Arizona First-Time Home Buyer: 2024 Programs and Grants

What to know about buying a house in Arizona

Arizona offers plenty of assistance to first-time home buyers.

You may be in line for special mortgage programs and even home buyer education and counseling. Even better, the state has some generous down payment assistance programs that could help you bridge the gap between your savings and your down payment and closing costs needs.

Here’s how to get started.

In this article (Skip to ...)

• AZ home buyer overview
• Home loan options
• AZ home buyer programs
• First-time buyer grants
• Buying in Arizona’s cities
• Resources
• Arizona mortgage rates

Arizona home buyer overview

The median home sales price in Arizona was $442,900 in September 2024. That increased 1.8% year-over-year, according to Redfin.

Even though housing inflation is slowing, first-time home buyers in Arizona may still find saving for the down payment on a new home challenging. However, the Grand Canyon State provides plenty of help with homeownership assistance programs.

Arizona home buyer stats

Down payment amounts are based on the state's most recently available average home sale price. “Minimum” down payment assumes 3% down on a conventional mortgage with a minimum credit score of 620.

If you're eligible for a VA loan (backed by the Department of Veterans Affairs) or a USDA loan (backed by the US Department of Agriculture), you may not need any down payment at all.

First-time home buyer loans in Arizona

First-time home buyers with a 20% down payment in the state of Arizona can get a conventional loan with a low interest rate. And you never have to pay for private mortgage insurance (PMI).

Of course, few first-time buyers have saved enough for 20% down. But the good news is, you don’t need that much. Not by a long shot. Borrowers can often get into a new home with as little as 3% or even 0% down using one of these low-down-payment mortgage programs:

• Conventional 97: From Freddie Mac or Fannie Mae. 3% down payment and 620 minimum credit score. You can usually stop paying mortgage insurance after a few years
• FHA loan: Backed by the Federal Housing Administration. Eligibility requirements include 3.5% down and a 580 minimum credit score. But you’re on the hook for mortgage insurance premiums (MIP) until you refinance to a different type of mortgage, move, or pay off your loan
• VA loan: Only for veterans, active-duty military members, reservists, and National Guard. Zero down payment is required. Minimum credit score varies by lender but often 620. No ongoing mortgage insurance after closing. These are arguably the best mortgages available, so apply if you’re eligible
• USDA loan: For those on low-to-moderate incomes buying in designated rural areas. Zero down payment required. Credit score requirements vary by lender but often 640. Buyers must meet income limits, too, which vary by location and household size. Low mortgage insurance rates
• Home Plus AZ: May include a competitive interest rate and mortgage insurance package, and can be used with down payment assistance and closing cost assistance. More information below

Note that government loan programs (including FHA, VA, and USDA home loans) require you to buy a primary residence. That means you can’t use these loans for a vacation home or investment property.

In addition, most programs let you use gifted money or down payment assistance (DPA) to cover your down payment and closing costs. Depending on your mortgage loan, you could potentially get into a new house with minimal cash out of pocket.

If you’re unsure which program to choose for your first mortgage, your lender can help you find the right match based on your finances and home buying goals.

Arizona first-time home buyer programs

The Arizona Industrial Development Authority administers Home Plus AZ, which is a mortgage program open to Arizona first-time home buyers everywhere in the state.

The Home Plus program offers a 30-year fixed-rate mortgage that can be paired with down payment assistance of up to 5%. The Home Plus mortgage can be a conventional, FHA, VA or USDA loan. What’s more, it comes with discounted mortgage insurance to help keep your monthly payments low.

You’ll have to choose a lender from an approved list of partners and undertake a home buyer education course, but those are common requirements for such programs. As are income limits, which bar people with high household incomes from participating.

You may pay a slightly higher mortgage rate with the Home Plus program compared to other mortgage programs. But that’s typically counteracted by the lower mortgage insurance premiums on offer.

Check your Loan Estimate’s annual percentage rate (APR) to see what you’ll actually pay and compare that with Loan Estimates you get from other lenders outside the program.

Credit score minimums start at 640 with Home Plus AZ, which is a bit tougher than the 620 minimum on mortgages from Fannie Mae and Freddie Mac. It’s also a much higher threshold than the 580 minimum for FHA loans. So you may have to look elsewhere if your credit score is an issue. Check out the resource section below for the Home Plus AZ webpage and FAQs.

Arizona first-time home buyer grants

Home Plus AZ doesn’t provide grants. But it does provide down payment assistance in the form of an interest-free, forgivable second mortgage with a three-year loan term. You can also borrow up to 5% of the home’s purchase price, depending on the type of mortgage you choose and your personal circumstances.

