How to Buy a Home in Hope, Arkansas: Mortgage Options, Down Payment Help & First-Time Buyer Programs
People who read our Living in Hope page often call the chamber with a follow-up question. They want to know how to buy a home in Hope, Arkansas without years of saving first. A house at the local median price needs a loan of about $90,000. Federal and state programs lend on a house of that size without a down payment, or with a small one.
Why Hope, Arkansas Is One of the Most Affordable Places to Buy
The Census Bureau puts the median value of an owner-occupied house in Hope at $91,900. Borrow that amount, and the monthly payment comes out close to what tenants in Hope already pay in rent, even at today’s higher interest rates.
Hope AR mortgage rates and the monthly payment
Mortgage rates in Hope follow the national average. Local banks price their loans from the same markets as everyone else. On September 24, 2026, Freddie Mac put the average 30-year fixed rate at 7.03%. A year earlier it was 6.30%. Rates change that much within a year, so we worked out the monthly cost of a $90,000 house at two rates, 6.5% and 7%, on a 30-year fixed USDA loan with nothing down. The rent line is the Census gross rent, utilities included. The $500 on our relocation page is rent alone.
| Monthly cost of a $90,000 house | At 6.5% | At 7% |
| Principal and interest | ~$575 | ~$605 |
| USDA annual fee | ~$27 | ~$27 |
| Property tax inside the city limits, after the homestead credit | ~$25 | ~$25 |
| Homeowners insurance, upper estimate at the Arkansas average for homes of every value | ~80-145 | ~80-145 |
| Total before utilities | ~705-770 | ~735-800 |
| Median gross rent in Hope, utilities included (Census, 2020-2024) | $823 | $823 |
| Loan balance repaid during the first year | ~$1,015 | ~$925 |
An owner pays utilities on top of that total, so owning will cost a little more each month than renting, by roughly what the utilities cost. Part of that difference comes back, though. Close to a thousand dollars of the first year’s payments goes toward the loan balance, and rent money is gone for good. A fixed-rate payment is also the same in year 30 as in year one. Rent can go up at every renewal.
The property tax line is small because Arkansas taxes only a fifth of a home’s market value. The rate on that fifth is quoted in mills. One mill is $1 of tax per $1,000 of assessed value. An owner who lives in the house then takes the homestead credit off the result. Under Amendment 79, the taxable value of a homestead can’t rise more than 5% a year, so one reassessment can’t double your tax.
| Hempstead County property tax on a $90,000 home in Hope (chamber calculation) | Amount |
| What the house is worth | $90,000 |
| What the county assesses, a fifth of that | $18,000 |
| Tax at 49.7 mills inside the city limits (2025 millage) | ~$895 a year |
| Less the 2026 homestead credit | -$600 |
| What the owner pays | ~295ayear,or~25 a month |
USDA Rural Development Loans: Zero Down Payment in Hempstead County
USDA treats a town of 10,000 or fewer people as rural. Hope had 8,952 residents at the 2020 Census, which puts every house in town inside the program. Eligibility is still confirmed address by address by Rural Development, so we advise you to check the exact property on the USDA eligibility map before you make an offer.
Banks and mortgage companies in Hempstead County offer the USDA guaranteed loan. The bank puts up the money. USDA promises to repay 90% of it if the borrower defaults, which is what lets a bank accept a buyer who has no savings. USDA charges a guarantee fee for that promise. The upfront part is usually added to the loan balance. The yearly part is collected with each monthly payment.
Households under the low-income limit can apply for a direct loan, where USDA itself is the lender. Payment assistance can lower the effective interest rate to as low as 1%. The application for this one goes to the Rural Development office itself, 300 W. Commerce Blvd., Suite D in Hope. A loan specialist there can go through the forms with you in person.
A typical household here earns about $46,800 a year, the Hempstead County median. The limits in the table are far above that, so most local buyers will qualify for the guaranteed loan, and many for the direct loan and its payment assistance too.
| USDA home loans in Hempstead County (income limits dated July 13, 2026) | Guaranteed loan | Direct loan |
| Lender | USDA-approved lender | USDA Rural Development |
| Household income limit, 1-4 people | $122,800 | $56,900 |
| Household income limit, 5-8 people | $162,100 | $75,150 |
| Down payment | None | None in most cases |
| Interest rate | Set by the lender | 5.25% since September 1, 2026 |
| Term | 30 years, fixed rate | 33 years, or 38 for very low incomes |
| Guarantee fee | 1% upfront and 0.35% a year | Not charged |
| USDA loan limit | None | $324,700 |
| Where to apply | Bank or mortgage company | Hope Area Office, 870-777-8800, ext. 4 |
FHA and Conventional Loans for a $90,000 House
Suppose your credit score is modest and your savings end at a few thousand dollars. An FHA loan was written for that buyer. Your bank still lends the money, and if you ever stop paying, the Federal Housing Administration makes the bank whole. Knowing that, a bank will take 3.5% down and a credit score in the 600s. A conventional loan has nobody standing behind it, so the bank judges you on your credit record and your cash and prices the loan on those alone.
