The THDA Great Choice Home Loan is a 30-year fixed-rate mortgage backed by the Tennessee Housing Development Agency. It is available to first-time buyers (or those who haven't owned a home in 3 years) who meet income and purchase price limits for their county. It can be paired with Great Choice Plus down payment assistance — up to 5% / $15,000 in an amortizing second, a $6,000 deferred second mortgage forgiven after 10 years, or a newer $10,000 deferred option also forgiven after 10 years for eligible buyers. Veterans, active duty, National Guard, and Reserves qualify under the Homeownership for Heroes program, which waives the first-time buyer requirement and offers a reduced rate. Minimum 640 credit score required. I serve buyers in Johnson City, Kingsport, Bristol, and throughout Northeast Tennessee.
THDA Great Choice Plus — Down Payment Assistance Estimator
See how both assistance options compare side-by-side for your purchase price.
Great Choice Plus amounts based on published THDA program terms. This calculator compares the two most common options — the $6,000 deferred second and the up-to-$15,000 amortizing second — which share the same first-mortgage rate. A third option (up to $10,000, also deferred and forgiven after 10 years) has its own separate program rate and price cap and isn't modeled here; see below. Amortizing second uses same rate as first for estimate. Income and purchase price limits apply by county — contact Sam for your county's current limits. FHA MIP estimated at 0.55%/yr. Rates shown are illustrative inputs you control, not a quoted rate. Not a commitment to lend.
Three ways to get Great Choice Plus assistance
THDA updated this lineup in mid-2026, so if you've seen older information quoting different terms, here's what's current.
Amortizing — up to $15,000
A second mortgage with monthly payments, sized at up to 5% of your purchase price (max $15,000). More assistance upfront — useful if you need more cash to cover a larger down payment gap or closing costs. No prepayment penalty.
Available with Great Choice, Homeownership for Heroes, and Freddie Mac HFA Advantage.
Deferred, no payment — $6,000
No monthly payment on this second mortgage. 0% interest. Forgiven after 10 years — or due in full if you sell, refinance, or pay off the first mortgage before then. Best for buyers who want the lowest possible monthly payment.
Homes up to $500,000. Available with Great Choice, Homeownership for Heroes, and Freddie Mac HFA Advantage.
Deferred, no payment — up to $10,000
A newer THDA option on the same terms as the $6,000 option above — 0% interest, no monthly payment, forgiven after 10 years — just a larger amount. It pairs with a slightly different program rate than standard Great Choice, so it isn't a strict upgrade for every buyer; I compare the real numbers on a call.
Homes up to $400,000 (up to $500,000 under Homeownership for Heroes). Available with Great Choice and Homeownership for Heroes only — not offered with Freddie Mac HFA Advantage.
Which option is better depends on your purchase price, cash reserves, how long you expect to stay, and which first-mortgage program you're using. On a $250,000 home, the amortizing option gives you $12,500 — more than double the $6,000 deferred option — but it adds a monthly payment. The $10,000 deferred option can mean more assistance with still no monthly payment, but it comes with its own program rate and a lower price ceiling. I help buyers model all three against their actual numbers and current rates.
Source: THDA.org — Down Payment Assistance
THDA Homeownership for Heroes — Veterans and military
THDA's Homeownership for Heroes program is a version of the Great Choice loan specifically for active-duty military, Veterans, National Guard members, Reserves, and their surviving spouses. It offers a reduced interest rate below the standard Great Choice rate, and it waives the first-time homebuyer requirement — so Veterans who have owned a home before are still eligible.
Veterans can also combine this with a VA loan. In that structure, the VA covers the first mortgage at zero down, and THDA assistance can be used toward closing costs. This combination is one of the most powerful financing tools available to Tennessee Veterans, and I — a Marine Corps Veteran myself — structure these combinations regularly.
Homeownership for Heroes gets the same three Great Choice Plus options described above — including the newer $10,000 deferred, 10-year-forgivable option — at Heroes' own reduced program rate. One added benefit: the $10,000 option's home price ceiling is higher under Homeownership for Heroes ($500,000) than under standard Great Choice ($400,000), giving Veterans and other qualifying service professions more room on higher-priced homes.
THDA Great Choice eligibility checklist
- First-time homebuyer, or no homeownership in the past 3 years (waived for Veterans under Homeownership for Heroes)
- 640 minimum credit score (all borrowers on the loan)
- 30-year fixed-rate mortgage (FHA, VA, USDA, or conventional)
- Income within THDA county limits for your household size
- Purchase price within THDA county limits, and within the separate price cap for whichever Great Choice Plus assistance option fits ($500,000 for the $6,000 and Heroes $10,000 options; $400,000 for the standard $10,000 option) (these DPA price caps are usually well above your county's income-based purchase limit, but I confirm both apply to your situation)
- Primary residence only — no investment properties
- Homebuyer education course required for Great Choice Plus DPA
- Down payment: THDA covers part via Great Choice Plus, but some cash may still be needed for closing costs depending on program
Income and purchase price limits are set by county and updated periodically by THDA. I check your county's current limits during a free consultation — these figures change and are not listed here to avoid quoting stale numbers.
What THDA does NOT cover — things to know before applying
THDA is not a direct lender. It offers the program through approved lenders like me. The interest rate on a Great Choice loan is set by THDA, not by your lender — and it may be slightly above the open market rate for conventional financing. The trade-off is the built-in down payment assistance and the first-time buyer benefit. For buyers who need help with the down payment gap, it is often the right call. For buyers who qualify for VA or USDA and need zero down but no assistance, those programs are often cheaper overall. I help you compare both paths, not just sell you one.
