First-time home buyer programs in Arkansas (ADFA, Little Rock)

What ADFA offers

ADFA is the state’s housing finance agency, a division of the Arkansas Department of Commerce. It does not lend directly to you: you apply through an approved participating lender, and ADFA keeps a lender list on its website.

StartSmart is the first-time buyer program. According to ADFA:

• It is a 30-year fixed-rate first mortgage with no prepayment penalty, in FHA, VA or RD form, or as a Freddie Mac conventional loan (HFA Advantage).
• The rate is “approximately 1% below market rate,” and ADFA says rates can change without notice.
• The buyer must not have owned a principal residence in the three years before closing. This rule does not apply to veterans and their spouses, or to buyers in 30 “targeted” counties (Pulaski is not one of them).
• The credit score must be at least 640, the home must be your primary residence, and the purchase price cannot exceed $500,000.
• Eligible homes include single-family houses, townhomes, condominiums, planned unit developments and modular homes, on lots of no more than 5 acres.

Move-Up is for buyers who are not first-time buyers. ADFA’s page states a qualifying income limit of $142,000, a minimum credit score of 640, and a price limit equal to the Arkansas conventional conforming loan limit. FHFA set the 2026 baseline conforming limit at $832,750; check with your lender for the limit that applies to your county.

Down Payment Assistance (DPA) is a second mortgage paired with either first mortgage. ADFA’s page says it ranges from $1,000 to $15,000 for down payment and closing costs, has a 10-year term, and you must qualify for a StartSmart or Move-Up first mortgage to get it. ADFA’s page does not state the interest rate; ask a participating lender.

Income limits in Little Rock

StartSmart income limits depend on the county and the household size. ADFA’s table effective June 1, 2026 lists Pulaski County, where Little Rock sits, as a non-targeted county:

Source: ADFA, “StartSmart Income Limits,” effective 06/01/2026.

ADFA’s page also links an older limits document dated June 3, 2025. The June 2026 table is the later one.

Programs from the City of Little Rock

The city’s Department of Housing and Neighborhood Programs runs two forgivable-loan programs for homes inside the city limits. Both are paid through your mortgage lender (the lender must have a physical location in Arkansas), require a homebuyer counseling course, and require you to live in the home for five years. The loan is forgiven in equal monthly installments over 60 months.

Sources: City of Little Rock, DPA flyer (2025 income limits) and CDBG-DR program page.

For the DPA, the city’s flyer lists maximum incomes effective April 1, 2025 of $51,950 for one person, $59,350 for two, $66,750 for three and $74,150 for four. The buyer must not have owned a home in the past three years, and all repairs must be done before approval.

The HAP is tied to the March 31, 2023 tornado recovery. The city says it received HUD approval on June 29, 2026 to raise the income limit from 120% to 150% of the area median. Its application package says the buyer must be a U.S. citizen or another person eligible for federal public benefits, and that the home must pass a city inspection. The package also mentions a CDBG-DR target area; confirm with the city that your address qualifies. The city says HAP generally cannot be combined with another program that pays for the same down payment or closing costs.

A worked example

At the Little Rock median value of $270,700 (see home prices in Arkansas and Little Rock; this is an owner estimate, so the example is only an illustration), 6% would be $16,242, so the city DPA would stop at its $10,000 cap. Under HAP, 8% would be $21,656, so the $15,000 cap applies. The 6% limit only binds below a price of about $166,700, and the 8% limit below $187,500.

How to apply

1. Choose a participating lender from ADFA’s list. For the city programs, ask whether the lender takes part in them.
2. Get qualified for the first mortgage. The city says it takes applications only after the lender’s underwriting.
3. Complete a homebuyer counseling course that the program accepts. HAP requires a HUD-approved course.
4. Ask your lender to submit the ADFA and city paperwork. City staff will inspect the home.

Closing costs still apply with any program; see our guide to closing costs in Arkansas and our page on buying a home in Little Rock. For the national picture, read the steps of buying a home and our guide to FHA loans.