What Is TSAHC and Why Does It Matter for Central Texas Buyers?

TSAHC — the Texas State Affordable Housing Corporation — runs the state’s largest down payment assistance programs for homebuyers. If you’re buying in San Antonio, Austin, Killeen, or anywhere in Central Texas, TSAHC can cover up to 5% of your mortgage amount as a grant you never repay.

Most buyers I work with don’t know TSAHC exists until we’re already deep into pre-approval. That’s a problem, because the program changes the math on affordability entirely. On a $300,000 home in northeast San Antonio, a 5% TSAHC grant means $15,000 toward your down payment and closing costs — money you keep in your pocket. The program works with FHA, VA, USDA, and conventional loans, and it isn’t restricted to first-time buyers under every track. Two main programs exist: My First Texas Home (first-time buyers or those who haven’t owned in three years) and My Choice Texas Home (open to repeat buyers too). Both use the same lender network and the same application process.

How Does TSAHC Compare to Other Texas Down Payment Assistance Programs?

TSAHC offers the most flexible down payment assistance in Texas, but it’s not the only option. TDHCA’s My First Texas Home program, city-specific programs in San Antonio (SAHA’s homeownership program) and Austin (Austin Housing Finance Corporation), and lender-funded DPA all compete for the same buyers.

The key differentiator: TSAHC’s grant option requires zero repayment. TDHCA’s program uses a deferred second lien that comes due when you sell or refinance. For a buyer planning to stay in a home near Fort Cavazos for a three-year PCS cycle, that distinction matters — you’ll likely sell within the forgivable window on a city program but still owe the full TDHCA lien. TSAHC’s grant has no such strings. The San Antonio and Austin city programs can offer higher dollar amounts in targeted ZIP codes, but funding runs out fast and the application windows are narrow. TSAHC accepts applications year-round as long as funds remain allocated.

Who Qualifies for TSAHC in 2026?

Qualification depends on household income, purchase price, and credit score — not your employment type or buyer history (under My Choice). The income limits are more generous than most buyers expect.

A dual-income household earning $95,000 buying a $340,000 home in Converse or Live Oak (northeast Bexar County) qualifies under both programs. A single E-7 at Fort Cavazos with a household income of $72,000 buying a $260,000 home in Harker Heights qualifies easily. The income limits exclude most high earners, but they cover the majority of first-time and workforce buyers across Central Texas.

How Much Does TSAHC Actually Save You?

On a $300,000 home, the 5% grant delivers $15,000 at closing. That’s real money — enough to cover a 3.5% FHA down payment plus most of your closing costs, or the full closing cost package on a zero-down VA Loan.

Veterans using a VA Loan benefit differently. Since VA requires no down payment, the entire 5% TSAHC grant applies to closing costs and the VA Funding Fee. On a $280,000 purchase near Fort Cavazos — say, a home in Copperas Cove or Nolanville — the VA Funding Fee for a first-time user is $6,440 (2.3%). The TSAHC grant of $14,000 covers that fee plus title, appraisal, and lender origination. The buyer walks into the home with cash left over from the grant.

TSAHC also offers a Mortgage Credit Certificate (MCC) that provides a federal tax credit of up to $2,000 per year for the life of the loan. The MCC can be combined with the DPA grant — most buyers don’t realize you can stack both. Over a 10-year ownership period, the MCC adds $20,000 in cumulative tax savings on top of the initial grant.

What Are the Drawbacks of Using TSAHC?

TSAHC isn’t free money without trade-offs. The interest rates on TSAHC-funded mortgages run 0.25%–0.75% higher than market rates, and the lender network is limited.

The rate premium is the biggest consideration. Run the math with your lender: if the added interest over your expected ownership period exceeds the grant value, the program costs more than it saves. For buyers planning to stay 3–7 years, the grant almost always wins. For buyers planning 15+ years with no refinance, the higher rate can erode the benefit.

How Do You Apply for TSAHC in San Antonio, Austin, or Killeen?

You apply through a TSAHC-approved lender, not through TSAHC directly. The lender handles the full process — TSAHC funds flow through the loan file at closing.

Step one: find a participating lender. TSAHC’s website maintains a searchable directory by county. In Bexar County, lenders like Supreme Lending, Cornerstone Home Lending, and several local credit unions participate. In Travis County, the list overlaps but includes some Austin-focused brokers. Bell County has a smaller roster — confirm participation before you start an application.

