answer
A: In these cases, the City will collect a portion of the investment made, proportional to the amount of time remaining in the residency period. For example, if the City provided $30,000, and the homebuyer moves after two years, they will only be charged for the three remaining years, or $18,000. To begin this process, please submit this Payoff Statement Request form to HCDDLoanServicing@houstontx.gov.
Q: What if I need to refinance my home? - Answer
FAQs - Real Estate and Lending Professionals
Q: Does this program follow FHA guidelines? - Answer
A: No. The Homebuyer Assistance Program sets and follows its own internal guidelines. Our underwriting includes calculating debt-to-income ratio, ensuring that there are no outstanding collections for government services or utilities, and verifying that there are no defaulted student loans.
Q: Is there a cost for the City’s inspection? What does this inspection include? - Answer
A: The inspection is a free service conducted by our department. A sample of the inspection can be downloaded (alternative version . Please note that the City’s inspection does not replace an independent inspection; we strongly recommend that the buyer do their own inspection.
Q: What is the environmental review, and why is it needed? - Answer
A: The environmental review primarily looks at where the home is located relative to the floodway and floodplains. Homes located in flood zones are required to have flood insurance to complete the purchase.
Q: Is there a mandatory training that lenders and realtors must take to participate in the program? - Answer
A: No. Any lenders and realtors may participate. We do offer a monthly class that can be helpful in sharing the steps of the process with interested professionals. You can sign up at this link .
Q: Who is the loan servicer? - Answer
A: The Homebuyer Assistance Program is serviced internally with our Loan Servicing Division. The loan is not amortized; however, there is a 6% fee applied to the defaulted loan balance.
Q: Can the program funds be used to pay realtor commissions? - Answer
A: No, the funds are strictly for down payment, closing costs, pre-paids and principal reduction. Should the buyer choose to pay a realtor commission, they will have to do so from their personal funds.