The options differ in the cash you need at closing and in how long you pay for mortgage insurance. The table compares them for a $90,000 purchase at 7%.
| Loan on a $90,000 house (chamber calculation at 7%) | FHA, 3.5% down | Conventional, 5% down | Conventional, 20% down |
| Down payment | $3,150 | $4,500 | $18,000 |
| Loan amount | ~$88,400 with the upfront premium | $85,500 | $72,000 |
| Principal and interest | ~$588 | ~$569 | ~$479 |
| Mortgage insurance | ~$40 a month | ~25-60 a month, priced by credit score | None |
| When the insurance ends | Lasts for the whole loan term | At 78%-80% of the original value | Not applicable |
FHA is the better choice if your credit score is on the low side, because its premium doesn’t go up with a weaker score. The same is true if the down payment would empty your savings. Strong credit points the other way, toward a conventional loan, since its insurance ends after a few years of payments. An FHA premium on a small down payment lasts the whole term. If you have no savings at all, a USDA loan or an ADFA second mortgage is a stronger option than either, because neither needs cash for the down payment.
Credit scores and 3% down options
| FHA rule | Detail |
| Minimum credit score for 3.5% down | 580 |
| Credit score of 500-579 | 10% down |
| Appraisal | House must meet HUD’s minimum property standards |
| 2026 loan limit, Hempstead County | $541,287 |
The credit score is checked when you apply. The house itself is checked at the appraisal. An FHA loan in rural Arkansas has to meet HUD’s property standards, so a damaged roof or peeling paint on an older house can produce a repair condition. The seller or the buyer has to clear it before closing. The loan limit is several times the price of a typical house here and won’t come into play.
Good credit but little cash? A conventional loan with 3% down exists for that case. HomeReady from Fannie Mae and Home Possible from Freddie Mac accept it when the household earns no more than 80% of the area median. Over the years such a loan usually costs less than FHA, though the credit standards at approval are stricter.
Arkansas Down Payment Assistance (ADFA)
Arkansas down payment assistance comes from ADFA, the Arkansas Development Finance Authority, though you’ll never deal with the agency directly. Private lenders fund and service its first mortgages. A borrower who takes one can add a second mortgage from ADFA to pay the down payment, the closing costs, or the taxes and insurance collected at closing. The second loan has its own monthly payment, spread over 10 years at the same interest rate as the first.
The income limits for Hempstead County are lower for the first-time buyer program than for Move-Up. A household above the StartSmart limit can still use Move-Up. The down payment assistance is available with either.
| ADFA program (guidelines revised June 10, 2026) | StartSmart | Move-Up | Down Payment Assistance |
| Type | First mortgage | First mortgage | Second mortgage |
| Who may apply | First-time buyers and veterans | Any buyer | StartSmart and Move-Up borrowers |
| Household income limit in Hempstead County | $85,320 for 1-2 people, $99,540 for 3 or more | $142,000 | Follows the first mortgage |
| How much | A purchase price up to $500,000 | Up to the conforming loan limit | 1,000-15,000 (~$58 a month on $5,000 at 7%) |
| Credit score needed | 640 | 640 | 640, as for the first mortgage |
Who ADFA counts as a first time home buyer in Arkansas
More people than the name suggests. Anyone who hasn’t owned a principal residence during the past three years qualifies. A person who sold a house four years ago and rented since then meets the rule again.
How to apply
An ADFA first mortgage can be an FHA, VA, USDA Rural Development, or Freddie Mac conventional loan. As a result, a Hope buyer can pair a zero-down USDA loan with ADFA assistance for closing costs. Approval also depends on your debts, because ADFA limits total monthly debt payments, the new mortgage included, to 45% of income.
You apply through a participating lender. The participating loan officers nearest Hope are in Nashville, Arkansas, about 30 miles northwest on Highway 278, and in Texarkana, about 35 miles southwest on I-30. Bank OZK is on ADFA’s lender list and has a branch in Hope, although its listed loan officers work from Little Rock. If you prefer another bank in town, you can ask whether it takes part or call ADFA at (501) 682-5900.
Local Lenders in Hope
Six banks operate seven offices in Hope, according to FDIC records, and a credit union has a branch here as well. Phone numbers and hours for each of them are in the Banking and Finance category of our business directory. We checked each one against the USDA lender list and the ADFA lender search in September 2026.
| Lender with an office in Hope | Address | Program approvals we could confirm |
| Farmers Bank & Trust | 201 E. 3rd St. and 617 N. Hervey St. | On the USDA guaranteed-lender list; advertises FHA and conventional loans |
| Bank OZK | 600 S. Main St. | On ADFA’s participating-lender list |
| Diamond Bank | 400 S. Main St. | Not on either list; ask the branch |
| First National Bank of Tom Bean | 301 N. Hervey St. | Not on either list; ask the branch |
| Bank of Delight | 1303 N. Hervey St. | Not on either list; home purchase and construction loans |
| Huntington National Bank (Cadence Bank until mid-2026) | 200 S. Elm St. | Not on either list; ask the branch |
| Red River Credit Union | 1513 Wal-Mart Dr. | USDA guaranteed lender; conventional and VA loans |
Only an approved lender can close a USDA loan in Hempstead County or an ADFA mortgage. The first question for any branch is which of these programs it offers. Rates differ from lender to lender as well. We advise you to collect every quote inside one 45-day window, because credit checks by mortgage lenders in that period count as a single inquiry on your credit report. A second or third quote won’t lower your score.
