Arkansas First-Time Home Buyer Programs (2026)
Arkansas First-Time Home Buyer Programs (2026)
Every Arkansas first-time buyer program — ADFA Move-Up, FHA, USDA, VA, Conventional 97, and MCC tax credit — in one place. With program stacking rules.
Updated May 2026 · Reviewed by Conan Watters, Licensed Arkansas Originator · NMLS #252910
The short answer: Most Arkansas first-time buyers stack two programs — a base mortgage (FHA, USDA, VA, or Conventional 97) plus ADFA Move-Up down-payment assistance ($15,000 grant or $12,500 second mortgage). About one in three also qualifies for the Mortgage Credit Certificate (MCC) tax credit when ADFA bond authority is available. Below is every option, with eligibility rules and 2026 figures.
2026 Arkansas first-time buyer programs at a glance
| Program | Down payment | Min FICO | Key benefit |
|---|---|---|---|
| USDA Rural Development | 0% | 640 | ~97% of Arkansas land qualifies; no down payment |
| VA Home Loan | 0% | 580* | Zero down + no PMI for veterans/active-duty |
| FHA Loan | 3.5% | 580 | Most flexible underwriting; gift funds accepted |
| Conventional 97 | 3% | 620 | PMI removable at 80% LTV |
| ADFA Move-Up (DPA) | n/a | matches base | $15,000 grant or $12,500 second mortgage |
| MCC (Mortgage Credit Certificate) | n/a | matches base | Up to $2,000/year federal tax credit |
*VA technically has no minimum FICO; 580 is the typical lender floor.
1. ADFA Move-Up Down Payment Assistance
ADFA Move-Up is the Arkansas Development Finance Authority’s down-payment assistance program. It provides one of two options that stack on top of an FHA, VA, USDA, or Conventional loan:
- $15,000 grant — no repayment required (subject to recapture if you sell or refinance within 9 years)
- $12,500 second mortgage — 0% interest, payable as a balloon at sale/refinance
To qualify, your income must fall within ADFA county income limits (typically $128,520 for 1-2 person household, $149,940 for 3+ in most counties), and the property purchase price must fall within county purchase-price caps. ADFA does not require strict first-time-buyer status in all cases — repeat buyers can sometimes use it.
Lender must be ADFA-approved. ARLoanSource is an ADFA-approved lender. See full ADFA Move-Up details.
2. USDA Rural Development Loan
Zero-down mortgage backed by USDA. ~97% of Arkansas land qualifies — including most of the state outside of Little Rock, Conway, Fayetteville-Bentonville metro, and parts of Northwest Arkansas. Verify your specific address at eligibility.sc.egov.usda.gov.
- Min FICO: 640 (most lenders)
- 2026 income cap: ~$112,450 for 1-4 person household (most counties)
- USDA guarantee fee: 1.0% upfront + 0.35% annual
- Must be primary residence
3. FHA Loan
Most flexible first-time buyer mortgage. Federal Housing Administration-insured, allowing 3.5% down with 580+ FICO.
- 2026 Arkansas 1-unit limit: $524,225 (most counties)
- 3.5% down at 580+ FICO; 10% down at 500-579 FICO
- 1.75% upfront MIP + 0.55% annual MIP
- Gift funds accepted for entire down payment
- Stacks with ADFA Move-Up
4. VA Home Loan (Veterans)
Zero-down, no-PMI mortgage for qualifying veterans, active-duty service members, and surviving spouses. Requires a Certificate of Eligibility (COE).
- Zero down (full entitlement)
- No private mortgage insurance
- VA funding fee 1.4–3.6% (waived for disabled veterans)
- Manual underwrite available for non-standard credit
- IRRRL streamline refinance option later
5. Conventional 97
Fannie Mae / Freddie Mac program allowing 3% down for first-time and qualified repeat buyers.
- 3% minimum down payment
- 620+ FICO typical minimum
- PMI required below 20% down (removable at 80% LTV)
- 2026 conforming limit: $806,500 (most Arkansas counties)
See full Conventional loan details.
