Arkansas offers up to $15,000 in ADFA down payment assistance, plus a 2026 homestead tax credit increase that requires filing with your county assessor.

Updated: July 2026 | Source: ADFA.arkansas.gov · Arkansas DFA · FHFA · HUD · Freddie Mac PMMS

Arkansas Home Loans 2026 — Complete Guide

From 3.5% down FHA to $15,000 in state down payment assistance — here is what home buyers in Arkansas can access in 2026.

Arkansas remains one of the more affordable states to buy in, and a recent increase to the state's homestead tax credit puts more money back in owner-occupants' pockets starting this year. This guide covers loan limits, current rates, that credit, and the ADFA programs available to general buyers this year.

$270,300

AR median home price (March 2026)

6.55%

Avg. 30-yr conventional rate

$15,000

Max ADFA down payment assistance

$541K / $833K

FHA / conforming limit — flat statewide

The number people miss: Arkansas's Homestead Tax Credit just increased from $425 to $600 for 2026 tax bills — but it is not automatic. You must apply with your county assessor to receive it, and buyers who skip the paperwork simply pay the full bill.

Arkansas Down Payment Assistance — ADFA Programs

The Arkansas Development Finance Authority (ADFA) offers down payment assistance paired with either its StartSmart (first-time buyer) or Move-Up (open to all buyers) first mortgage.

ADFA Down Payment Programs

ADFA Down Payment Assistance (DPA)$1,000–$15,000, 10-yr second mortgage

Arkansas Dream Down Payment Initiative (ADDI)Up to 10% or $10,000, forgivable after 5 yrs

DPA and ADDI work differently — verify which applies to you: ADFA's official program description describes standard DPA as a repayable second mortgage at your first mortgage's rate over 10 years, not a forgivable grant. ADDI is the more generous, lower-income-targeted alternative that is explicitly forgivable after 5 years with no monthly payment. Some third-party guides blur these two together — confirm which structure applies to your specific loan with an ADFA-approved lender.

StartSmart vs. Move-Up: StartSmart is limited to first-time buyers with income at or below 115% of area median income and a purchase price cap (around $331,000 in most areas). Move-Up has no first-time buyer requirement and a higher income ceiling (around $142,000), making it the option for repeat buyers who still need down payment help.

Eligibility & Purchase Price Limits

Both ADFA programs require a minimum 640 credit score, and first-time buyers using a conventional mortgage must complete a homebuyer education course.

Confirm your exact income limit, purchase price cap, and current terms at ADFA.arkansas.gov before applying.

Current Rates

Product	Rate	Source
30-yr Conventional	6.55%	Freddie Mac PMMS, week of July 16, 2026
15-yr Fixed	5.93%	Freddie Mac PMMS, week of July 16, 2026
ADFA StartSmart / Move-Up first mortgage	Below market	Confirm current rate with an ADFA-approved lender

2026 Loan Limits — Flat Statewide

Arkansas has no FHA or conforming high-cost counties in 2026 — the same limit applies statewide, including Little Rock, Fayetteville, and Northwest Arkansas.

Loan Type	Limit (Statewide, All Counties)
FHA	$541,287
Conventional (Conforming)	$832,750
VA	No county limit for buyers with full entitlement

Confirm current limits at HUD.gov, though Arkansas has held flat statewide limits for several years running.

Property Tax in Arkansas

What Buyers Should Budget For

Statewide average effective rate~0.55%–0.60%

Homestead Tax Credit (2026)Up to $600/year, up from $425

Homestead assessed value growth capMax 5%/year (10%/year for other property)

100% disabled veteran exemptionFull exemption, no income limit

Arkansas assesses real property at 20% of appraised value statewide, and the Amendment 79 Homestead Tax Credit reduces the resulting bill by up to $600 a year for 2026 — an increase from the prior $425 level. This credit applies to any owner-occupied primary residence, but you must apply through your county assessor's office; it is not applied automatically. Amendment 79 also caps how fast the taxable value of a homestead can rise from a countywide reappraisal at 5% per year (10% for non-homestead property like rentals and commercial), protecting long-term owners from sudden spikes. Veterans with a 100% service-connected disability, along with their surviving spouses and minor dependent children, qualify for a complete exemption from property tax on their homestead.

Pick Your Loan Type

FHA3.5% down, flexible credit ConventionalSkip MIP with 20% down USDA$0 down in eligible areas VA$0 down for veterans

Try the Loan Calculator Compare FHA, Conventional, USDA & VA with Arkansas prices and current rates

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Are you a teacher, nurse, firefighter, police officer, EMT, or veteran? Arkansas may run additional hero-specific loan programs on top of the general ADFA options covered here. Browse the Hero Home Loan Programs hub and select Arkansas for profession-specific options.

Frequently Asked Questions

Do I have to repay ADFA's down payment assistance?

The standard DPA program is a repayable 10-year second mortgage. ADDI, a separate lower-income program, is forgivable after 5 years with no monthly payment. Confirm which program you're using, since the terms differ substantially.

Is the Homestead Tax Credit automatic?

No. You must apply with your county assessor's office. New homeowners should apply as soon as possible after closing to receive the credit on their first tax bill.

Should I use StartSmart or Move-Up?

StartSmart is limited to first-time buyers with income at or below 115% of area median income and a purchase price cap. Move-Up has no first-time buyer requirement and a higher income limit, making it the choice for repeat buyers.

Does the 5% assessed value cap apply to all Arkansas property?

No, only homestead (owner-occupied primary residence) property gets the 5% cap on reappraisal-driven increases. Rentals, commercial property, and vacant land are capped at 10% per year instead.

Bottom Line: Arkansas offers genuinely affordable home prices, flat statewide loan limits, and a recently increased Homestead Tax Credit that meaningfully lowers the ongoing cost of ownership — but only if you apply for it. ADFA's down payment assistance covers a real share of upfront costs; just confirm whether you're using the repayable DPA or the more generous forgivable ADDI program.

Disclaimer: This post is for informational purposes only and does not constitute financial, legal, or mortgage advice. Program terms, rates, income limits, and availability change frequently — verify all details directly with official program sources before making any financial decisions. StatewiseFinance is not affiliated with any government agency or lender listed in this post.