Can I really buy a home with no down payment in Texas?

Yes, some buyers can. Eligible veterans and service members can use a VA loan with zero down, USDA offers 100% financing in eligible rural and suburban areas, and Texas down payment assistance can cover part or all of the down payment on other loans. Zero down still does not mean zero cash needed at closing, so get a written cash-to-close estimate for each eligible option.

Which loans allow zero down payment?

VA loans allow zero down for eligible borrowers with no monthly mortgage insurance and a one-time funding fee that can be financed. USDA loans provide 100% financing in eligible areas with income limits. FHA requires 3.5% down and conventional can go as low as 3%, but Texas DPA programs can help cover those amounts when you qualify.

Is down payment assistance free money?

Some of it is. A DPA grant never has to be repaid. A forgivable second lien is wiped out if you live in the home for the forgiveness period, typically around three years in the Texas programs. A repayable second lien is a deferred 0% loan that comes due when you sell, refinance, transfer, or pay off the first mortgage.

What are the trade-offs of buying with zero down?

The cost shows up somewhere: a VA funding fee on your balance, a USDA annual fee in your payment, FHA mortgage insurance that travels with the loan, or a DPA second lien that forgives slowly or comes due at the exit. You also still need cash for inspections, earnest money, the Texas option fee, appraisal, prepaids, and reserves.

What credit score do I need for a zero-down or DPA purchase?

Most Texas DPA programs require a 620 credit score or better, even when the underlying loan allows less, and TSAHC lists 640 for conventional. USDA lenders typically look for 640 or better, and VA relies mostly on lender standards. Your exact number depends on the program and the loan.

How little cash has a buyer actually closed with in Texas?

A real-world example Patrick walks through is a $245,000 home closed for roughly $3,000 out of pocket using down payment assistance, and a $300,000 home structured with FHA plus DPA plus seller concessions closed with about $1,000 cash to close. The exact number for your file depends on the program, the price, and the negotiation.

Buy a Home With No Down Payment in Texas: VA, USDA, DPA

Quick Answer

Sometimes. Eligible VA and USDA borrowers may qualify for zero-down financing. Other buyers may use DPA, gifts, or seller credits, but zero down does not necessarily mean zero cash needed at closing.

Get help lowering your cash to close and buying with no down payment.

VA: zero down, no mortgage insurance, for those who served

VA-backed loans generally do not require a down payment for eligible borrowers. VA also states that lenders may require a down payment in some situations and that VA loans do not require private mortgage insurance. ^[1] benefits.va.gov That combination, zero down and no monthly mortgage insurance, is why VA is the strongest financing most veterans will ever be offered, and this page covers the loan program only.

The costs to watch: the one-time VA funding fee, which can be financed into the loan instead of paid out of pocket, and can be waived for veterans with a qualifying service-connected disability rating. The fee rate depends on down payment, first use, and service type.

The catch: VA is for your primary residence. You buy it to live in it, not to rent it out on day one, and the lender still underwrites your credit and income. If you served, this is the first loan to ask about, and the answer will usually save you the most money.

VA loan infographic showing zero down payment, no monthly mortgage insurance, the one-time funding fee, and eligibility for veterans and service members — The VA path: zero down, no monthly mortgage insurance, and a funding fee that can be financed. This page covers the loan program only.

USDA: zero down in eligible areas, with income limits

USDA's Single Family Housing Guaranteed Loan Program provides 100% financing for qualifying buyers purchasing eligible homes in eligible rural areas. Household income and property eligibility must be verified through USDA and the lender. ^[2] Rural Development

The costs to watch: an upfront guarantee fee and an annual fee, both lower in practice than FHA's monthly mortgage insurance, and a strict debt-to-income guideline that typically caps total debt around 41%. The income limit is tied to the county, so a household that qualifies in one county may not qualify in another.

The catch: the address has to pass the USDA eligibility map, and the income ceiling is real. Zero down sounds unlimited, but the program's debt limits pick the house before you do, which is why the same income can buy more elsewhere.

