Texas VA Loan + DPA for First-Time Buyers (TSAHC)

Texas DPA for Veterans: The Ultimate Combination

Texas veterans can pair two strong benefits: a VA loan and Texas down payment assistance. Because VA loans have no down payment requirement, the assistance from TSAHC programs (up to 5% of the loan amount) can go entirely toward closing costs, so far less of your own savings is needed at the closing table.

According to TSAHC, 9,554 Texas families purchased homes with DPA assistance in 2025, receiving $85.6 million in total down payment assistance. Veterans represent a significant portion of these families, particularly through the Homes for Texas Heroes program.

This guide explains exactly how Texas veterans can combine VA loans with TSAHC assistance to maximize their benefits.

Key Takeaways

VA loans require $0 down payment—your entire 5% DPA goes toward closing costs
TSAHC offers grant options—veterans can receive DPA that never needs to be repaid
Both active duty and veterans qualify—current service members and honorably discharged veterans are eligible
VA loans have no monthly mortgage insurance—a charge FHA borrowers carry in every payment
TDHCA programs exempt veterans from first-time buyer requirements—repeat veteran buyers qualify for all programs

Why VA + Texas DPA Is So Powerful

Most home buyers need down payment assistance to cover their down payment. But VA loans are different—they already require no down payment. This creates a unique advantage for veterans:

Loan Type	Down Payment Required	Where DPA Goes
FHA	3.5%	Down payment first, remainder to closing costs
Conventional	3-5%	Down payment first, remainder to closing costs
VA	0%	100% to closing costs

With an FHA loan, part of your assistance has to cover the 3.5% minimum down payment before anything reaches your closing costs.

With a VA loan, there's no down payment requirement, so the assistance goes to closing costs from the first dollar. Add seller concessions (VA allows them up to 4% of the purchase price) and your cash to close can drop well below what an FHA buyer would need. You'll still pay earnest money and the inspection up front.

VA Alone vs. VA + Texas DPA: What Changes

Here's how the cash side of a VA purchase shifts when you add Texas DPA:

Cost Item	VA Loan Only	VA Loan + TSAHC DPA
Down Payment	None required	None required
VA Funding Fee	Paid at closing or financed into the loan	Financed, or paid from the assistance
Closing Costs	Paid from your savings or seller concessions	Assistance (up to 5% of the loan amount) applied first
Cash You Bring	Closing costs the seller doesn't cover	Only what the assistance and seller credits don't cover

Note: Earnest money and inspections are usually paid before closing either way. Veterans who receive VA disability compensation are generally exempt from the funding fee.

The difference can be large on a typical Texas purchase. Once you're under contract, your Loan Estimate itemizes the expected cash to close for your price and county, and the Closing Disclosure confirms the final number.

Which Texas DPA Programs Work with VA Loans?

All four major Texas DPA programs support VA loan financing:

Program	Agency	Grant Option	First-Time Required	VA Compatible
My First Texas Home	TDHCA	No	Yes (veterans exempt)	Yes
My Choice Texas Home	TDHCA	No	No	Yes
Homes for Texas Heroes	TSAHC	Yes	No	Yes
Home Sweet Texas	TSAHC	Yes	No	Yes

Best Choice for Most Veterans: Homes for Texas Heroes

The Homes for Texas Heroes program is specifically designed for veterans and offers:

Grant option (no repayment required)
No first-time buyer requirement
Works with VA, FHA, USDA, and conventional loans
Up to 5% of loan amount in assistance

TDHCA Advantage for Veterans

TDHCA programs normally require first-time buyer status for My First Texas Home, but veterans are specifically exempted from this requirement. According to TDHCA guidelines, veterans and active-duty military can use My First Texas Home even if they have owned a home before.

Eligibility Requirements for Veterans

VA Loan Eligibility

To qualify for a VA loan, you must meet one of these service requirements:

Service Type	Minimum Service
Active Duty (wartime)	90 continuous days
Active Duty (peacetime)	181 continuous days
National Guard/Reserve	6 years, or 90 days active duty
Surviving Spouse	Unremarried spouse of veteran who died in service or from service-connected disability

You must also have received an honorable discharge (or be currently serving).

TSAHC DPA Eligibility

In addition to VA eligibility, you must meet TSAHC requirements:

Credit score: Minimum 620
Income limits: Vary by county (typically $80,000-$127,000 for 1-2 person households)
Primary residence: The home must be your primary residence
Homebuyer education: Complete an approved course (online options available)

How the VA Funding Fee Works with DPA

The VA funding fee is a one-time charge that helps fund the VA loan program. For first-time VA loan users putting $0 down, the fee is 2.15% of the loan amount (as of 2026).

Scenario	Fee Rate
First use, $0 down	2.15%
Subsequent use, $0 down	3.3%
Receiving VA disability compensation	0% (exempted)

Because the fee is a percentage of the loan amount, how you handle it matters. It can be:

Paid at closing (using DPA funds)
Financed into the loan (increasing your loan amount slightly)

Veterans receiving VA disability compensation are exempt from the funding fee entirely, saving thousands of dollars.

