First-Time Homebuyer Programs in Tennessee

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The Great Choice Loan Program offers downpayment assistance and 30-year fixed interest rate mortgage loans for first-time home buyers in Tennessee.

Great Choice Loan Program (THDA)

THDA (Tennessee Housing Development Agency) offers down payment and closing cost assistance for first time home buyers through their Great Choice Home Loan programs. If you qualify for a Great Choice Home Loan, you can also apply for the Hardest Hit Fund Down Payment Assistance (HHF-DPA) program. These T.H.D.A. programs provide up to 6% of the sales price in down payment and closing cost assistance in the form of a forgivable second mortgage loan for Tennessee residents that purchase an existing home in a targeted ZIP code. The THDA programs are awarded based on several criteria including: income, number of people in the household, debts, and credit score.

First-Time Home buyer Workshop: For those just starting out on the homeownership journey, It's recommended to take a first-time homebuyer education course. Crystal Ragan has teamed up with a local lender to offer classes that help guide first time home buyers through the entire process. (This is not the first time homebuyer education course required by THDA)

Deferred Option ( No Payments)

THDA will provide $6,000 in the form of a forgivable second mortgage loan on your home. The loan has a 0% interest rate and the payments are deferred until the end of the 30 year term, at that time the loan is forgiven. The loan will be due in full at the time the home is refinanced or sold.

Amortizing Option (Payment)

THDA will provide 6% of the sales price in the form of a second mortgage loan on your home, that is paid in monthly payments over 15 years at an interest rate that is the same as the first mortgage rate. The loan may also be used to pay closing costs.

How does the Great Choice Home Loan Program work?

THDA offers 30-year, fixed interest rate mortgage loans and an option for downpayment assistance to qualified first-time homebuyers in Tennessee. Since the home purchase process can be costly and complex, THDA requires applicants to take a homebuyer education course before closing on a loan providing downpayment assistance. THDA recognizes the value of homebuyer education and encourages it for all consumers considering homeownership. THDA’s purpose is not only to assist people with purchasing homes, but also to help them become long-term, successful homeowners.

Minimum Credit Score - The credit score of everyone on your loan application must be at least 640. If you do not know your credit store, your lender can check for you.

Household income and purchase price limits - To qualify for the Great Choice Home Loan program in Rutherford County, the maximum of your total household income is $118,020 and the maximum price you can pay for a home is $375,000. See the full chart of income and purchase price limits.

Homebuyer Education

To qualify for down payment assistance, you must complete a pre-purchase Homebuyer Education course from a THDA-approved instructor. You can take this course online or in a classroom style (virtual/in-person) with other homebuyers like yourself. To learn more or to enroll in one of these courses, click here.

• Click here to learn more about the Great Choice Loan Program.
• Click here for the Handbook For Homebuyers.
• Click here to learn more about the Great Choice Special Military Discount Program.
• Click here to learn about the First Time Home Buyer Workshop