Programs
They are not all worth your time, and Brad is the first to say so. These are the families they fall into, what each one is actually built for, and where the catch usually sits.
Everything on this page is general education, not a commitment to lend and not advice about your situation. No rates, income limits or credit thresholds appear here on purpose — they change constantly and a web page cannot be trusted to be current about them. Brad covers the live numbers on the class, where he can date them. Program terms vary by lender, by area and by individual qualification. Full disclosures and licensing.
State
The two state programs. Brad calls them twins. They provide down payment assistance as a share of the sale price rather than a flat cheque, and they usually arrive as a second lien that is either forgiven after a few years or carried at no interest.
Where the catch is
Assistance almost always nudges the interest rate on the first mortgage up. Whether that trade is worth it depends on how long you intend to stay.
Stacks on top
A separate bolt-on rather than a programme of its own. It costs a percentage of the loan up front and returns a credit against your federal income tax for a period of years.
Where the catch is
It only does anything for you if you actually owe federal income tax. If you have never written a cheque to the IRS, it is not your programme.
Loophole
A zero-down programme with notably inexpensive mortgage insurance, intended for rural buyers. Brad flags it as a loophole programme for one reason: eligibility is decided by a map, and the map is old.
Where the catch is
Towns on the outer ring of a metro can still sit inside the boundary the map remembers rather than the one that exists now. The map is redrawn annually, so eligible areas do disappear.
Veterans
The VA loan is zero down with no monthly mortgage insurance. The Texas Veterans Land Board runs a separate programme that will finance bare land, which almost nothing else will.
Where the catch is
Two quirks on the VA side. You generally cannot borrow with a co-buyer who is not your spouse or another entitled veteran, and the funding fee is rolled into the loan, which some lenders are quieter about than they should be.
Private
Some banks run zero-down programs that exist because of the Community Reinvestment Act, and eligibility is decided by census area rather than by income. Brad calls one of these his favourite programme in Texas.
Where the catch is
Almost nobody advertises them, and the reason is not mysterious. As he puts it, the programme exists on a piece of paper in a drawer somewhere, because the bank does not make much money on it.
New
Several Texas builders now run their own zero-down programs through lenders they own or partner with. Brad describes it as a war that broke out between builders inside the last year.
Where the catch is
Credit standards on these can be tighter than the headline suggests, and the offer is tied to that builder's inventory. It is a good deal on their house, not on any house.
Yours already
Brad's name for it is the secret ninja do-it-yourself down payment assistance programme, and it is your own 401(k). Most plans will let you borrow against a portion of it as a loan to yourself rather than a withdrawal.
Where the catch is
🔴 This one has real consequences and different rules per plan. An unrepaid loan can become a taxable distribution with a penalty. Talk to your plan administrator and a tax adviser before going near it. Teacher retirement plans generally will not permit it at all.
It takes about fifteen minutes to work out, and almost nobody has ever had it done for them.