• These forgivable loans require no monthly payments. Your loan balance is reduced by 1/36th of the amount you borrowed each month. So, at the end of three years, you owe nothing
• If you sell before the loan term ends, you'll have to repay the portion of your original debt that is yet to be forgiven. Also, refinancing within that time could require repayment as well. Still, three years is a short time

Home Plus AZ may not be the only home buyer assistance program in your town, city, or county. So make sure you check out local down payment assistance programs in case one of those suits you better.

There’s a list of city programs below. But do an internet search "[your city or county] down payment assistance” to make sure you don’t miss any.

Buying a home in Arizona’s major cities

It’s no surprise that home prices in Phoenix, Mesa and Tucson are higher than Arizona’s statewide average. Though some cities offer their own assistance programs, in addition to those run by the state.

Here’s what you can expect if you’re buying in one of Arizona’s three biggest cities.

Phoenix first-time home buyers

The median list price in Phoenix was $499,900 in September 2024. That fell 4.8% annually, according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

• $14,997 for 3% down payment
• $99,980 for 20% down payment

The City of Phoenix says that it provides down payment assistance to home buyers whose household income is no greater than 80% of the area median income (AMI) where they’re buying. Check the Median Annual Income Table in the resource section to see if you qualify.

However, there’s little other information on the city’s website. So you should call (602) 262-3111 to ask for details.

Additionally, Maricopa County also offers the Home in Five Advantage Program. Qualified low and moderate-income buyers can receive up to 5% assistance for down payment and closing costs. If you’re an eligible educator, first responder, veteran, or active-duty service member, that assistance jumps to 6%.

You must be a first-time buyer in Maricopa County with a minimum credit score of 640 to qualify. To learn more, see the resource section below for the program’s helpful website.

Tucson first-time home buyers

The median list price in Tucson was $375,000 in September 2024. That held flat year-over-year, according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

• $11,250 for 3% down payment
• $75,000 for 20% down payment

The City of Tucson’s HOME down payment assistance (DPA) program is administered by Pima county and is available countywide.

That program provides loan amounts of up to 10% of the purchase price with no monthly payments. Indeed, it says “If layered with other approved DPA resources, HOME may cover up to the remaining balance to equal 20% total subsidy to remove PMI [private mortgage insurance] on a Conventional Loan.”

Pima’s DPA fact sheet says that there’s a “Period of Affordability” during which you’ll have to repay the loan if you sell the home, transfer, or refinance your main mortgage. But that otherwise informative fact sheet doesn’t specify how long that period is, nor whether interest is charged.

You can call the Pima County Housing Center at (520) 724-2471 to learn more.

Mesa first-time home buyers

The median list price in Mesa was $498,500 in September 2024. That held flat year-over-year, according to Realtor.com.

If you want to buy a home at that median price, your down payment options might fall between:

• $14,955 for 3% down payment
• $99,700 for 20% down payment

We could find no trace of down payment assistance on the City of Mesa’s website. While Mesa Housing and Community Development (HCD) once offered its Homeownership Assistance Program (HOA), that program has vanished.

Still, Mesa first-time home buyers have access to the statewide Home Plus programs.

Alternatively, you can reach out to Mesa officials directly to see if there are any housing programs that we missed. The phone number to call is 480-644-3536.

Where to find home buying help in Arizona

All the organizations we’ve listed above should provide advice freely to any first-time home buyer in Arizona or their local area.

In addition to our selection, the U.S. Department of Housing and Urban Development (HUD) provides lists for statewide, regional, and local resources:

Statewide and regional first-time home buyer resources in Arizona

• Arizona Department of Housing
• Community Contacts: Find housing assistance that helps make affordable homeownership a reality through community partnerships with local programs
• HOME Program
• HUD approved housing counseling agencies
• Local Affiliates of Habitat for Humanity: Through volunteer labor, builds and rehabilitates houses for families in need
• U.S. Department of Agriculture Rural Housing: Homebuyer programs in rural communities
• Home Plus AZ
• Home Plus AZ FAQs
• Home Plus home buyer education information

City and county home buyer resources

• El Mirage
• Gilbert
• Mesa
• Phoenix
• City of Phoenix Median Annual Income Table
• Peoria
• Maricopa County
• Maricopa County’s Home in Five Advantage Program
• Pima County
• Tucson/Pima County “HOME” Program DPA fact sheet
• Surprise

What are today’s mortgage rates in Arizona?

You can see today’s live mortgage rates in Arizona here.

When you’re ready to start the home buying process, experiment with a mortgage calculator to see how down payment and interest rates will affect your mortgage payment. Then, get personalized rate quotes from at least three to five mortgage lenders.

Don’t just look at advertised rates online. Apply for preapproval and compare the interest rates and fees you’re offered. Because that’s the only way to know you’re getting the best deal possible on your new home loan.

¹Source: Redfin Arizona Housing Market report

²Source: Experian.com study of 2021 and 2020 data

³Based on a review of the state's available DPA grants at the time this was written