6. Mortgage Credit Certificate (MCC)
The MCC is a federal income-tax credit equal to a percentage (often 25–50%) of mortgage interest paid each year, capped at $2,000/year. Unlike a deduction, it directly reduces your federal tax bill dollar-for-dollar.
ADFA periodically issues MCCs to Arkansas first-time buyers based on available bond authority. Availability fluctuates by year. Combining an MCC with ADFA Move-Up DPA can save thousands annually for qualifying Arkansas buyers.
Call us at 501-225-5626 to confirm current MCC availability and your eligibility.
Program stacking: how to combine for maximum benefit
Most cost-effective combinations for Arkansas first-time buyers:
| Scenario | Stack | Total cash to close* |
|---|---|---|
| Veteran, $200k purchase | VA + ADFA Move-Up grant | $0–$3,500 (closing only) |
| Rural Arkansas, $200k purchase | USDA + ADFA Move-Up grant | $0–$3,500 |
| Urban Arkansas, $200k purchase, 580 FICO | FHA + ADFA Move-Up grant | $0–$2,000 |
| Higher income, $300k purchase | Conventional 97 + MCC | $12,000 down + $5,000 closing |
*Estimates only. Actual cash to close depends on seller credits, property taxes, and other factors. Get a personalized Loan Estimate by calling 501-225-5626.
How to apply
- Get pre-qualified. Submit the form on this page or call 501-225-5626. Same-business-day pre-qualification for most files.
- Confirm program eligibility. We verify which combination works for your income, credit, location, and goals.
- Gather documents. 2 years W-2s, 2 paystubs, 2 months bank statements, ID, and COE (veterans).
- Get your Loan Estimate. Within 3 business days of a complete application per TRID.
- Find your home and submit an offer. Pre-approval letter included.
- Appraisal and underwriting. 21–30 days from accepted contract to close.
- Close. Closing Disclosure delivered 3 days before. Sign and you’re a homeowner.
Frequently asked questions
What counts as a first-time home buyer in Arkansas?
For most Arkansas first-time buyer programs (including ADFA Move-Up), you qualify as first-time if you have not owned a primary residence in the past 3 years. Veterans typically waive this requirement, and ADFA targeted areas may also waive it.
Can you stack ADFA Move-Up with an FHA loan in Arkansas?
Yes. ADFA Move-Up’s $15,000 grant or $12,500 second mortgage can be combined with FHA, VA, USDA, or Conventional financing. Most Arkansas first-time buyers stack ADFA with FHA for the lowest total cash-to-close.
What FICO score do I need?
Minimum FICO depends on the base program: FHA at 3.5% down requires 580. USDA Rural Development requires 640. VA typically requires 580. Conventional 97 requires 620. ADFA Move-Up doesn’t add its own FICO requirement on top of the base program.
How much down payment do I need?
Arkansas first-time buyers can buy with 0% down (USDA or VA), 3% down (Conventional 97), or 3.5% down (FHA). Combined with ADFA Move-Up’s $15,000 grant, many buyers close with little to no out-of-pocket cash.
Is there a Mortgage Credit Certificate in Arkansas?
ADFA periodically offers Mortgage Credit Certificates (MCC) allowing up to 50% of mortgage interest paid to be claimed as a direct federal tax credit (up to $2,000/year). Program availability fluctuates by ADFA bond cycle — call 501-225-5626 to confirm current availability.
What’s the income limit for ADFA Move-Up?
ADFA Move-Up income limits vary by county and household size. In most Arkansas counties for 2026, the limit is approximately $128,520 for a 1-2 person household and $149,940 for 3+ persons. Higher caps apply in Pulaski, Faulkner, Saline, Crittenden, and several other counties.
How long does the process take?
From pre-qualification to closing: typically 30–45 days. Pre-qualification is same-business-day at ARLoanSource. Underwriting takes 5–15 business days after complete application. From contract to close is usually 21–30 days.
Can I use gift funds for my down payment?
Yes. FHA, USDA, VA, and most Conventional programs accept gift funds from family for down payment and closing costs. The donor must provide a signed gift letter and the funds must be sourced via bank statement.
Ready to start?
Call 501-225-5626 or request pre-qualification online.
Same-business-day response. NMLS #252910.