Texas is making $255 million in homebuyer funds available to Texans for the purchase of a home.

“Owning a home has always been an essential part of the American Dream. For families, home ownership is not merely a source of pride, it is often the first step on the path to prosperity. And for our communities, home ownership provides an important source of stability,” Governor Rick Perry said.

“Research studies show that when a majority of families own the home in which they live, you end up with safer neighborhoods, greater economic opportunities and a stronger sense of community.”

The Texas Department of Housing and Community Affairs (TDHCA) will release $240 million in low interest home loans, with approximately $180 million dedicated to purchases in the Hurricane Rita Gulf Opportunity Zone. Borrowers in the Opportunity Zone will pay a low interest rate of 5.875%. They will be allowed up to 5% of the purchase amount through grants for down payment assistance.

The Opportunity Zone residents do not have to be first time home buyers.

There are two loan options for those who purchase outside of the Zone area. The first is an unassisted loan that offers no added funds for down payment and closing costs. The other is an assisted loan with funds offered for down payment and closing costs.

The interest rates outside of the Zone range from 5.625% for unassisted loans to 6.125% for assisted loans.

The TDHCA will put the remaining $15 million into the Mortgage Credit Certificate Program. These certificates are available to eligible homeowners through the First Time Home Buyer Program.

“Today’s announcement represents the best opportunity for many low to moderate income Texans to achieve their dream of home ownership,” said TDHCA Executive Director, Michael Gerber.

“With 35 lenders participating in our programs, operating more than 300 branch offices throughout the state, Texans everywhere have a chance to begin to make a better future for themselves and their family. We encourage anyone interested in buying a home to learn how they can be a part of this initiative.”