First-Time Homebuyer Programs in Arizona

Buying your first home is an exciting milestone, but it can also be a daunting process. Fortunately, if you’re a first-time homebuyer in Arizona, there are several programs designed to make the journey smoother and more affordable. These programs offer financial assistance, down payment aid, and even favorable loan terms to help you step into homeownership with confidence. Here’s a guide to some of the key first-time homebuyer programs available in Arizona.

1. Home Plus Program

The Home Plus program is one of Arizona’s most popular options for first-time homebuyers. This program offers down payment assistance (DPA) in the form of a grant that does not have to be repaid. The grant can cover up to 5% of the loan amount, which can be used for the down payment or closing costs.

Eligibility Requirements:

• Must have a credit score of at least 640.
• Income limits apply, depending on the county and household size.
• Must complete a homebuyer education course.

The Home Plus program is available for FHA, VA, USDA, and conventional loan types, making it flexible for various homebuyer needs.

2. Pathway to Purchase Program

The Pathway to Purchase program offers down payment assistance to homebuyers in targeted cities across Arizona. This program provides up to 10% of the home’s purchase price in the form of a deferred, forgivable second mortgage.

Eligibility Requirements:

• Minimum credit score of 640.
• Income limits apply.
• Must purchase in one of the 17 targeted cities in Arizona.
• Must occupy the home as a primary residence.

The assistance provided through this program is forgivable after five years, making it an excellent option for those planning to stay in their new home long-term.

3. Mortgage Credit Certificate (MCC) Program

The Mortgage Credit Certificate (MCC) program provides a dollar-for-dollar tax credit that can help first-time homebuyers in Arizona save on their federal taxes. This credit is equal to a portion of the mortgage interest paid annually, which can significantly reduce your tax burden.

Eligibility Requirements:

• Must be a first-time homebuyer or not have owned a home in the past three years.
• Must meet income and purchase price limits.
• Must occupy the home as a primary residence.
• Must apply for the MCC at the time of purchase.

The MCC can be combined with other loan programs, making it a versatile option for those looking to maximize their savings.

4. USDA Rural Development Loan

For those considering homes in rural areas, the USDA Rural Development Loan is a fantastic option. This loan offers 100% financing, meaning no down payment is required, which can be a huge advantage for first-time buyers.

Eligibility Requirements:

• Property must be in a USDA-eligible rural area.
• Income limits apply.
• Must meet credit and employment requirements.
• Must occupy the home as a primary residence.

This program is ideal for buyers interested in living outside of urban areas and offers competitive interest rates.

5. FHA Loan

The Federal Housing Administration (FHA) loan is a popular choice for first-time homebuyers due to its low down payment requirements and flexible credit score standards. With an FHA loan, you can put down as little as 3.5%, making it easier to purchase your first home.

Eligibility Requirements:

• Minimum credit score of 580 for a 3.5% down payment; scores between 500-579 require a 10% down payment.
• Must have a debt-to-income ratio that meets lender guidelines.
• Must occupy the home as a primary residence.

FHA loans are widely available and can be combined with down payment assistance programs like Home Plus.

Final Thoughts

Arizona’s first-time homebuyer programs offer a variety of ways to make purchasing your first home more affordable. Whether you need help with a down payment, want to take advantage of tax credits, or are looking for a loan with favorable terms, there’s likely a program that can meet your needs. By exploring these options, you can take a confident step toward achieving your dream of homeownership.

Get Started

If you’re interested in any of these programs, the first step is to speak with a knowledgeable mortgage lender who can guide you through the application process and help determine which program is the best fit for your situation. We have a team of trusted lenders ready to give you a hand, if you’re ready to get started or have more questions, feel free to reach out to one of our real estate professionals. We’re here to help you navigate the process and find the perfect home for you.