Arizona Down Payment Assistance and First-Time Homebuyer Programs

Arizona, or “The Grand Canyon State,” is the sixth-largest and 14th most populous of all 50 U.S. states. Famous for its deep canyons, high- and low-elevation deserts, natural rock formations, and volcanic ranges, Arizona offers a vibrant landscape and several attractions for guests and residents.

However, the housing landscape isn’t exactly as friendly as the scenery, particularly for millennials looking to buy their first home. Housing affordability in Arizona has fallen significantly since the pandemic, with 32.5% of affordable houses sold now, compared to 71.2% pre pandemic. A major contributing factor to this trend is high mortgage interest rates, which makes it more difficult for residents within the median income limit to afford a home.

While several solutions have been proffered to ease the housing crisis in Arizona, the most apparent choice remains down payment assistance programs for first-time homebuyers. Thankfully, the Arizona Department of Housing (ADOH), as well as different cities, provide residents with assistance and the opportunity to buy in on the American Dream.

Looking for assistance in a specific part of Arizona?

This page provides an overview of the assistance programs available to first-time homebuyers in Arizona, covering statewide and local resources. For specific information on down payment assistance in your area, refer to the local resource provided here:

• Pima County of Tucson
• Maricopa County
• Arizona City
• Avondale
• Buckeye
• Casa Grande
• Coolidge
• Douglas
• El Mirage
• Fort Mohave
• Goodyear
• Huachuca City
• Laveen
• Maricopa
• Red Rock
• Sierra Vista
• Snowflake
• Yuma
• Phoenix

Down payment assistance in Arizona

Arizona seeks to implement deliberate policies to solve the housing crisis, from expediting zoning and approval processes to developing statewide zoning definitions and helping cities fund more affordable housing. Stairs Financial offers insight into some of these affordable housing programs, providing relevant information for residents to choose the ideal option. 

Home Plus Home Buyer Down Payment Assistance Program

The Arizona HOME Plus Homebuyer Down Payment Assistance Program is a statewide initiative aimed at helping creditworthy renters who qualify for a mortgage but struggle with the downpayment and closing costs associated with homeownership. The HOME+Plus program provides a 30-year fixed-rate mortgage that can be used toward the down payment, closing costs, or a combination of both.

Assistance type: Fixed-Rate Mortgage

Sponsor: Arizona Industrial Development Authority (AzIDA)

Assistance amount: 4% of the home’s purchase price

Eligibility requirements

• The borrower’s annual income must not exceed $112,785.
• All applicants must have a minimum credit score of 640 or better.
• One borrower must complete a homebuyer education course before closing.

The Chenoa Fund Down Payment Assistance Program

The Chenoa Fund Down Payment Assistance program is another statewide initiative that offers 3.5% of the purchase price towards down payments throughout Arizona. This program helps individuals or families in need of down payment assistance but lacks a high credit score that other assistance programs require.

Assistance type: Forgivable Loan

Sponsor: CBC Mortgage Agency (CBCMA)

Assistance amount: 3.5% of the purchase price

Purchase price limit: $280,880

Eligibility requirements

• Applicants do not need to be first-time homebuyers, but they cannot own another home to qualify for the program.
• Buyers must have a minimum FICO score of 620.
• The program may only be used to purchase a home, with no refinancing.

Tucson HOME Down Payment Assistance Program – WISH

Tucson, the county seat of Pima County, is Arizona’s second-largest city, renowned for its breathtaking desert landscapes. Located in the Sonoran Desert, the city features stunning vistas, including all cacti, rugged mountains, and a range of unique flora and fauna that make it ideal to work and live.

The Family Housing Resource (FHR) of Arizona provides Tucson residents the opportunity to own an affordable home through the HOME Down Payment Assistance Program. This program helps prospective homebuyers with the substantial upfront costs associated with most mortgage transactions.

Assistance type: Forgivable Loans

Sponsor: Family Housing Resource (FHR) of Arizona.

Assistance amount: Up to $29,000 or four times the amount of the homebuyer’s contribution.

Minimum borrower contribution: $2,000

Eligibility requirements

• All applicants must have a debt-to-income ratio no higher than 45%, and their liquid assets must not exceed $10,000.
• Homebuyers must not owe any money to the City of Tucson and must have at least one month’s mortgage payment at closing.
• Applicants must also complete FHR’s Homebuyer Education Class.

Maricopa County Home in Five Advantage Program

Maricopa County ranks as one of the largest counties in the United States in terms of land area, exceeding that of four entire US states. It’s also Arizona’s most populous and fastest-growing county, with about four and a half million people calling this county home, more than half of the entire population of Arizona.

Residents of Maricopa County can overcome the stress of large upfront payments associated with mortgage transactions with the Home in Five Advantage Program. This program helps low- and moderate-income individuals and families become homeowners with downpayment and closing cost assistance.

Assistance type: Forgivable Loans

Sponsor: Maricopa County

Assistance amount: 5% assistance for downpayment and closing costs; qualified applicants get 1% more.

