What down payment assistance is available for Dallas homebuyers in 2026?

Dallas homebuyers can access up to $60,000 in down payment and closing cost assistance through the Dallas Homebuyer Assistance Program (DHAP), now managed by Business and Community Lenders of Texas (BCL of Texas) as of May 1, 2026. Texas state programs through the Texas Department of Housing and Community Affairs (TDHCA) and the Texas State Affordable Housing Corporation (TSAHC) offer additional grants and deferred second liens of up to 5% of the loan amount. Most programs require a 620+ credit score, household income at or below 80% of the area median income (approximately $82,000–$90,000 for a family of four in Dallas-Fort Worth), and completion of a homebuyer education course before applying.

By Matt Watson, Broker, REALTOR® | June 10, 2026

The down payment stops more Dallas buyers than anything else. You've got the income, the credit score, and a neighborhood you've decided on. But $20,000 to $40,000 sitting in the bank, before you even touch closing costs? That's the wall.

Here's what most buyers in Dallas don't know: programs to help you clear that wall already exist. The City of Dallas offers up to $60,000 in direct assistance. Texas has additional statewide programs on top of that. And in the right scenario, you can stack them.

This is what you need to know about down payment assistance in Dallas for 2026.

The Dallas Homebuyer Assistance Program (DHAP)

DHAP is the City of Dallas's own down payment assistance program. As of May 1, 2026, it's managed by Business and Community Lenders of Texas (BCL of Texas), not the city directly. If you've read older information that directs you to call a city department, the contact information has changed.

How much can you get through DHAP?

  • Up to $50,000 in most areas of Dallas
  • Up to $60,000 in designated high opportunity areas

The assistance covers your down payment, closing costs, and principal reduction. It comes structured as a forgivable second lien — interest-free, with no monthly payments — and it's forgiven over an affordability period while you live in the home as your primary residence. If you sell or refinance before the period ends, you'll repay a prorated portion.

Who qualifies for DHAP?

To be eligible, your household income must be at or below 80% of the Area Median Income (AMI) for your household size. For 2026 in the Dallas-Fort Worth metro, that works out to roughly:

  • 1 person: approximately $57,000
  • 2 people: approximately $65,000
  • 3 people: approximately $73,000
  • 4 people: approximately $82,000–$90,000

You must be purchasing a primary residence. You'll need first lien mortgage approval from a participating lender, and all applicants must complete a readiness check with BCL of Texas before a full application can be submitted.

DHAP also has a specialized tier for current Dallas residents, with slightly different income thresholds. If you've been renting in Dallas for several years and want to stay in the city, it's worth asking specifically about that program track.

How to start with DHAP

Contact BCL of Texas directly. Their Dallas office is at 400 S Zang Blvd, Suite 1220, Dallas, TX 75208. The phone number is 214.688.7456. The readiness check is the required first step — you can't skip it and go straight to an application.

Give yourself time. DHAP requires coordination between BCL of Texas and your mortgage lender, and processing takes weeks. Starting before you have a purchase contract in hand gives you much more flexibility on closing timelines.

Texas State Programs: TDHCA and TSAHC

Even if you don't qualify for DHAP, or you want to explore additional assistance, Texas offers two well-funded statewide programs that work independently or alongside city programs.

My First Texas Home (TDHCA)

Run by the Texas Department of Housing and Community Affairs, My First Texas Home combines a fixed-rate mortgage with down payment and closing cost assistance of up to 5% of the loan amount, structured as a deferred forgivable second lien.

On a $350,000 purchase, 5% is $17,500. On a $400,000 purchase, it's $20,000. That can cover your entire down payment on an FHA loan and put a meaningful dent in closing costs.

Income limits apply (generally 80% AMI), and there's a minimum credit score of 620. This program pairs with FHA, VA, conventional, and USDA loans.

Homes for Texas Heroes and Homes Sweet Texas (TSAHC)

Run by the Texas State Affordable Housing Corporation, TSAHC has two tracks:

  • Homes for Texas Heroes — for teachers, firefighters, law enforcement officers, veterans, and other public service professions
  • Homes Sweet Texas — for buyers who meet income limits but don't fall under the Heroes categories

The assistance is structured as either a grant (doesn't have to be repaid) or a deferred second lien (repaid when you sell, refinance, or pay off the first mortgage). The grant option is attractive for buyers who want a clean deal with no second lien attached.

DPA amounts through TSAHC are typically 3%–5% of the loan amount.

How Stacking Down Payment Programs Can Work

This is where it gets interesting. In the right scenario, you can layer a city program like DHAP with a state program like TDHCA or TSAHC. The rules vary depending on which programs are in play and your lender's guidelines, but here's a simplified example on a $300,000 purchase using an FHA loan:

  • FHA minimum down payment (3.5%): $10,500
  • TDHCA assistance (5% of loan amount): $15,000 — this covers the full FHA down payment and potentially some closing costs
  • DHAP assistance: additional funds toward remaining closing costs
  • Estimated buyer cash needed: potentially under $2,000 out of pocket

That's not a guarantee, and every scenario depends on the programs in play and how your lender structures the transaction. But it illustrates why it's worth understanding all three options before you assume you can't afford to buy.

