THDA Rates & Programs October 2026: $6,000 Forgivable DPA + Below-Market Rates
By Sarah Mitchell••10 min read
Tennessee buyers: THDA's Great Choice runs ~6.75% — below the 6.84% market — with a $6,000 forgivable down payment grant or $15,000 amortizing. Heroes (military, teachers, first responders) get another 0.50% off. Full October 2026 breakdown.
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TN Buyers: $6K Forgivable + 6.75% Rate
THDA rates update every Tuesday. Check eligibility with an approved lender first.
📊 All THDA Programs — October 2026
| Program | Type | Rate | DPA | Apply |
|---|---|---|---|---|
| THDA Great Choice Base program — FHA/VA/USDA/conventional. 640 credit min. Below-market rate for first-time buyers. | 30-yr fixed mortgage | ~6.75% | None required | Check Eligibility → |
| Great Choice Plus $6,000 forgivable DPA — no payments, forgiven after 30 years. The main TN DPA. | DPA second mortgage | 0% deferred | $6,000 forgivable | Check Eligibility → |
| Great Choice Plus (amortizing) Higher DPA option — repayable over 30 years at same rate as first mortgage. | DPA second | First-lien rate | Up to 5% ($15K max) | Check Eligibility → |
| Homeownership for Heroes Military, veterans, police, firefighters, EMTs, teachers — 0.50% off Great Choice rate. | Rate discount | -0.50% | Stacks with Plus | Check Eligibility → |
| THDA Homebuyer Ed Free 1-hour online course required for DPA programs. Certificate valid 12 months. | Free course | Free | Required for Plus | Check Eligibility → |
🧮 Real Math: $280K Nashville Purchase, FHA + THDA
- Home price: $280,000 · FHA 3.5% down: $9,800 needed
- THDA Great Choice Plus: $6,000 forgivable → cuts cash needed to ~$3,800 + closing costs
- Rate: 6.75% THDA vs 6.84% market → saves ~$18/mo, $6,480 over 30yr
- If teacher/nurse/cop: Heroes takes rate to 6.25% → another $110/mo saved
- 💡 Total THDA advantage vs market rate + no DPA: ~$12-15K in first-5-year value.
TN Veteran or Active Duty?
VA $0 down + THDA DPA for closing costs + Heroes rate discount = nearly $0 out of pocket.
VA + THDA Eligibility →❓ THDA FAQs
What are THDA mortgage rates in October 2026?
THDA Great Choice runs ~6.75% on 30-year fixed in October 2026 — about 0.10% below the conventional market (6.84%). Homeownership for Heroes drops it to ~6.25% for eligible buyers. THDA sets rates weekly (updates Tuesdays) — they move with bond markets, so check thda.org for the current weekly rate.Check TN DPA eligibility →
Who qualifies for THDA programs?
Requirements: (1) First-time buyer OR buying in a targeted county OR haven't owned in 3 years. (2) 640+ credit score. (3) Income under ~$118,560 household (varies by county — higher in Nashville metro). (4) Purchase price under ~$455,800 statewide (higher in targeted areas). (5) Complete THDA homebuyer education for DPA programs.Get FHA pre-approved →
How much down payment assistance does THDA give?
Two tiers: $6,000 forgivable (zero interest, zero payments, forgiven if you stay 30 years — effectively free) OR up to 5% of purchase price ($15,000 max) as an amortizing second at your first-mortgage rate. Most buyers take the $6,000 forgivable for FHA 3.5% + closing help.Check TN DPA eligibility →
What are THDA income limits by county?
Income limits vary: roughly $94,000-$131,000 depending on county and household size. Nashville/Davidson runs ~$118,560 for 1-2 person households; Shelby County ~$98,000; rural counties ~$94,000. Targeted counties have NO income limit and NO first-time buyer requirement.Get FHA pre-approved →
Can I combine THDA with FHA or VA?
Yes — Great Choice is a mortgage program, not a loan type. Stack it: FHA 3.5% down + THDA $6,000 covers nearly all of it. VA buyers get $0 down + THDA DPA covers closing costs. USDA $0 down + THDA for closing. This is why TN has one of the best first-time buyer value propositions nationally.Check TN DPA eligibility →
How do I apply for THDA?
You can't apply to THDA directly — go through a THDA-approved lender (100+ in TN: FirstBank, CB&S, local credit unions, national lenders). Steps: (1) Get pre-approved with a THDA lender. (2) Complete free homebuyer ed. (3) Lock the weekly THDA rate. (4) Close normally — DPA second attaches at closing.Get FHA pre-approved →
Lock This Week's THDA Rate
Rates update Tuesdays. Get pre-approved with a THDA-approved lender to lock before the next update.