4 Misconceptions on DACA Mortgage Loans in Houston


DACA is a visa status that is offered to the ones who come to the United States at their childhood with their parents unlawfully. And after years, when they want to buy homes and apply for home loan programs, they face difficulties. It is because they are not lawful residents.

But with a DACA status, you can fulfill your dream of homeownership. But the misconceptions on DACA mortgage loans in Houston, can create doubts in your mind. Let’s debunk the myths –

  • Being a DACA Recipient, You Can’t Get Approval for a Traditional Loan

Well, this concept is not right. DACA recipient homebuyers can’t opt for government-backed home loan programs, such as FHA home loans or USDA loans. As DACA does not confirm lawful status, DACA recipient remains ineligible for this loan program.

But as there is no such guideline for traditional loans, you can easily apply for these loans. However, you have to fulfill the eligibility criteria like a 20% down payment, good credit score, etc. to get approval for a traditional home loan program.

  • With a Low Credit Score, You Can’t Get Approval

Partially true! It is not impossible to get approval for a home loan program with a low credit score, but it is always better to come with a high credit score as possible. Like any other home loan program, DACA lenders too want to know about the credit score of the borrower before approving the loan.

The credit requirements vary from a mortgage lender to another one. With low credit score, you can narrow down your possibility to apply to various lenders, as they would be skeptical about loan approval. Besides, with a low credit score, you may need to pay a high mortgage rate. To lower such a possibility, you should take steps to improve your credit score.

  • You Can’t Use Gift Money for Buying a Home

It is time to disclose the myth. Gift funds can apply to all or part of a down payment or closing costs. The only people who can give you gift funds are spouse or partner, children, dependents, or children.

In most cases, the person providing the needs to work with you or your mortgage consultants need to follow some steps or requirements. Follow the steps to use gift funds for buying a house.

  • Work History Is Not Mandatory

No, you will need a work history for getting approval for a home loan as a DACA recipient. And the amount of work history required is 2 years. Some homebuyers only have a couple of years of employment history because of their DACA status. However, there are several ways to get a mortgage even with a limited work history.

If you are not sure whether you can qualify for a mortgage loan based on your work history, get in touch with a reputable mortgage lender, and resolve your query.

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