Housing and Community Development Department

Homebuyer Assistance Program

Houston’s Housing and Community Development Department (HCDD) administers the City’s Homebuyer Assistance Program (HAP) for eligible low- to moderate-income families. Funds may be used to assist an approved applicant in paying down payment, closing costs, and principal buydown.

Homebuyer Assistance Program Qualifications:

  • Must be a first-time homebuyer or not have owned a home within the last three years.

  • Must not have more than $10,000 in liquid assets prior to closing (deferred assets such as pensions, 401(k)s, etc. are not included).

  • The buyer, co-borrower and non-purchasing spouse must be a U.S. citizen or permanent resident alien.

  • Applicants must not be registered sex offenders.          

  • Buyer must be able to obtain a fixed-rate mortgage. The program does not accept adjustable-rate mortages (ARM) or seller-financed mortgages.

  • Combined household income must be at or below the incomes listed in the following chart based on household size:

2016 Maximum Household Income Limits

Household Size
70% of the Area Median Income (AMI) *
80% of the Area Median Income (AMI) *
1
$33,950
$38,750
2
$38,780
$44,300
3
$43,610
$49,850
4
$48,440
$55,350
5
$52,360
$59,800
6
$56,210
$64,250
7
$60,130
$68,650
8
$63,980
$73,100

* Income includes any payments from employment, child support, recurring gifts, etc. Household income limits are subject to change.

Homebuyer Assistance Program Guidelines:

  • An eligible homebuyer at or below 70% AMI may receive $25,000 in assistance.

  • An eligible homebuyer at or below 80% AMI (but above 70% AMI) may receive $15,000 in assistance.

  • The selected home must be located within the property tax jurisdiction of the City of Houston.

  • Eligible property types include single-family homes, duplexes, triplexes or quadraplexes, attached townhomes, condominiums, or cooperative units.

  • Each applicant must take a Homebuyer Education Course through an approved HUD counseling agency.

  • Applicants must occupy the home as their principal residence for a minimum of five years.

  • The homebuyer assistance program will contribute no more than 50% of the lender’s required down payment.

  • The back-end ratio cannot exceed 45%.

  • Property must pass an environmental and inspection review.

  • The buyer, co-borrower, or non-purchasing spouse cannot be delinquent on any student loans, federal income taxes, as well as state and local taxing authorities, utility payments, or City services.

HAP Frequently Asked Questions:

  1. May I qualify for more than $25,000 of assistance? No, the maximum amount of assistance under this program is $25,000.

  2. How is the back-end ratio calculated? 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 income. For example, a borrower whose monthly income is $5,000 ($60,000 annually divided by 12) and who has total monthly debt payments of $2,000 has a back-end ratio of 40% ($2,000/$5,000).

  3. May I use the full amount of assistance as a down payment? No, the assistance may not pay for more than 50% of the lender’s required down payment. The assistance is normally divided between down payment costs, closing costs, and principle buydown.

  4. How do I determine if a home is located within the property tax jurisdiction of the City of Houston? Visit the Harris County Appraisal District’s (HCAD) website at www.hcad.org and enter the home’s address. If HCAD shows the home is taxed by the City of Houston, the home will qualify for the program.

  5. How is household income determined? Visit the HUD Income Calculator website, go to the "Start Calculating Income" section, and follow the instructions to calculate your household income.

  6. May I take the homebuyer education course online? A HUD-approved homebuyer education course may be done online, as long as you complete a one-on-one homebuyer advising/counseling session with a HUD-approved counseling agency. Each applicant must obtain a Homebuyer Education Certificate through a HUD-approved counseling agency.

  7. What if I need to sell my home before I have lived in it for five years? The loan will be forgiven at a rate of 20% for each full year of residency in the home. For example, if you receive assistance in the amount of $25,000, and complete three of the required five years, 60% or $15,000 of subsidy will be forgiven, leaving a balance owed of $10,000.

  8. How long does the process take? Typically, a preliminary approval can be received within 72 business hours, with a full file approval completed within two weeks.

  9. Am I required to work with an approved program lender? No, the program does not have an approved lender list. Applicants may choose any lender.

Next Steps:

Ready to apply? Please gather all of the documents listed on the following Applicant Checklist form and call us at 832-394-6200 to begin the application process.

 

Program is subject to change. Additional requirements may be applicable. Call 832.394.6200 to verify current requirements.