First-Time Home Buyer Programs in Arkansas

Arkansas Development Finance Authority (ADFA) Programs:

StartSmart First-Time Homebuyer Loan Program:

Eligibility: Targets first-time homebuyers (no principal residence ownership in the past three years), except in 30 federally targeted counties or for veterans/spouses with documentation.
Offerings: Provides a 30-year fixed-rate mortgage (FHA, VA, USDA, or Freddie Mac HFA Advantage) at below-market interest rates, with no prepayment penalty.
Requirements:

• Minimum credit score of 640 (conventional) or per loan type guidelines.
• Maximum purchase price of $424,100.
• First-time buyers with conventional loans must complete a homebuyer education course.
• Must be an Arkansas resident and use the home as a primary residence.

ADFA Down Payment Assistance Program (DPA):

Benefits: Offers $1,000 to $15,000 for down payment and closing costs as a 10-year second mortgage at the same rate as the first mortgage; combinable with StartSmart or Move-Up.
Eligibility: Open to buyers using an ADFA first mortgage, with income limits varying by county and household size.

Arkansas Dream Down Payment Initiative (ADDI):

Description: Provides up to 10% of the purchase price (max $25,000) as a forgivable second mortgage for low-income buyers; forgiven after 5 years if $15,000 or less, or 10 years if above $15,000.
Requirements: Income must not exceed 80% of the area median income (AMI); must pair with an ADFA mortgage.

Local Programs:

Little Rock

Down Payment Assistance Program: Offers up to 6% of the purchase price (max $10,000) as a forgivable second loan over 5 years for low- to moderate-income first-time buyers; requires a homebuyer counseling course and city inspection.

Jonesboro

Homeownership Assistance Program: Provides grant assistance for down payment and closing costs for low- to moderate-income first-time buyers within city limits; must meet federal income guidelines and HUD housing standards.

Pine Bluff

Homebuyers Assistance Program: Offers up to $2,000 for down payment and $3,000 for closing costs to low- and moderate-income buyers; no first-time buyer requirement but prioritizes such applicants.

Additional Information:

• Mortgage Credit Certificate (MCC): Offers a tax credit of up to 35% of annual mortgage interest (max $2,000) for first-time buyers, veterans, or those in targeted areas when paired with an ADFA mortgage; check availability as funds may be limited.
• USDA and VA Loans: Zero-down payment options for rural areas (USDA) or veterans/active military (VA).
• FHA Loans: Minimum 3.5% down payment, suitable for credit scores as low as 580 (10% if below 580).