Texas Mortgage Guide: Everything You Need to Know in 2026

By RealMortgage Team

Key Takeaways

  • Texas offers advantages like no state income tax, strong job markets, and robust homestead protections for homeowners.
  • Unique Texas mortgage rules include limitations on home equity loans (80% LTV, 12-day cooling-off period) and higher-than-average property taxes.
  • State programs like TDHCA My First Texas Home and My Choice Texas Home provide 30-year fixed-rate mortgages and down payment assistance.
  • Major Texas cities like Houston, Dallas, and Austin have distinct housing markets influenced by specific industries and growth patterns.

Texas Mortgage Guide: Everything You Need to Know in 2026

Texas stands out as one of the most attractive states for homebuyers, offering no state income tax, strong job markets, and relatively affordable housing. Here's what you need to know about getting a mortgage in the Lone Star State.

Why Buy in Texas?

  • No state income tax — More of your income goes toward your mortgage
  • Affordable housing — Median prices below the national average in many metros
  • Booming job markets — Houston, Dallas, Austin, and San Antonio lead in job creation
  • Strong homestead protections — Texas law protects your home from most creditors

Texas-Specific Mortgage Rules

Texas has unique mortgage regulations you should know:

Home Equity Loans (Texas Section 50(a)(6)):

  • Limited to 80% of your home's fair market value
  • 12-day cooling-off period required
  • Only one home equity loan at a time
  • Must close at a title company or attorney's office

Property Taxes:

Texas has no state income tax, but property taxes are higher than the national average (approximately 1.6-2.2% depending on the county). This significantly affects your monthly payment, so factor it into your budget.

Best Programs for Texas Homebuyers

TDHCA My First Texas Home:

  • 30-year fixed-rate mortgage
  • Down payment assistance up to 5%
  • Available to first-time and repeat buyers

TDHCA My Choice Texas Home:

  • For repeat buyers who don't qualify for first-time programs
  • Down payment assistance available

City-by-City Breakdown

Houston: Sprawling market with incredible variety. Energy sector jobs drive demand. See our Houston mortgage page.

Dallas-Fort Worth: One of the fastest-growing metros in the US. Corporate relocations fuel the market. See our Dallas mortgage page.

Austin: Tech hub with rising prices but strong appreciation potential. See our Austin mortgage page.

Getting Started

RealMortgage is licensed in Texas and helps Lone Star buyers compare rates from 50+ lenders. Contact us for a free, no-obligation rate quote.

Frequently Asked Questions

What are the advantages of getting a mortgage in Texas?

Texas offers several advantages, including no state income tax, which can free up more income for mortgage payments. The state also boasts strong job markets and provides robust homestead protections, safeguarding your home from many creditors. These factors combine to make Texas an attractive option for homebuyers.

Does Texas have unique mortgage regulations?

Yes, Texas has specific regulations, particularly concerning home equity loans. These are limited to 80% of your home's fair market value, require a 12-day cooling-off period, and only one such loan can be active at a time. Property taxes are also higher than the national average, impacting monthly mortgage expenses.

Are there programs to help with down payments in Texas?

The Texas Department of Housing and Community Affairs (TDHCA) offers programs like 'My First Texas Home' and 'My Choice Texas Home.' These programs provide 30-year fixed-rate mortgages and down payment assistance, often up to 5%, for eligible first-time and repeat homebuyers across the state.