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 of them fixed-rate. 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 stronger credit usually compare conventional against FHA. Buyers with mid-range scores 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 | Most flexible on credit | Upfront + monthly premiums |
| VA | Dept. of Veterans Affairs | Flexible; lender sets the minimum | None (funding fee instead) |
| USDA | U.S. Dept. of Agriculture | Moderate | Guarantee fees |
| Conventional (HFA Preferred/Advantage) | Fannie Mae / Freddie Mac | Rewards higher scores | 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 working through our credit score guide 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?
HOME Plus assistance tops out at 4% of the loan amount, and your lender confirms the amount available for your loan type and profile 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 fixed-rate loans.
Does the loan type change the forgiveness terms?
No. Whatever first mortgage you pick, Arizona IDA publishes the same HOME Plus rule: the forgivable second is forgiven in full after 60 months and repaid if you sell or refinance sooner, and a non-forgivable option is also available — details in how Arizona DPA forgiveness works.
What credit score do I need?
Enough to clear the HOME Plus program minimum and the standard for the loan type you choose, plus any lender overlay; your loan officer confirms the current figure. Conventional pricing rewards higher scores. See the Arizona DPA 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.
Buying Somewhere in Arizona?
Answer three short questions about where in Arizona you're buying, your credit range and recent home ownership, and a licensed loan officer will follow up on which Arizona programs fit. You pick a credit range; no report is pulled.
Start the Arizona Quiz