Minimum borrower contribution: $1,000

Eligibility requirements

• Applicants must have a minimum FICO credit score of 640.
• Applicants must occupy the home as their principal residence within 60 days of closing.
• The program can be used only for new or existing houses, condominiums, or townhouses; funds cannot be used for refinancing.

Pathway to Purchase Down Payment Assistance

The Pathway to Purchase Down Payment Assistance Program provides prospective homebuyers with a maximum of $20,000 towards their downpayment and closing costs. This program is an initiative of the Arizona Department of Housing and assists residents in 17 cities, including Arizona City, Avondale, Buckeye, Casa Grande, Coolidge, Douglas, El Mirage, Fort Mohave, Goodyear, Huachuca City, Laveen, Maricopa, Red Rock, Sierra Vista, Snowflake, Tucson, and Yuma.

Assistance type: Deferred Payment Loans

Sponsor: Arizona Department of Housing

Assistance amount: 10% of the loan amount up to a maximum of $20,000.

Purchase price limit: $371,936

Eligibility requirements

• Buyers must have a minimum FICO score of 640 and a maximum 45% debt-to-income (DTI) ratio.
• All buyers must attend a homebuyer education course, obtain a certificate of completion, and receive a home inspection.
• You cannot own another home to qualify for this program, but you do not need to be a first-time homebuyer.

Phoenix Housing Assistance Program

Phoenix, the capital city and cultural center of Arizona, is known for its hot desert climate, mainly due to its proximity to the Sonoran Desert. However, as the sixth-largest city in the country, it also offers a stunning urban landscape, southwest culture, and several outdoor engagements. Phoenix also provides ample job opportunities, giving rise to new workers and residents within the city.

The Open Doors Down Payment Assistance Program aims to support qualifying first-time homebuyers in acquiring an affordable home within the City of Phoenix. The program offers financial aid for downpayment and closing costs to households with income below 80% of the Area Median Income (AMI)

Assistance type: Deferred Payment Loans

Sponsor: Phoenix Housing

Assistance amount: 10% of the purchase price.

Purchase price limit: $428,000

Minimum borrower contribution: $1,000

Eligibility requirements

• Applicants must be first-time homebuyers as defined by FHA
• Applicants must own and occupy the property as their primary residence for the loan term.
• Homebuyers must also participate in pre-purchase homebuyer education and counseling.

Arizona down payment assistance program FAQs

Here are some common questions from first-time homebuyers in Arizona seeking assistance with down payments.

Does Arizona have a first-time buyer program?

Certainly! Arizona offers several programs to assist first-time homebuyers, including the HOME+Plus Program, the Chenoa Fund Down Payment Assistance, and Pathway to Purchase Down Payment Assistance, available in 17 cities.

How to buy a house for the first time in Arizona?

As an Arizona resident purchasing your first home, you’ll encounter various avenues to explore. Generally, prospective homebuyers should grasp their financial situation by assessing their income, expenses, savings, and credit score. These metrics also help to determine the monthly mortgage payment.

Mortgage and down payment assistance programs are crucial for first-time homebuyers. You can take advantage of Stairs FInancial’s thorough resources on Arizona’s first-time homebuyer assistance programs to understand the eligibility criteria and select the most suitable option.

What is the minimum down payment in Arizona?

The minimum downpayment in Arizona for first-time homebuyers is 3% for conventional loans and about 3.5% for FHA loans. Other options like the VA and USDA loans can offer a zero down payment option.

Can you get Biden first-time home buyer assistance in Arizona?

The Biden first-time homebuyer assistance program remains a bill under consideration by the 2023-2024 Congress and has yet to be enacted into law. Nonetheless, national initiatives such as the Mortgage Relief Credit and Down Payment Assistance for First-Generation Homeowners will be accessible in Arizona upon implementation.

What type of Arizona first-time homebuyer assistance is available?

Most first-time homebuyer assistance programs in Arizona are in the form of grants, deferred payments, and forgivable loans. However, these loans are only forgiven when specific criteria are satisfied.

What is the Arizona first-time homebuyer income limit?

The income limit for down payment assistance for first-time homebuyers in Arizona is 80% of each city’s median income (AMI). However, it may also rise to 120% for some programs; hence, you should always check the latest guidelines.

What are some requirements for first-time home buyers in Arizona?

Some standard requirements for first-time homebuyers in Arizona include;

• Applicants should have a minimum credit score of 640.
• The minimum debt-to-income (DTI) ratio is typically between 45% to 50%, depending on the loan type.
• Buyers must complete a homebuyer education course.

How do I qualify for Arizona’s first-time home buyer programs?

Aside from not owning a home in the last three years, the primary qualifying criterion for these programs is the deal’s financials, including credit score, household income, and purchase price limit.

Disclaimer: This article is for informational purposes only and should not be considered as legal or financial advice. Please consult an attorney, mortgage lender, or CPA for guidance on your specific situation.