First-time Homebuyers

THDA is a Great Choice for First-time Homebuyers

For first-time homebuyers, one of the greatest obstacles in the homeownership process is saving the money to cover the downpayment and closing costs. The Great Choice Loan Program provides qualified Tennesseans up to 5% downpayment assistance to be used with FHA, VA, USDA-Rural Development and uninsured conventional loans.

  • Click here to learn more about:
    • Are you ready to own a home?
    • Types of loans, including FHA, VA, USDA-Rural Development and uninsured conventional
    • THDA's Mortgage Loan Programs (Great Choice and Great Choice Plus)
    • Downpayment and closing costs associated with buying a home
    • First steps in the homebuying process

How does Great Choice 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.

  • Click here to learn more about the Great Choice Loan Program.
  • Click here to learn more about homebuyer education.
  • Click here for more information about the HHF-DPA Homebuyer Education requirements.
  • Click here to find a THDA-approved class scheduled in your area.
  • Click here to register for an approved online homebuyer education course.

How do I qualify for a Great Choice loan?

The following list outlines the minimum qualifications needed for the Great Choice Mortgage Program:

  1. Satisfactory credit history. THDA currently requires a 640 credit score. To find out your credit score, contact one of our approved lenders in your area. If your score is lower than 640, our homebuyer education counselors can help you with strategies to raise your credit score.
  2. Household income not above maximum limits. Great Choice Loans are designed for low to moderate income Tennesseans. Income limits are based on the size of your household and county in which you will be purchasing your home. To see a list of maximum income limits by county, please click here.
  3. Purchase Price of home not above maximum limits. The Great Choice Loan Program is meant for modest homes, therefore maximum purchase price limits are in place and vary by county. To see a list of maximum purchase price limits by county, please click here.

How do I Get Started?

THDA encourages the following action steps depending on your level of familiarity with the homebuying process:

1- Homebuyer Education Course: For those just starting out on the homeownership journey, THDA recommends you take a homebuyer education course. For THDA loans providing downpayment assistance, homebuyer education is a required. Courses are offered in two formats - in-person, classroom style and online. The online course includes one personal session with a homebuyer education trainer. Both formats are offered through approved THDA educators and counselors and cover the following:

  • Steps to homeownership
  • Clarify common, but confusing, mortgage concepts like title insurance and PMI
  • Outline various mortgage types, including THDA’s Great Choice Loan Program
  • Develop an understanding of budgeting and credit scores
  • Connect you with a trainer who can act as a resource throughout the homeownership process

Homebuyer Education course fees vary depending on the course. Online pre-purchase homebuyer education is $99. In-person pre-purchase classes can cost up to $99. Online post-purchase classes are an additional $50.

If you plan to take part in the $15,000 HHF Down Payment Assistance program, you must complete your homebuyer education class with a provider who is approved for the HHF-DPA program.

Click here to find a THDA-approved homebuyer education course scheduled near you.

Click here to register for an online homebuyer education course.

2- Talk to a Lender: First-time homebuyers more familiar with homeownership, but who wish to know more about the Great Choice Loan Program, are encouraged to contact a THDA-approved lender. Click here for a list of THDA-approved lenders organized by county or here to find a lender in a complete alphabetical listing.