USDA loan infographic showing 100 percent financing, eligible rural and suburban areas, income limits, and the debt-to-income requirement — The USDA route: 100% financing in an eligible area, with income and debt limits that gate every file.

Down payment assistance: grants vs second liens, and the honest costs

FHA financing can require as little as 3.5% down, and conventional loans can be available with as little as 3% down for eligible borrowers. ^[3] hud.gov Texas DPA programs may help cover a required down payment or closing costs when their rules permit, and TDHCA's 2026 matrices list assistance options for FHA, VA, USDA, and certain conventional loans. ^[4] MFTH_Program_Matrix

Grants: money that never has to be repaid. This is the closest thing to free money in the program, and it is capped by dollar amount or percentage so every program guards it.

Forgivable second liens: a 0% second mortgage that is wiped out if you live in the home for the forgiveness period, typically three years under the Texas programs, and repaid if you sell or refinance before then.

Repayable second liens: a deferred 0% loan that stays on title and comes due when you sell, refinance, transfer, or pay off the first mortgage. It lowers your cash to close today and becomes a bill at the exit.

The honest costs and gates: income caps that vary by county and household size, credit minimums that are usually 620 or better even when the underlying loan allows less, purchase price caps that change with the program, a required homebuyer education course, and the fact that the assistance sits on your title as a second lien. It is fantastic help, but it is structured help with rules, and the rules are exactly what we check before you fall in love with a house.

Down payment assistance restrictions infographic showing income caps, credit minimums, price caps, and repayment terms that come with Texas DPA programs — DPA is help with rules: income caps, credit minimums, price caps, education, and repayment terms all gate who qualifies.

One worked real-world close: a $245,000 home for about $3,000 out of pocket

Here is what this looks like when it actually closes, a real-world example I have walked buyers through: a $245,000 home bought for roughly $3,000 out of pocket with down payment assistance. The loan covers the purchase, the assistance program covers the down payment, and the buyer's own money covers only the unavoidable bits the program does not touch.

The math matters more than the marketing: a $245,000 loan at a conventional 3% down needs $7,350 before closing costs, and at FHA 3.5% it needs $8,575. Drop a Texas DPA grant or forgivable second lien on top at the typical 3% to 5% of the loan, and the down payment disappears from the buyer's side of the ledger entirely, leaving a few thousand dollars for the pieces that always remain, the inspection, the option fee, the prepaids, the moving truck.

That is the honest version of "no money down": not literally zero cash, but a closing check small enough to fit a starter savings account, in exchange for homework, program rules, and a second lien you either live out or repay on the exit. ^[5] Consumer Financial Protection Bureau explains that cash to close includes the down payment and closing costs, reduced by deposits, credits, and other adjustments, which is exactly how this close gets so low.

True Life Closing Victoria graphic showing a $245,000 home bought for roughly $3,000 out of pocket using down payment assistance — A $245,000 home closed for roughly $3,000 out of pocket with down payment assistance, the real-world version of the zero-down playbook.

The honest trade-off of zero down

Zero down is not free, it is financed. Somewhere, the cost shows up: a VA funding fee on your balance, a USDA annual fee in your payment, FHA mortgage insurance that travels with the loan, or a DPA second lien that either forgives slowly or comes due at the exit. The cheapest entry ticket and the cheapest long-term loan are rarely the same product.

The other trade is reserves. "No down payment" does not mean "no cash needed." You may still need money for inspections, earnest money, an option fee in a Texas contract, appraisal, prepaid taxes and insurance, moving costs, reserves, or costs that the assistance program does not cover. I have seen buyers close at 0% down with nothing left for the water heater in month three, which is why the safest approach is to ask for a written cash-to-close estimate under each eligible loan option, and to plan a real cushion before you sign.

Watch: buy a $300,000 home with about $1,000 down

This is the video where I run the exact combination, FHA plus down payment assistance plus seller concessions, that took a $300,000 home all the way down to a roughly $1,000 closing check.