THDA (Tennessee Housing Development Agency) is one of several agency’s that have grant mortgage programs. These programs offer either a below market interest rate or state grant money for your down payment and closing costs. One of the primary ways THDA assists people is by offering home loans for first time homebuyers, with grants of up to 4 percent of the acquisition costs or below market interest rates. THDA’s programs are designed for low and moderate income borrowers and you must meet the qualifications in order to apply for a Tennessee THDA loan.

The THDA loan programs were designed to offer help to low to moderate income buyers in TN seeking to purchase an affordable home. Here are the main things to know about THDA loans:

  • Loans can be used only for primary residences in TN from one to four units
  • THDA loans are always 30 year terms with fixed rates.
  • Borrower must qualify for an FHA, USDA Rural Development, or VA loan program before the loan can “become” a THDA subsidized loan program. The vast majority of THDA loans are FHA, since FHA loans have the broadest in eligibility requirements. Minimum credit score for any THDA loan is 620 as of right now.
  • THDA loans can effectively make FHA loans near-100% or 100% financing when combined with available THDA grant money, a “community” 2nd mortgage program like The Housing Fund, or THDA’s “Stimulus” 2nd mortgage program.
  • THDA loans are made generally to first time buyers (including people who haven’t owned a home in 3 years); the exception to this rule is when a buyer is purchasing in a “targeted” county; for example, middle TN “targeted” counties include Cannon, Clay, Dekalb, Franklin, Giles, Grundy, Hickman, Houston, Jackson, Lawrence, Lincoln, Macon, Marion, Maury, Stewart, Trousdale, Van Buren, Wayne, and White.

Speak to one of our Professional Loan Officers now to find out i