Best Mortgage Lenders for First Time Home Buyers in Arkansas

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Contributor, Benzinga
February 18, 2022

Are you getting ready to buy your first home in the Natural State? We’ll help you zoom in on the best mortgage lender so you get the best mortgage for your needs.

Best Mortgage Lenders in Arkansas for First Time Home Buyers

The Housing Market in Arkansas: An Overview

It’s important to take a look at your local housing market before you choose a mortgage lender. Understanding your local market can give you a better idea of what to expect when you finance your home. Here are a few Arkansas facts: 

Total households: 1,042,696

Median list price: $204,900

3 most expensive cities in Arkansas to buy a house:

  • Bentonville median home value: $259,568
  • Fayetteville median home value: $238,450
  • Conway median home value: $178,017

3 most affordable cities in Arkansas to buy a house:

  • Jonesboro median home value: $137,140
  • Fort Smith median home value: $117,158
  • Hot Springs median home value $115,959

Understanding the median home values throughout Arkansas will help you better prepare for typical listing prices in the Natural State.

Preparing for a Mortgage

You’ll need to know a few key pieces of information before you get started. We’ll walk you through the application process and help you pick up some important insights along the way.

The First Time Home Buyer’s Mortgage Process in Arkansas

The home loan preparation process is the same whether you’re a new or existing homeowner. Take a look at your financial situation so you know where you stand before you look for a lender. You should:

  • Know how much of a down payment you can bring to the table. Most mortgage types and lenders have down payment requirements, so it’s good to know how much you can afford to put down on your home before you apply. A higher down payment usually helps you lock in a better mortgage or interest rate, which can save you money throughout the lifetime of your loan.
  • Know your latest credit score. Lenders look at your credit score and credit history when they approve you for a mortgage. Your credit score also determines your mortgage rate. Different lenders have different credit score requirements. Typically, the higher your score, the lower your mortgage rate will be.

What You’ll Need

Next, you’ll want to prepare all of the paperwork you’ll need to begin the application process. Doing this can save time during the home loan process. Here’s what you’ll need to prepare before you apply.

  • Your Social Security number
  • Tax information from the past 2 years
  • Pay stubs from the past 2 months
  • The total amount of money you have in your accounts (checking, savings, retirement and other investment accounts)

Additional paperwork could be required, depending on the lender you choose.

LenderMinimum Credit Score Required
Rocket Mortgage®620
Chase620
PNC700
Bank of America620
AllyN/A (no minimum credit score)

Mortgage Options

First time home buyers should understand the different types of mortgage options available. We’ll walk you through the 5 top mortgage types available for Arkansas homebuyers. 

Conventional Loan

Conventional loans are funded through financial institutions like banks and credit unions. They often have higher interest rates and aren’t backed by the federal government. It’s often easier to qualify for conventional loans since they have more flexible eligibility requirements.

FHA Loan

FHA loans, designed for first time homebuyers, are funded through the Federal Housing Administration. FHA loans offer lower-than-market mortgage rates, have low down payment minimums (3.5%) and low credit score requirements (starting at 580). Most conventional lenders offer FHA loans.

USDA Loan

The U.S. Department of Agriculture funds USDA loans for any home purchased in a rural area (outside of a major city) in Arkansas. USDA loans offer lower-than-market interest rates, no down payment options and low credit score requirements (starting at 640). Many major lenders conventional lenders also offer USDA loans.

VA Loan

The Department of Veteran Affairs offers VA loans for current or former military members and their families. VA loans offer lower-than-market interest rates, no down payment options and have no credit score requirements, except when specified by a lender. Many major conventional lenders and VA-only lenders provide VA loans.

Jumbo Loan

Jumbo loans finance homes over $484,350 (this limit could be higher depending on your location). Jumbo loans are conventional or FHA loans that often have higher credit score requirements and larger down payment minimums. Most lenders expect 20% down payments for jumbo loans but online lenders like Quicken Loans® only require 10%.

First Time Home Buyer Programs in Arkansas

The Arkansas Development Finance Authority (ADFA) offers a variety of programs designed to help first time homebuyers afford a first home. These grants and assistance programs can typically be used with most mortgage types, like FHA loans.

  • ADFA Down Payment Assistance Program: This down payment assistance program (DPA) can provide up to $10,000 in down payment and closing cost aid. The DPA works as a second mortgage and allows you to take out another home loan for a down payment.
  • ADFA Down Payment Initiative (ADDI): ADDI allows lower-income Arkansas residents to finance a down payment (up to $10,000) through an assistance loan with no monthly payment requirements. This is forgiven after 10 years. You must meet income requirements to qualify and you’re responsible for the full loan if you move before the 5-year grace period ends.
  • ADFA Move Up Loan Program: This first time homebuyer mortgage offers low rates for qualifying Arkansas residents. This loan program is offered by conventional, FHA, USDA and VA lenders and can be combined with either down payment program.

Current Mortgage Rates in Arkansas

Your mortgage rate is the interest rate you’ll pay throughout the duration of your home loan. Securing a lower mortgage rate will save you thousands on your home loan over time.

Your lender uses a few different factors to determine your mortgage rate: your credit score, your down payment amount, your home location and your mortgage type and term.

There are 2 main types of mortgage terms to choose from: fixed and adjustable. Fixed mortgages have a set amount you pay each month over a specified term (or the length of your mortgage). Adjustable mortgages (ARMs) may have a set amount paid during an introductory period. Afterward, your rate fluctuates with the market and you will pay a different amount each month.

Mortgage rates in the Natural State can vary across cities, depending on the health of the local market. We’ve compiled the most up-to-date information on Arizona mortgage rates so you can look at approximate rates based on mortgage terms. 

Loan TypeRateAPR
30-year fixed N/A N/A
15-year fixed N/A N/A
7/1 ARM (adjustable rate) N/A N/A
5/1 ARM (adjustable rate) N/A N/A
Rates based on an average home price of $128,101 and a down payment of 20%.
See more mortgage rates on Zillow

Closing a Mortgage

Closing is the final step in the mortgage process. At this stage, you’ll sign all documents, review your information and confirm the terms of your home loan. Your down payment and closing costs will also be due at this time.

You’ll typically walk through your home to verify it’s in the agreed-upon condition during closing. You’ll also meet with your real estate agent to finalize all of your financial paperwork. You’ll receive the keys to your new home once all documents are signed and funds are paid.

The closing process takes between 30–45 days, though it can vary by lender. Online lenders like Quicken Loans® can condense this timeframe, thanks to faster approvals and verifications.

Here are typical closing day expectations based on top lenders in Arkansas.

LenderAverage Days to Close Loan
Quicken Loans®30 days
Bank of America45 days
Discover Home Equity45 days
better.com21 days
SunTrust60 days

Get Ready to Buy Your First Home in Arkansas

Take your time as you search for the best lender for your financial situation. Locking in a low rate can save you money in the long run but finding a lender that can offer you what you need most is even more important.

Get Ready for Take Off

Rocket Mortgage® is an online mortgage experience developed by the firm formerly known as Quicken Loans®, America’s largest mortgage lender. Rocket Mortgage® makes it easy to get a mortgage — you just tell the company about yourself, your home, your finances and Rocket Mortgage® gives you real interest rates and numbers. You can use Rocket Mortgage® to get approved, ask questions about your mortgage, manage your payments and more.

You can work at your own pace and someone is always there to answer your questions — 24 hours a day, 7 days a week. Want a fast, convenient way to get a mortgage? Give Rocket Mortgage® a try.