The Statewide Guide
No state income tax, but higher property taxes. Constitutional rules on home equity found nowhere else. Loan limits that change by county. Texas rewards borrowers who understand its rules — and this is the guide, from a broker licensed across all 254 counties.
The lay of the land
Texas is the second-largest housing market in America, and it runs on its own rules. The state's growth story — corporate relocations, no income tax, land to build on — keeps demand strong from the Panhandle to the border, but what a buyer pays and how they borrow varies dramatically between a Hill Country acreage, an Austin tech-corridor home, and a Dallas suburb.
Two structural facts shape almost every Texas mortgage. First, the tax trade: Texas has no state income tax and funds itself heavily through property taxes, which rank among the nation's highest. That pushes monthly escrow up and directly affects how much home a lender says you can afford — a reality out-of-state buyers consistently underestimate.
Second, the Texas Constitution itself regulates home equity lending. Article XVI, Section 50(a)(6) sets borrower protections — an 80% equity cap, waiting periods, closing rules — that exist in no other state. Whether you're buying, refinancing with cash out, or opening a HELOC, those rules shape what's possible. We work inside them every day, and this guide links to plain-English breakdowns of each.
Texas at a glance
Start with the loan
Wherever you are in the state, the right structure depends on your situation. Each guide below is written for how that loan actually works in Texas.
The Texas rulebook
These aren't trivia — each one changes real numbers on real loans. Understanding them is the difference between being surprised at closing and negotiating from strength.
No state income tax means property taxes do the heavy lifting — and your monthly escrow shows it. Two identical incomes qualify for different loan amounts in Texas versus low-property-tax states, because PITI includes those taxes.
Cash-out refinances and HELOCs on your homestead are governed by the Texas Constitution: 80% combined loan-to-value cap, a 12-day waiting period, closing-location rules, and non-recourse protection. No other state has this.
Many newer Texas developments sit in Municipal Utility Districts or Public Improvement Districts that levy additional taxes to fund infrastructure. They can add meaningfully to your effective rate — always check before you offer.
Texas homeowners can exempt part of their primary home's value from property taxation and gain legal protections. Filing it is free and frequently missed by new arrivals — we remind every buyer.
Here is a fact that surprises people: no Texas county qualifies as high-cost. For 2026 the conforming limit is $832,750 everywhere in the state, so the jumbo threshold is uniform. FHA is different — its limits do vary by county, from the $541,287 Texas floor up to $571,550 in the Austin metro.
TDHCA's My First Texas Home and TSAHC's programs offer assistance and credits for eligible buyers — stackable with FHA and conventional loans. Statewide tools that too few buyers use.
Go local
Statewide license, local depth. Each market guide covers that area's counties, taxes, and loan realities.
This page is reviewed by Jonathan Sarver, a licensed Texas loan officer. Have a question about your specific situation in Austin or the Hill Country? Reach out directly — a real person, licensed in Texas, will answer.
Answers
Texas has no state income tax, so local property taxes fund schools, counties, and municipal services instead. Effective rates rank among the nation's highest and vary by county and district. For your mortgage, this matters because property taxes sit inside your monthly escrow payment — they directly affect how much home you qualify for.
Section 50(a)(6) of the Texas Constitution governs loans against the equity in your primary home — cash-out refinances and HELOCs. It caps total homestead debt at 80% of value, requires a 12-day waiting period, restricts where closings happen, and makes the loans non-recourse. It applies whenever you pull equity from your homestead; a straight rate-and-term refinance is not covered by it.
Municipal Utility Districts and Public Improvement Districts are special districts, common in newer Texas developments, that levy additional property taxes to repay infrastructure like water, sewer, and roads. They can add meaningfully to a property's total tax rate — and two similar homes a street apart can carry very different tax bills. We flag district taxes when we prequalify you.
Yes. The Texas Department of Housing and Community Affairs (TDHCA) offers My First Texas Home, and the Texas State Affordable Housing Corporation (TSAHC) offers down payment assistance and mortgage credit certificates for eligible buyers. These can pair with FHA, VA, and conventional loans — we'll check what you qualify for.
No. Conforming and FHA loan limits are set annually for each county. Most Texas counties use the national baseline, while higher-cost counties are set above it. The limit where you're buying determines when your loan becomes jumbo — we confirm your county's current figure as part of prequalification.
Yes — we're licensed for the entire state, all 254 counties. Our home base is the Hill Country outside Austin, and our market guides go deepest where we live, but the same licensing, loan options, and service cover a purchase in El Paso as much as one in Lakeway.
Statewide license, local answers
Wherever in the state you're buying or refinancing, get straight answers from a licensed Texas loan officer who works these rules every day.
Talk to a Texas brokerThis is not a commitment to lend. All loans subject to credit approval, income and asset verification, and property appraisal. Rates and terms vary and are not guaranteed.