Step-by-Step: Combining VA + Texas DPA

Step 1: Obtain Your Certificate of Eligibility (COE)

Your VA COE verifies your eligibility for VA loan benefits. You can obtain it:

Online through VA eBenefits
Through your lender (we can request it on your behalf)
By mail using VA Form 26-1880

Step 2: Check Your DPA Eligibility

Use our qualifier quiz to see which Texas DPA programs you qualify for. We will verify your income, credit, and program eligibility.

Step 3: Complete Homebuyer Education

Both TDHCA and TSAHC require a homebuyer education course. This can be completed online in 4-8 hours through approved providers like eHome America or Framework Homeownership.

Step 4: Get Pre-Approved

Work with a VA-approved lender who also participates in Texas DPA programs, like Cook Brothers Mortgage Team at Cornerstone First Mortgage (NMLS #173855). We will:

Verify your VA loan eligibility
Confirm your TSAHC or TDHCA eligibility
Issue a pre-approval letter showing your buying power

Step 5: Find Your Home

Shop for homes within the purchase price limits for your county. VA loans have specific property requirements that the home must meet.

Step 6: Close with Maximum Benefits

At closing, your VA loan can finance the full purchase price with no down payment, your assistance goes toward closing costs, and your Closing Disclosure shows anything left for you to pay.

VA Loan Benefits Beyond $0 Down

When combined with Texas DPA, VA loans provide exceptional benefits:

Benefit	Impact
No down payment	100% financing
No monthly mortgage insurance	One less charge in your monthly payment than FHA
Pricing	Set by each lender; compare VA, FHA and conventional quotes at the same credit score
Flexible credit	More forgiving than conventional
No prepayment penalty	Refinance or pay off anytime
Assumable	Next buyer can assume your loan

Skipping monthly mortgage insurance is particularly valuable. FHA borrowers pay an annual premium, billed monthly, for as long as the loan requires it. VA loans don't carry that monthly charge; the one-time funding fee covered above is VA's version of that cost.

Frequently Asked Questions

Can active-duty military use Texas DPA?

Yes. According to TSAHC and TDHCA guidelines, active-duty service members qualify for all Texas DPA programs. The Homes for Texas Heroes program specifically includes "military members" in its eligible professions list.

Do I need a Texas-specific VA entitlement?

No. VA loan benefits are federal and work anywhere in the country. Your VA entitlement from anywhere in the US can be used to purchase a home in Texas with Texas DPA programs.

What if I have already used my VA loan before?

You may still have remaining entitlement, or your entitlement may be fully restored if you have paid off your previous VA loan. Additionally, TDHCA exempts veterans from the first-time buyer requirement, so you can still use My First Texas Home even if you have owned before.

Can I use Texas DPA if I receive VA disability compensation?

Yes. Veterans receiving VA disability compensation can use Texas DPA programs. Additionally, disabled veterans are exempt from the VA funding fee, saving thousands of dollars.

What closing costs does VA DPA cover?

Texas DPA can cover a wide range of closing costs including:

Origination fees
Title insurance
Escrow setup
Recording fees
Survey costs
VA funding fee (if not financed)
Prepaid taxes and insurance

Can my spouse's income count if they are not a veteran?

Yes. Non-veteran spouses can be co-borrowers on VA loans. Their income counts toward qualification, and both incomes are considered for DPA income limits. However, if a non-veteran spouse is the only borrower, VA loan benefits do not apply.

Special Considerations for Texas Veterans

Texas Veterans Land Board Programs

The Texas Veterans Land Board (VLB) offers additional programs that may complement TSAHC DPA, including:

Veterans Housing Assistance Program (VHAP) - Up to $726,200 home loans
Veterans Land Loan - Financing for land purchases

These programs have different eligibility requirements than TSAHC/TDHCA programs. Your loan officer can help determine the best combination for your situation.

Disabled Veteran Property Tax Exemptions

Texas veterans with service-connected disabilities may qualify for property tax exemptions ranging from partial exemption to 100% exemption for totally disabled veterans. This can save thousands of dollars annually on top of your DPA benefits.

Ready to Get Started?

Texas veterans can stack real advantages: VA loans with no down payment requirement, TSAHC grants that never need to be repaid (paired with somewhat higher first-mortgage pricing), and no monthly mortgage insurance. Together, they can sharply cut the cash you need to buy.

Check your eligibility today with our free qualifier quiz, or contact us directly to speak with a VA loan and DPA specialist.

Tanner Cook - NMLS #2090424 - (469) 405-2690
Zac Cook - NMLS #2111496 - (469) 405-2690

Tanner Cook is a licensed mortgage loan originator (NMLS #2090424) with Cook Brothers Mortgage Team at Cornerstone First Mortgage (NMLS #173855). This content is for informational purposes only and does not constitute financial advice. Loan approval is subject to credit and property qualification. Equal Housing Lender.