TDHCA and TSAHC rates, and why the number moves
The rate on a Texas assistance loan is set administratively rather than shopped, it moves, and the help you receive is priced into it. What decides the number, where the agencies publish today's, and the arithmetic that tells you whether the assistance is worth its rate.
What is the TDHCA or TSAHC rate today?
We do not publish it, and no page that quotes you a figure should be trusted for long. These rates change, they are set by the agencies rather than by us, and a number typed into an article is wrong the week after it is written. The agencies publish their own, and those are the pages to check. What this page is for is the part that does not change: who sets the number, why it sits where it does, and how to work out whether taking it is worth it.
- TDHCA publishes its current rates and a rate notice here: welcomehome.tdhca.texas.gov
- TSAHC's programs and their current terms are here: tsahc.org
- Neither page is a quote. Only a participating lender can tell you the rate you would actually be offered, and nothing here is a commitment to lend.
Who actually decides the rate?
Not a market, and this is the part that surprises people who assume an assistance loan is priced the way any other mortgage is. These are bond-funded state programmes, and the rate attached to them is set by the administering agency and published. Brad's description from a class is blunter than an agency would put it: "There is some bureaucrat sitting behind a desk, probably here in Austin, who is deciding what the interest rate is that day." The useful part of that is not the tone, it is the structural point underneath it. You are not shopping this rate. It is announced, and you either take it with the assistance attached or you do not.
Why would the assistance rate be higher than another rate I have been quoted?
Because the help is priced into it. Down payment assistance has to be paid for by something, and on these programmes it is generally paid for by the rate on the first mortgage rather than by a fee at closing. That is the trade, and it is the single most important thing to understand before comparing two offers. Brad puts the comparison this way, from his own experience rather than from any published table: "it's often higher than what you could take advantage of if we went and got a promotional rate with a builder, for example."
Which makes it an arithmetic question, not a loyalty one
Two offers are not comparable on rate alone when one of them hands you money at closing. The comparison that matters is what the assistance is worth to you now against what the higher rate costs you over the years you actually expect to keep the loan. A buyer who expects to refinance or move inside a few years is in a completely different position from one who intends to hold the loan, and the same programme can be the right answer for the first and the wrong one for the second.
- Ask any lender to quote you both ways: with the assistance and its rate, and without it at their own best rate.
- Compare the cash you receive at closing against the extra you pay each month, over a realistic number of years rather than the full thirty.
- Ask whether the assistance is forgivable or repayable, because a repayable second lien is not a gift and changes the arithmetic entirely.
TDHCA and TSAHC: two agencies, or one shape?
They present as separate and a practitioner treats them as one. Brad's working line is that "we're gonna lump TDHCA and TSAHC together because they're very, very similar. They're like two sides of the same coin." Both are Texas state-level bodies running a first mortgage with assistance attached, both publish their own terms, and both reach you through a participating lender rather than directly. The differences that matter to a buyer are which programmes each one runs and which lenders are approved for them, not a difference of kind.
| Agency | Programmes it runs | How the assistance is structured | Where it publishes terms |
|---|---|---|---|
| TDHCA, the state housing department | My First Texas Home, My Choice Texas Home, Texas Mortgage Credit Certificate | Second lien, deferred, either forgivable after a term or repayable on sale or refinance | welcomehome.tdhca.texas.gov |
| TSAHC, the state affordable housing corporation | Home Sweet Texas Home, Homes for Texas Heroes, TSAHC Mortgage Credit Certificate | Grant or deferred forgivable second lien, depending on the option taken | tsahc.org |
| Both | A mortgage credit certificate, separately from the loan | A federal tax credit rather than cash at closing, and only worth something if you owe federal income tax | each agency's own MCC page |
When does the assistance cost more than it gives?
When you do not keep the loan long enough for the money at closing to outweigh the rate you paid for it, or when the assistance turns out to be repayable rather than forgiven. Neither of those is a reason to avoid these programmes, and for a buyer who cannot otherwise reach a down payment the question is usually settled before it is asked. It is a reason to run the arithmetic with a lender who will quote you both ways, and to read which structure your assistance actually uses before you sign for it.
Where do I check today's number?
At the agency, and then with a participating lender. The agency page tells you what is being offered; only a lender can tell you what you would be offered, because that depends on your file. If you want the list narrowed before you make that call, the free class covers which of the programmes are worth your time for your county and your situation, and there is nothing to buy at the end of it.
- TDHCA current rates and rate notice: welcomehome.tdhca.texas.gov
- TSAHC loans and down payment assistance: tsahc.org
- TSAHC Home Sweet Texas Home: tsahc.org
- TSAHC Homes for Texas Heroes: tsahc.org
Want this checked against your own situation?
The free class covers the whole picture in 45 minutes. Or take two minutes and see which programs are worth a look for someone in your position.