Prepare for your home-buying journey and secure your dream property
with these streamlined, step-by-step first-time home buyer guides.
Texas has a booming real estate market driven by several major metro areas. Even so, the median home price in mid 2026 sat at $343,779 — comfortably below the national average of $398,771.
It’s only natural to feel a bit intimidated by house hunting in the Lone Star State. But our Texas first-time homebuyer guide can help you navigate the important steps with confidence. Learn about local assistance programs, mortgage and down payment options, and much more.
HUD has a surprisingly broad definition of what is a first-time homebuyer. You qualify if you have not owned a primary residence in the past three years or have only owned a home with a spouse. This makes it possible for repeat buyers to fall into this category if they’ve been out of the ownership market for some time. Keep reading to find out why this is important.
If you qualify as a first-time homebuyer, the Texas Department of Housing and Community Affairs (TDHCA) offers a variety of programs to help lighten the financial load. The My First Texas Home Program can connect you with a low-interest, fixed-rate mortgage and down payment assistance of up to 5% of the primary loan amount. The My Choice Texas Home Program offers similar first-time homebuyer benefits to both new and repeat buyers.
The Home Sweet Texas Home Loan Program provides a 30-year loan with down payment assistance in the form of a grant or no-interest, no-payment second mortgage. Public servants can access the Homes for Texas Heroes down payment assistance program — designated for public school educators, first responders, public security officers, veterans or active military, nurses, and corrections officers — in the form of a forgivable loan. Eligibility for some of these programs requires completion of a homeowners education course, and each one has credit score minimums, debt-to-income ratio maximums, and income thresholds.
Anyone buying your first home can claim a Mortgage Credit Certificate, or MCC, which gives you a one-for-one credit on your federal taxes equal to 15% of the mortgage interest paid up to $2,000. Speak to your mortgage loan officer for guidance on which programs the lender accepts.
Compare current home interest rates by state and find a mortgage rate that suits your financial goals.
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House hunting takes patience and a game plan. Here’s a step-by-step roadmap to guide you from browsing to closing day.
Before you start browsing listings, take a close look at your finances. If local rent is outpacing what a monthly mortgage payment would cost, homeownership might be within reach.
This is the time to check on your credit score and debt-to-income ratio (DTI). Conventional loans require a 600+, but the higher your credit score, the lower the interest rates you’ll be offered. In other words, maintaining a strong credit profile can save you thousands.
Another key metric is your DTI, which is calculated by dividing your monthly debt payments (for credit cards, auto loans, student loans, etc.) by your gross income. You’ll need a DTI below 45% for a conventional loan, or 50% for a government-backed loan.
Finally, you’ll want to consider your long-term plans. Staying in your new home at least several years will allow your equity to grow through appreciation and monthly payments.
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A solid budget keeps your home search focused and prevents sticker shock later. Just remember to look beyond the purchase price and factor in upfront costs.
Conventional mortgages allow you to put down as little as 3% of the purchase price, and some government-backed mortgages require no down payment at all. Many homebuyers try to save 20% to avoid paying private mortgage insurance (PMI), but first-time buyers often put down much less. As you’re exploring down payment options, keep in mind that you’ll want to leave yourself a healthy emergency fund. A down payment calculator can help you figure out a target amount.
Another big piece of the puzzle is monthly housing costs. This includes not just your mortgage payment but also other charges that are sometimes rolled into your monthly bill, such as property tax, homeowners insurance, PMI, any homeowners association (HOA) fees, and a little left over for the inevitable maintenance issues that go along with homeownership. A home affordability calculator can help you understand what you can comfortably afford based on your income.
If you are moving from out of state, it’s also worth taking the time to research the local cost of living. It can vary greatly by state, so being prepared for any cost differences can save you financial stress later on.
Next, you’ll want to learn about the various types of mortgage loans to figure out which is best for your circumstances and credit profile. Regardless of which you choose, the components of a monthly payment are the same. The principal is the original amount you borrowed, while the interest is the fee the lender charges you for the loan.
Shopping around for a mortgage can save you thousands over the life of your loan. Getting quotes from at least three lenders is the best way to ensure you’re getting a competitive rate.
As you compare your offers, be sure to look at not just the interest rate but the APR (annual percentage rate). The APR includes interest plus lender fees and discount points, so it is a better reflection of true borrowing costs.
Beyond costs, take the time to evaluate a lender’s customer service and preapproval timelines.
It’s important to know the difference between prequalification vs. preapproval. Prequalification provides a rough calculation of what you can borrow based on self-reported, unverified information. You can get prequalified with multiple lenders as you shop around.
Preapproval requires the lender to verify your credit history, income, assets, and outstanding debts. During the mortgage preapproval process, you’ll submit financial documents, such as bank statements, pay stubs, tax returns, and investment records. Lenders conduct a hard credit check during this review, which can impact your credit score.
Having a preapproval letter is a major advantage when shopping for a house. It provides you with a definitive borrowing amount, and it demonstrates to home sellers that you are a serious shopper with financing. A mortgage preapproval letter is valid for 30-90 days, and certain institutions will lock your financing terms. This lock-in protects you from rising interest rates while you search.
Working with a real estate agent might feel optional, but having an expert on your side saves serious time and stress. An agent can tailor your home search, navigate complex paperwork, and provide personalized first-time homebuyer tips. They’ll have access to new listings, and sometimes even listings that aren’t on the public market. Your agent will handle contract negotiations and give you advice on the homes you’re looking at.