When I walk buyers through this, the first thing I ask is: have you talked to a lender who actually knows these programs? Not every lender participates in DHAP or TDHCA. If your lender hasn't brought this up, it's worth asking directly. And as you're putting together your full budget, the breakdown in my post on what buyers actually pay at closing in Dallas will help you understand the full picture before the programs fill in the gaps.

What These Programs Won't Cover

It's worth setting clear expectations so you don't get surprised mid-transaction.

Income limits are real. If your household income is above 80% AMI, you'll likely pay your down payment out of pocket or work with a market-rate mortgage structure. Most DPA programs aren't available to moderate-to-higher income buyers.

The home must be your primary residence. Investment properties, short-term rentals, and vacation homes don't qualify. If you're buying an Uptown condo or an East Dallas townhome as a primary residence, you're in the right lane. If it's a rental play from day one, these programs aren't for you.

DHAP assistance is a second lien. It's not free money attached to nothing. If you sell in year one or two to capture appreciation, you'll repay a prorated portion. For buyers planning to stay five or more years, this is rarely a practical concern.

Funds can run out. DHAP and TDHCA both operate on a first-come, first-served basis. The programs are regularly funded, but availability isn't guaranteed at any given moment. Don't assume you have unlimited time to start the process after you find a home.

Condo projects need to qualify too. If you're buying a condo in Uptown or Oak Lawn, your lender will review the condo association's financials in addition to your own. A project with too many investor-owned units, active litigation, or HOA reserve issues can affect your loan eligibility — and by extension, your ability to use DPA funds with that property.

After You Close: The Other Cost-Saver

Down payment assistance gets you into the home. The Texas homestead exemption keeps money in your pocket every year you stay. Filing with the Dallas Central Appraisal District is a step you take after closing — it's not automatic, and missing the January 1 eligibility date can push your savings back a full year.

I put together a detailed walkthrough on how to file the Texas homestead exemption in Dallas, including what it saves on your annual tax bill and exactly how to complete the application with DCAD. It's worth reading before your closing date so you're ready to file right away.

Frequently Asked Questions

Do I have to be a first-time buyer to use down payment assistance in Dallas?

Most Dallas DPA programs define "first-time buyer" as someone who hasn't owned a primary residence in the past three years. If you owned a home before and have rented for at least three years, you may still qualify. DHAP also has a specialized tier for current Dallas residents with different income thresholds worth asking about.

Can I use down payment assistance to buy a condo or townhome in Dallas?

Generally, yes, as long as the property will be your primary residence. For condos, your lender also needs to verify that the condo project meets their lending guidelines — conventional, FHA, or otherwise. A non-warrantable condo (one with HOA issues, high investor concentration, or pending litigation) can limit your financing options regardless of down payment assistance.

What credit score do I need for Dallas down payment assistance programs?

Most programs, including TDHCA My First Texas Home and TSAHC Homes Sweet Texas, require a minimum credit score of 620. DHAP requirements are tied to your first lien lender's underwriting standards. If your score is below 620, working with a HUD-approved housing counselor to build your credit is usually the right first step before applying.

How long does the DHAP application process take?

DHAP requires a readiness check with BCL of Texas as the first step, followed by a homebuyer education course before a full application can be submitted. Build at least 60 to 90 days into your timeline from first contact to closing. Starting before you have a signed contract gives you the most flexibility on your closing date.

Can I use down payment assistance with a VA loan?

Yes. TDHCA's My First Texas Home program is compatible with VA loans. If you're a veteran purchasing in Dallas with a VA loan, you may be able to layer TDHCA assistance to cover closing costs even if the VA loan doesn't require a down payment from you.

Down payment assistance programs in Dallas aren't talked about nearly as much as they should be. A lot of buyers assume the answer to "can I afford to buy?" is just about what's sitting in savings — but between DHAP, TDHCA, and TSAHC, the picture is often more favorable than you'd expect.

If you're trying to figure out whether these programs are a fit for your situation, I'm happy to work through it with you. Every buyer's numbers are different, and the right combination of programs depends on your income, your credit, and the property you're targeting. Reach out at mattwatson.com to schedule a free consultation and we'll look at your full picture together.

About Matt Watson, Broker, REALTOR®
Matt Watson is a Dallas-based real estate broker and REALTOR® with over 25 years of experience in the city's urban core neighborhoods. He specializes in condos, townhomes, and single-family homes in Uptown, Oak Lawn, East Dallas, and North Oak Cliff. Whether you're buying your first condo or selling a longtime home, Matt brings deep local knowledge and straightforward guidance to every transaction. Connect with Matt at mattwatson.com.