HOME Plus Loan Types: FHA, VA, USDA, or Conventional?
HOME Plus pairs Arizona DPA with FHA, VA, USDA, or conventional loans. Compare credit requirements and mortgage insurance to pick the right loan type.
The Arizona HOME Plus program pairs its down payment assistance with four first-mortgage options: FHA, VA, USDA, and conventional (Fannie Mae HFA Preferred or Freddie Mac HFA Advantage) — all 30-year fixed loans. The right choice depends mostly on your credit score, your eligibility for VA or USDA, and how each loan type handles mortgage insurance.
The Four HOME Plus Loan Types at a Glance
Quick Answer: Veterans should evaluate VA first. Buyers with 680+ credit usually compare conventional against FHA. Buyers in the 640–679 range often find FHA the smoother path. USDA only applies in designated rural areas.
| Loan Type | Backed By | Typical Credit Fit | Mortgage Insurance |
|---|---|---|---|
| FHA | Federal Housing Administration | 640+ | Upfront + monthly premiums |
| VA | Dept. of Veterans Affairs | 640+ (program floor) | None (funding fee instead) |
| USDA | U.S. Dept. of Agriculture | 640+ | Guarantee fees |
| Conventional (HFA Preferred/Advantage) | Fannie Mae / Freddie Mac | Strongest at 680+ | Monthly PMI, can be reduced or removed |
FHA with HOME Plus
FHA loans are the workhorse pairing for Arizona DPA. Qualifying is more forgiving on credit history and debt ratios, which is why many buyers using our 640 credit score strategies land here. The tradeoff is FHA's mortgage insurance structure, which includes both an upfront premium and monthly premiums for most borrowers.
VA with HOME Plus
Eligible veterans, active-duty service members, and some surviving spouses can combine VA benefits with HOME Plus assistance. VA loans carry no monthly mortgage insurance, which makes this one of the strongest combinations available — the assistance can go toward closing costs even when the loan itself requires no down payment.
USDA with HOME Plus
USDA loans apply only in USDA-designated rural areas. Much of metro Phoenix — including most of Gilbert, Chandler, and Tempe — is not eligible, but outlying communities and much of rural Arizona are. If you're shopping outside the metro core, ask your lender to run the address.
Conventional (HFA Preferred / HFA Advantage) with HOME Plus
The conventional options are special HFA editions of Fannie Mae and Freddie Mac loans built for state housing programs. With stronger credit, these often win on total monthly cost because private mortgage insurance can be priced more favorably than FHA premiums and can eventually be removed. Income limits and program overlays apply — see the complete Arizona DPA guide for the eligibility gates.
How to Choose
- Check VA eligibility first. If you served, this pairing is hard to beat.
- Compare FHA vs. conventional side by side. Ask your lender to show both with the same assistance amount. The winner usually comes down to your credit score and mortgage insurance treatment — not the assistance itself.
- Don't chase the biggest assistance percentage blindly. Assistance tiers can differ by loan type, but a slightly smaller award on a loan with cheaper mortgage insurance can be the better deal over time.
- Confirm the program fit on our programs page and estimate amounts with the DPA calculator.
Frequently Asked Questions
Which loan type gets the most HOME Plus assistance?
Assistance tiers vary by loan type and credit profile, and they're updated by the program over time. Your lender will quote current tiers when reserving funds — treat any number you see online as a starting estimate.
Can I use HOME Plus with an adjustable-rate mortgage?
No. HOME Plus first mortgages are 30-year fixed-rate loans.
Does the loan type change the forgiveness terms?
No. The assistance is a forgivable second lien with the same three-year forgiveness schedule regardless of first-mortgage type — details in how Arizona DPA forgiveness works.
What credit score do I need?
640 is the program floor across loan types, though conventional pricing rewards higher scores. See the 640 credit score guide.
Get a Side-by-Side Comparison
Zac Cook (NMLS #2111496) and Tanner Cook (NMLS #2090424) at Cornerstone First Mortgage (NMLS #173855) can price all four HOME Plus pairings for your exact profile. Take the quiz and we'll show you the comparison.
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