Compare Current Mortgage Rates in Arizona

Mortgage rates are determined by a few different factors, such as national and global economic conditions, the Federal Reserve, and buyer demand. Overall, there aren’t any specific rules and regulations in Arizona that affect what homebuyers pay, but state conditions can have an impact just as they would anywhere else in the country.

If you’re thinking about buying a house, it’s smart to think about Arizona interest rates and their overall effect on your home-buying journey. However, there are a few different things you can do to help yourself become a first-time homeowner, such as taking advantage of down payment assistance programs.

Yes, Arizona has a lot of first-time homebuyer programs. Its programs typically come in two forms: grants or loans. Grants are more sought-after and competitive, but loans are often forgivable — meaning the borrower doesn’t have to make any payments when certain conditions are met. Most homebuyer programs are meant to help with either down payment or closing costs.

Arizona statewide programs

Home Plus: Home Plus is a second mortgage you can use with conventional, FHA, VA, and USDA loans. It is a three-year, no-interest, no-payment loan that is completely forgiven if the homeowner doesn’t sell within the first 36 months. If you sell during the first 36 months, you will have to pay back the loan amount. Credit score requirements, income limits, and debt-to-income ratio (DTI) qualifications vary based on the type of loan you use for your primary mortgage. 

Pathway to Purchase: Pathway to Purchase is a soft loan, which means you only need to pay back any money you receive from the program if you choose to sell your home. You may either receive up to 10% of the purchase price or $20,000, whichever amount is less. It’s only available in ZIP codes deemed to have not fully recovered from the Great Recession. 

Coconino County

City of Flagstaff Community Housing Assistance Program (CHAP): The program offers to $15,000 in down payment assistance. The home price can’t exceed FHA mortgage limits, and funds must be repaid if the home is sold, refinanced, or ceases to be owner-occupied. Household income can’t exceed 125% of the area median income.

Maricopa County 

Home in Five Advantage Program: With Home in Five, eligible homebuyers who work with specific lenders may receive grants equal to 6% of the required down payment, which they can use to purchase a home in Maricopa County. They may also get a low interest loan, too. The full list of lenders you can work with is quite extensive.

The Avondale First-Time Homebuyer Program: This program helps homebuyers buy their first home in the city of Avondale. If you qualify, you may receive up to $30,000. As with Home Plus, it comes in the form of a forgivable loan. The amount each homebuyer qualifies for is determined by their overall need. If you move within a certain amount of time or fail to take care of the property, you will be required to pay back the loan amount. 

City of Chandler First Time Homebuyer’s Program: If your income is below 80% of the area median income, you may be eligible for Chandler’s first-time homebuyer’s program. The full amount you may qualify for isn’t disclosed, but it’s meant to help first-time homebuyers who may otherwise be priced out of Chandler. 

City of Phoenix Section 32 Homeownership Program: This program is for homebuyers who earn below 80% of the area median income; it also offers 20% off home appraised value as well as a grant for down payment and closing costs. 

City of Phoenix Open Doors Down Payment Assistance Program: This is a deferred payment loan, but the loan is forgiven after the period of affordability, which can be up to 15 years. It can be used for up to 10% of the home purchase price, but the purchase price can’t exceed $428,000. Income must be below 80% of the area median income. 

City of Tempe first-time homebuyers programs: The city has two programs: Community-Assisted Mortgage Program (CAMP) and Expanded Community Assistance Mortgage Program. Both come in the form of deferred loans, but the first program is for homebuyers who are below 80% of the area median income, while the second is for buyers who are between 81% and 120% of the median income. 

Pima County

City of Tucson Down Payment Assistance Program: The home price must be below $302,100 if it’s an existing home, or $358,835 if new. Homebuyers must contribute at least $1,000 to the purchase and have at least two months of mortgage payments in the bank. Buyers must also fall below 80% of the area median income. 

Pinal County

Pinal County Homeownership Housing Development: Aid may come in the form of a grant, loan, or deferred payment loan, and homebuyers must be at or below 80% of the area median income. The homebuyers live in the home for the minimum period of affordability. The amount of aid varies with each homebuyer. 

While your mortgage rate in Arizona is influenced by some things outside your control, there are a few things you can do to influence the rate in your favor.

• Improve your credit score: Your credit score is used to determine your credit risk. The less of a perceived risk you are to lenders, the better your interest rate may be.
• Lower your debt-to-income ratio (DTI): You will likely lower your DTI by improving your credit score, but not necessarily. The fewer debt obligations you have each month, the lower your DTI will be. Typically, lenders like to see DTIs below 36% and may give a lower interest rate if you have fewer debts. 
• Compare loans: You may get a lower interest rate by opting for a different type of mortgage. For example, if you qualify for a conventional mortgage, you may receive a better rate with it than you would with an FHA loan. 
• Compare lenders: Some lenders will offer you different rates than others. It’s always worth your time to compare rates to save money.
• Save for a higher down payment: A higher down payment will result in a lower loan-to-value ratio, which should lower your interest rate with your lender.

Homebuyers have five mortgage options from which to choose: conventional, FHA, VA, USDA, and jumbo loans. Here is what you need to know about each:

Conventional loan

• This type of home loan is not insured by the U.S. government. It follows guidelines established by Fannie Mae and Freddie Mac. 
• Down payment requirement: 3%
• Minimum credit score: 620
• Maximum loan amount: $766,550

FHA

• This loan is for borrowers who may not meet the eligibility requirements necessary to qualify for a conventional loan. FHA loans are insured by the U.S. government. 
• Down payment requirement: 3.5%
• Minimum credit score: 580 for a 3.5% down payment
• Maximum loan amount: Varies by county, but for most counties, the limit is $498,257

VA

• This type of loan is available to active and retired military and their spouses. 
• Down payment requirement: 0%
• Minimum credit score: Varies by lender; no minimum established by VA
• Maximum loan amount: No limit if you have full entitlement

USDA

• A USDA loan is for properties the United States Department of Agriculture has deemed to be in an area in need of economic improvement. Most homes that qualify tend to be in rural areas. 
• Down payment requirement: 0%
• Minimum credit score: Varies by lender; no minimum established by the USDA
• Maximum loan amount: $377,600 for most counties except Coconino ($414,000), Maricopa ($424,100), and Pinal counties ($424,100)

Jumbo

• This type is for homes that exceed the pricing limitations established by Fannie Mae and Freddie Mac. 
• Down payment requirement: 10%-20% depending on lender
• Minimum credit score: Varies by lender
• Maximum loan amount: No maximum amount