City of Laredo

Down Payment Assistance


City of Laredo Down Payment Assistance Program

Location Served: Laredo, TX

Provider: City of Laredo

To inquire if New American Funding is currently an approved lender for this DPA program, please call (512) 524-8077. This webpage is for information purposes only.



Down Payment Assistance Program

The City of Laredo has created the down payment assistance program (DPA) to offer first-time homebuyers with lower incomes an opportunity to receive down payment loans.
For households with incomes of up to 60% of housing area median family income, loans are provided for up to $15,000.
For households with incomes above 60% and up to 70% of the housing area median family income, loans of up to $12,000 are provided.
For households with incomes above 70% and up to 80% of the housing area median family income, loans of up to $9,000 are provided.
The Laredo DPA loans bear a 0% interest on the principal amount and they are due after the first lien is paid completely (typically 30 years) or upon sale of the real estate property. The City of Laredo will subordinate its second lien if a homebuyer decides to refinance their existing mortgage and the structure of the loan remains the same.
There are no prepayment penalties for this program.

Eligibility Criteria


  • 80% of the area’s median family income as per HUD Section 8 Program Income Guidelines (updated annually) must not be exceeded by the family income of the applicant(s).

  • This program is for first-time homebuyers only. Exceptions include: displaced homemakers and single parents.

  • Prior to being assisted with HOME funds through this program, applican(s) must have lived within the city limits of Laredo at least 6 months.

  • Valid earnest money contract required.

  • Valid, preapproved conditional mortgage commitment required. Also, the applicant(s) must have a letter from the mortgage lender stating the applicant(s) need for a down payment and the lack of affordability for the applicant.

  • Two-year employment history required.

  • Mortgage lender must approve the applicant’s creditworthiness. Please note: the minimum credit score requirement to participate in this program with a New American Funding mortgage lender is 640.

  • Primary residences only.


Down Payment Assistance Loan Terms


  • The Department of Community Development Director gives final approval on all applications, which are processed on a first-come, first-serve basis.

  • This program recommends applicant(s) make a $1,000 minimum investment.

  • Completion of the Homebuyer Education Course Program required.

  • Existing homes and newly constructed homes only.

  • Lead based paint testing required for all existing homes built prior to 1978. This testing is the responsibility of the seller. The Department of Community Development requires proper documents attesting to the lead hazard clearance.

  • HUD’s section 203 (b) guidelines set the property value limitation.

  • The property being purchased will have a recorded second Lien Deed of Trust and Real Estate Lien.

  • Regarding the unit’s affordability, the borrowers will comply with the binding commitments.


All eligible applicants are welcomed to participate in the Home Investment Partnerships Program (HOME) First-Time Homebuyer Down Payment Assistance Program (DPAP) for the City of Laredo. The goal of this program is to provide individuals and families who have not owned a home three years prior and are of low to moderate income levels with assistance to buy a home.

If you have any additional questions regarding home mortgages, please contact a mortgage expert by filling out the form on the right or calling (512) 524-8077. You can also email

This website marketing is not intended to offer loan services for properties in New York.