Step two: get pre-approved. The lender will run your income, credit, and purchase price against TSAHC’s current limits. If you qualify, they’ll lock your rate under TSAHC’s program pricing and reserve your DPA allocation. Funding is first-come, first-served — when the annual allocation runs out, the program pauses until the next funding cycle. Historically, TSAHC has not run out of funds mid-year, but demand has increased steadily since 2023.

Step three: complete homebuyer education. The online course is free through TSAHC’s approved providers. It covers budgeting, the mortgage process, and homeownership responsibilities. Plan for 6–8 hours total. You’ll receive a certificate that your lender submits with the loan file.

Step four: find a home, go under contract, and close. Your lender will coordinate the TSAHC funds — they arrive at the title company as part of the closing package. The grant or second lien is recorded on the HUD-1 settlement statement. There’s no separate TSAHC closing or additional paperwork beyond what your lender handles.

Is TSAHC Worth It for Military Families Near Fort Cavazos?

For most Military buyers near Fort Cavazos, TSAHC combined with a VA Loan is the strongest financing package available in Texas. Zero down payment from the VA side plus up to 5% in grant money from TSAHC means you can buy a home and keep your savings intact.

A typical scenario: an E-6 with a household income of $68,000 buying a $255,000 home in Harker Heights (76548). The VA Loan covers 100% of the purchase price. TSAHC’s 5% grant adds $12,750 at closing — enough to cover the VA Funding Fee ($5,865 for a first-time VA buyer), lender fees (~$3,000), title and escrow (~$2,500), and prepaid property taxes (~$1,200). That buyer brings zero cash to closing and may even receive a small credit back.

The BAH for Fort Cavazos (Bell County) in 2026 supports mortgage payments on homes up to roughly $280,000–$310,000 depending on rank and whether dependents are claimed. TSAHC’s purchase price cap of $390,000 is well above the typical purchase range near the base, so the cap rarely becomes an issue here. Compare that to Austin, where median home prices in desirable school districts often bump against the cap.

PCS timing matters. If you receive orders within 2–3 years, the grant is still yours — no clawback provision. The recapture tax is theoretically possible but requires a significant income jump and home price appreciation simultaneously, which is uncommon on a short cycle in the Killeen-Temple market. For most Military families on a 3-year rotation, TSAHC is effectively free money.

Should You Use TSAHC or Save for a Larger Down Payment?

If you have less than $15,000 in liquid savings and you’re buying under $390,000, use TSAHC. The math favors the grant in almost every scenario where savings are tight.

The argument for saving a larger down payment is PMI elimination — put 20% down on a conventional loan and you skip private mortgage insurance entirely. On a $300,000 home, 20% down is $60,000 in cash. Most Central Texas buyers don’t have that. Even a 10% down payment ($30,000) only reduces PMI, it doesn’t eliminate it. Meanwhile, TSAHC’s 5% grant lets you close with minimal cash and redirect your savings toward an emergency fund, moving costs, or home repairs.

In San Antonio’s current market, median home prices sit around $290,000–$310,000 depending on the submarket. Alamo Ranch, Helotes, and Stone Oak trend higher ($340,000–$400,000). Southeast San Antonio, Converse, and Universal City trend lower ($240,000–$290,000). In the lower price range, a TSAHC grant of $12,000–$14,500 can fully cover down payment and closing costs. In the higher range, you may still need $3,000–$5,000 out of pocket even with the grant — but that’s a fraction of what you’d need without it.

For Austin buyers, the calculus is tighter. Median prices in Round Rock, Pflugerville, and Cedar Park hover around $380,000–$420,000. The TSAHC purchase price cap of $390,000 limits your options to the lower end of that range or to emerging areas like Hutto, Taylor, and Jarrell where homes in the $280,000–$350,000 range are still common. If you’re set on central Austin or the 78704/78745 corridors, TSAHC’s price cap may push you toward city-level programs with higher limits instead.

Bottom line: TSAHC is the best statewide DPA program in Texas for buyers under the income and price caps. The grant option eliminates repayment risk. The MCC stacks additional long-term savings. The rate premium is a real cost, but for buyers in the 3–10 year ownership window, the upfront grant value outweighs the added interest. If you’re buying in San Antonio, Killeen, or the more affordable pockets of the Austin metro, start with a TSAHC-approved lender and run the numbers before you consider any other path.