Mallett will receive the guaranteed money in the first year of the contract, according to the source.
If Hoyer joins Houston, he likely would be in a competition for the starting job with Mallett, who started two games last season for the Texans. One of those starts ended in a win against the Cleveland Browns; his other start was a loss to the Cincinnati Bengals, a game in which he played with a torn right pectoral muscle.
The Texans acquired Mallett in a trade with the New England Patriots on Aug. 31. Mallett had spent the first three seasons of his career with the Patriots, who selected him in the third round of the 2011 draft.
Mallett played behind Tom Brady in New England and never saw any meaningful snaps. Texans coach Bill O'Brien was the Patriots' offensive coordinator in 2011.
Mallett, who turns 27 in June, spent the first nine weeks of the 2014 season backing up Ryan Fitzpatrick, who went 4-5 during that time. At their bye week, the Texans opted to bench Fitzpatrick in favor of Mallett.
Both general manager Rick Smith and O'Brien said during the combine that they hoped to re-sign Mallett. They praised Mallett's study habits and said it was apparent he had learned from being Brady's teammate.