Home Mortgage and Refinancing Rates in Austin

On July 13, 2022, current rates in Texas are 5.67% for a 30-year fixed, 4.91% for a 15-year fixed, and 4.38% for a 5/1 adjustable-rate mortgage (ARM).

Texas mortgage overview

Known for its warm weather and diverse population, Texas is the second-most populous state in the country. The Lone Star State is attracting new residents at a dizzying pace: In 2021, Texas had the largest population growth of any state, according to Census estimates.

If you’re looking to get a mortgage in Texas, you have several options.

·      Texas Conventional Mortgages: To qualify for a conventional mortgage, you’ll generally need a minimum credit score of 620 and a debt-to-income (DTI) ratio of less than 45 percent. If you make a down payment of less than 20 percent, you’ll need to pay private mortgage insurance (PMI), as well.

·         Texas FHA Loans: If your credit history disqualifies you from a conventional mortgage, you might be able to secure a loan insured by the Federal Housing Administration (FHA). A credit score of at least 580 can help you secure an FHA loan with a down payment of just 3.5 percent. You can still get an FHA loan with a credit score of 500, but that requires a 10 percent down payment. With an FHA loan, you’ll typically need a DTI between 31 percent to 41 percent. FHA loans generally have lower interest rates than conventional loans.

·         Texas VA Loans: If you’re a veteran or active duty member of the military, you may qualify for a mortgage-backed by the Department of Veterans Affairs (VA). A VA loan doesn’t require a down payment or private mortgage insurance (PMI), but you do need to pay a funding fee, which typically ranges from 2.3 percent to 3.6 percent of the purchase price.                                                                

Top 5 Bank-rate mortgage lenders in Texas

·         Better.com

·         Tomo

·         Watermark Home Loans

·         Fairway Independent Mortgage Corporation

·         Lower

First-time homebuyer programs in Texas

If you’re looking to purchase your first home in the Lone Star State, you have access to several first-time homebuyer programs. Most help buyers who haven’t owned a home in the past three years. Learn more about Texas first-time homebuyer programs.

·         My first Texas Home: Managed by the Texas Department of Housing and Community Affairs (TDHCA), the My First Texas Home program offers mortgages designed with smaller monthly payments. The program also provides small loans to help homebuyers cover down payments and closing costs. These can be worth up to 5 percent of your mortgage. You can find a participating lender online

·         Home Sweet Texas Home Loan Program: You don’t need to be a first-time homebuyer to take advantage of the Homes Sweet Texas Home Loan program, which offers 30-year fixed-rate mortgages and down-payment assistance grants worth up to 5 percent of the loan amount. You don’t need to pay the grants back, but you do need to meet certain income limits, which vary by county. You can find a participating lender online.

·         Home for Texas Heroes Home Loan Program: The Homes for Texas Heroes Home Loan Program is open to police officers, veterans, teachers, corrections officers, and emergency medical services personnel. The benefits are the same as those in the Homes Sweet Texas Home Loan Program.

·         TSAHC Mortgage Credit Certificates: Mortgage credit certificates offered by the Texas State Affordable Housing Corporation (TSAHC) let you take tax credits based on how much you pay in interest on your mortgage each year. You can calculate your savings here: 

Texas mortgage refinancing

With interest rates still low by historical standards, you might be able to lower your monthly payment and save thousands by refinancing your loan to a lower rate. You can use Bank-rates mortgage refinance calculator to see how much you can save.

Texas mortgage resources

- Texas first-time homebuyer resources

- Texas loan limits by county