It’s a good idea to read up on how real estate commission fees have changed. Having a conversation up front keeps you and your agent on the same page.
Now the fun part begins: serious house hunting! Aside from the property itself, you’ll be evaluating neighborhoods, school districts, average commute times, and community safety. When you tour homes, remember that cosmetic issues, such as paint colors or landscaping, can be easily changed. Focus on functionality, and run a few faucets to test the water pressure. Look for signs of neglect such as water stains, uneven floors, or musty odors.
Once you’re seeing properties in person, it’s important to know your rights regarding housing discrimination. The Fair Housing Act prohibits discrimination based on race, color, national origin, religion, sex, familial status, and disability. If a professional steers you away from certain neighborhoods or obscures posting data, document the behavior with screenshots and dated notes.
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Once you find “the one,” it’s time to team up with your agent and put pen to paper with an official offer. This letter outlines your proposed purchase price, timeline, and contingencies. The latter are contract clauses that allow you to walk away under certain conditions, such as a poor home inspection (more on those below) or mortgage problem.
If the seller accepts your offer, you’ll proceed to the contract stage and submit an earnest money deposit. The earnest money deposit is a good-faith gesture to show you are serious about purchasing, and it is held in a neutral escrow account until closing, when it is applied to the down payment and closing costs.
Never skip the home inspection — it’s your best defense against hidden, costly surprises after you move in. The inspector examines the property structure, mechanical systems, roof, foundation, plumbing, electrical components, and heating systems for defects.
A standard inspection costs $300–$500, paid for by the buyer. If you can, attend the inspection yourself to ask questions and examine spaces directly. If the final report reveals structural issues or costly repairs, you can use the inspection contingency to renegotiate the sale price, request repairs, or walk away from the deal.
Your mortgage lender will require an appraisal to verify that the home’s value aligns with your loan amount. An appraisal differs from an inspection because it focuses on valuation rather than structural defects, and it protects the financial institution from loaning more money than the property is worth.
Your lender will select the appraiser at random to ensure objectivity. Your agent will schedule the appointment and coordinate access. The appraiser will then examine the property and analyze local market data to determine a value for your financing. You will be responsible for paying the cost of the appraisal, which typically falls into the $675-$800 range in Texas.
You’ve reached the finish line! Closing day is when all the paperwork becomes official and the keys finally change hands. You’ll receive a closing disclosure three business days before this meeting to review your finalized fees and terms.
Keep in mind that your lender will require proof of homeowners insurance before signing. Ensure your policy addresses environmental hazards specific to Texas, such as wind or flood damage.
An escrow company or closing agent coordinates the transfer of funds and records the legal deed with the county. You’ll do a final walk-through with your agent to confirm any agreed-upon repairs are complete. At the closing table, your agent, loan officer, and a title representative will guide you through signing the note, deed, and disclosure forms. Finally, you’ll pay closing costs, submit your down payment, and receive the keys.
An online calculator can be a big help in comparing home equity loan rates and terms. And it’s not the only calculator you’ll find helpful during your home equity loan process:
Enter a few details about your home loan and we’ll provide you your maximum home equity loan amount.
Punch in your HELOC amount and we’ll estimate your monthly payment amount for your HELOC.
Use SoFI’s HELOC interest calculator to estimate how much monthly interest you’ll pay.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
Successfully closing means you can celebrate becoming a homeowner. This first-time homebuyer checklist can help guide your transition from renting to owning.
Buying your first home in Texas is an exciting milestone that’s made easier when you prepare your finances and utilize financial assistance programs. A realistic budget and an experienced real estate agent allow you to navigate the mortgage lending process with confidence and find a property that feels like home.
The credit score needed for conventional loans is 620. FHA loans allow credit scores as low as 580 with a 3.5% down payment, or 500 with a 10% down payment. VA and USDA do not mandate an official minimum score, but the minimums are typically lower than for conventional mortgages.
Start the home-buying process by evaluating your personal finances, including credit score and debt-to-income ratio, to see what you can afford. Then, contact mortgage lenders to seek prequalification, which estimates your borrowing range, followed by formal preapproval. Finally, work with a real estate agent to start looking at homes.
The steps in the home-buying process include reviewing your finances, setting a budget, getting preapproved for a home loan, and finding a real estate agent. When you find a house you want, submit an offer. If it’s accepted, schedule a home inspection and property appraisal to satisfy lender requirements. Finally, secure homeowners insurance, and attend closing to sign documentation.
To start buying a house, you’ll need enough savings to cover a down payment (at least 3% of the purchase price for first-time buyers) and closing costs (2%-5% of the loan amount). You’ll also want to make sure your income covers not just the monthly mortgage payment but also property tax, homeowners insurance, private mortgage insurance, and any HOA fees.
When buying a house for the first time, remember that the list price is only the beginning of your financial commitment, which extends to closing fees, property tax, homeowners insurance, and ongoing maintenance. Your credit score impacts the interest rates you’re offered, so taking time building a strong credit profile will save you money over the long term. Finally, an experienced real estate agent can walk you through the process, negotiate on your behalf, and manage much of the paperwork.
This content is for educational and informational purposes only. The products, services, or features discussed may not currently be available via the SoFi platform. Any references to third-party products, services, or companies do not constitute an endorsement, recommendation, or solicitation by SoFi. Readers should independently evaluate their options and consider their individual financial needs and circumstances before making any decisions. ©2026 SoFi Technologies, Inc. All rights reserved.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
SOHL-Q226-065Take the first steps to homeownership today. Get prequalified for an FHA loan online.