Steps to Close on a Home in Hempstead County
Once the seller accepts, a financed purchase in Hope usually closes within 30-60 days, the same range Freddie Mac reports nationwide. Where do the weeks go? Mostly to waiting, first for the appraiser and then for the title company. Once you know the order, you can give the landlord notice at the right time instead of guessing.
| Stage | Typical duration |
| Preapproval | 1-3 business days once the lender has your documents |
| Search and accepted offer | Depends on the listings available |
| Inspection | 2-5 days to schedule and complete |
| Appraisal ordered by the lender | 1-2 weeks |
| Title search and title insurance | 1-2 weeks, in parallel with the appraisal |
| Closing Disclosure to closing | At least 3 business days |
1. Apply for preapproval
The lender will review your income and credit record before you shop. Once you file a full application, the lender has three business days to deliver a Loan Estimate. The first page shows the rate and the cash you’ll need at closing. The layout is the same at every lender, so two or three estimates are easy to compare line by line.
2. Choose an agent and a house
The Real Estate category of the same directory lists the agencies that sell Hope, Arkansas real estate. If you plan to use a USDA or FHA loan, you should tell the agent before the search begins. The appraisal for those loans also checks the condition of the house. An older property with visible defects may need repairs before closing. An agent who knows this in advance can skip the houses that won’t pass.
3. Make a written offer
The offer is where a financed buyer writes in some protection. It should let you withdraw if the loan is refused, allow time for an inspection, and set a closing date the lender can meet. Arkansas doesn’t require earnest money to form a contract, although sellers expect it. Any deposit you pay should come with a written statement of who holds it and when it comes back to you. A request for the seller to pay part of your closing costs should go into the offer as well.
4. Order your own inspection
Sellers in Arkansas are under no legal duty to disclose a property’s condition. Many fill in a voluntary disclosure form anyway, and your agent can ask for it, but an inspection of your own is the more reliable source. You can choose an inspector from the state’s roster of registered home inspectors. The report will tell you what to negotiate before the appraisal.
5. Wait for the lender’s appraisal
The appraisal protects the lender. It is also the step most likely to delay a USDA or FHA purchase of an older house. If the value comes in below the agreed price, the seller may accept less, or you may pay the difference. If neither happens, the financing condition in your offer lets you withdraw. Any repairs the appraiser notes have to be finished before closing, by the seller or by you. The one exception is a lender that agrees to hold money in escrow until the work is done.
6. Clear the title
Hempstead County recorded deeds before Arkansas was a state. Land with two centuries of owners needs careful title work. A title company searches those records at the Circuit Clerk’s office in the courthouse.
Your lender will require a lender’s title policy. An owner’s policy is optional. It pays your legal costs and your loss if someone turns up later with a claim on the property.
7. Review the Closing Disclosure
Three business days before closing, or earlier, the lender sends the Closing Disclosure. Lay it next to your Loan Estimate. Any line that has grown since the estimate deserves a question before you sign.
| What a $90,000 purchase costs at closing | Amount |
| Lender, appraisal, and title charges | 2%-5% of the loan, roughly 1,800-4,500, with the transfer tax on top |
| Arkansas transfer tax at $3.30 per $1,000 | $297, divided as the contract states |
| Owner’s title insurance | Optional, quoted by the title company |
| Prepaid property tax and insurance | Depends on the closing date |
A buyer with little savings has several ways to pay these amounts without cash of their own. The most common is a contribution from the seller, which has to be negotiated in the offer at step 3.
| Source of closing-cost money | Limit |
| Seller contribution on a USDA loan | Up to 6% of the sales price |
| Seller contribution on an FHA loan | Up to 6% of the sales price |
| Seller contribution on a conventional loan | 3% of the price when the down payment is under 10% |
| ADFA Down Payment Assistance | Within the ADFA amount, repaid as the second mortgage |
| The USDA loan itself | Closing costs and the upfront fee, as long as the loan remains within the appraised value |
8. Sign and record the deed
At closing, you sign the loan documents and pay the remaining costs. The title company then records the deed with the Circuit Clerk.
9. Register the homestead
The homestead credit doesn’t apply by itself. Once you’ve moved in, you register the house as your principal residence with the Hempstead County Assessor at (870) 777-6190. The credit will appear on the first tax statement issued after your record is on file.