Memphis Down Payment Assistance Program

1. City of Memphis Down Payment Assistance (DPA)

The City of Memphis offers assistance for down payments and closing costs on homes purchased within Memphis city limits. Funds can significantly reduce the amount of cash needed at closing.

Programs include:

  • Citywide DPA – For income-qualified buyers purchasing within Memphis city limits.
  • Memphis Housing Authority DPA – For current or recently displaced Memphis Housing Authority residents.
  • HIPC (Homebuyer Incentive Program for Citizens) – Available in designated neighborhoods and allows substantially higher income limits than many traditional assistance programs.
  • HIPP (Homebuyer Incentive Program for Police Officers) – For qualifying Memphis police officers.
  • HIPF (Homebuyer Incentive Program for Firefighters) – For qualifying Memphis firefighters.
  • MSCS Homebuyer Incentive Program – For eligible Memphis-Shelby County Schools employees.

2. Tennessee Housing Development Agency (THDA)

The Tennessee Housing Development Agency Great Choice Home Loan is one of Tennessee’s most popular first-time homebuyer programs. It offers:

  • Fixed-rate 30-year mortgages.
  • Minimum credit score generally starting at 640.
  • Homebuyer education classes.
  • Down payment assistance options.
  • FHA, USDA, VA, and conventional loan options.

Great Choice Plus Down Payment Assistance

THDA also offers:

  • Up to 5% of the home’s purchase price (up to certain limits) toward down payment and closing costs.
  • Deferred-payment assistance options.
  • Assistance that can be used alongside eligible THDA mortgages.

3. Homeownership for Heroes Program

This THDA program provides additional benefits for:

  • Military members
  • Veterans
  • Teachers
  • Law enforcement officers
  • Firefighters
  • EMTs and paramedics

Benefits can include reduced interest rates and expanded eligibility.

4. FHA Loans

Many first-time buyers use loans insured by the Federal Housing Administration because they offer:

  • Down payments as low as 3.5%.
  • More flexible credit requirements.
  • Ability to combine with certain assistance programs.

5. VA Home Loans

Eligible veterans and active-duty service members may qualify for:

  • No down payment.
  • No private mortgage insurance (PMI).
  • Competitive interest rates.

6. USDA Rural Development Loans

Many areas surrounding Memphis qualify for USDA financing, which can offer:

  • 100% financing.
  • No down payment.
  • Competitive fixed rates.

7. Affordable Housing Development Programs

The City of Memphis funds affordable housing construction and rehabilitation programs that create below-market housing opportunities for income-qualified buyers. These programs are supported through federal HOME and CDBG funding and local housing initiatives.

8. Memphis Affordable Housing Trust Fund

The City invests in affordable housing developments through the Memphis Affordable Housing Trust Fund, helping increase the inventory of affordable homes available to qualified buyers.

9. Special Bank and Lender Programs

Some lenders operating in Memphis periodically offer:

  • 0% down-payment mortgages.
  • No PMI loan programs.
  • Neighborhood revitalization lending programs.
  • Community lending grants.

Availability changes frequently by lender and census tract.

10. Employer-Assisted Homeownership

Some Memphis employers offer homeownership assistance or partner with lenders to provide:

  • Homebuyer education.
  • Down payment grants.
  • Preferred mortgage programs.
  • Closing-cost assistance.

These vary by employer and should be explored through HR departments.

11. Section 8 Housing Choice Voucher Homeownership Program (SHAPE)

The Section 8 Housing Choice Voucher Homeownership Program allows eligible Housing Choice Voucher (Section 8) participants to use their housing assistance toward a mortgage payment instead of rent. Rather than renting indefinitely, qualified families can work toward becoming homeowners while continuing to receive housing assistance. Participation depends on whether the local housing authority offers the program and whether applicants meet eligibility requirements.

Potential Benefits

  • Monthly assistance applied toward mortgage payments.
  • Opportunity to build equity and generational wealth.
  • Transition from renting to homeownership.
  • Financial stability through fixed housing costs.
  • Long-term asset building.

Typical Requirements

  • Current Housing Choice Voucher recipient.
  • First-time homebuyer.
  • Employment and income requirements (with certain exceptions for elderly and disabled participants).
  • Completion of homebuyer education.
  • Mortgage lender approval.
  • Good standing with housing authority program requirements.

12. RISE Memphis Save Up Program (Often Referred to as the RISE Up Program)

The RISE Memphis Save Up Program is a matched-savings program designed to help low-to-moderate income individuals build assets and achieve homeownership. Participants complete financial education training, establish savings goals, and receive matching funds that can be used toward purchasing a home. RISE also provides credit-building assistance, budgeting education, and homebuyer preparation.

Program Benefits

  • Financial literacy and money management training.
  • Credit improvement assistance.
  • Matched savings account.
  • Savings matched at a 2:1 ratio.
  • Up to $3,000 available toward eligible asset purchases.
  • Homebuyer education workshops.
  • Homeownership coaching and support.

Eligibility

  • Memphis or Shelby County resident.
  • At least 18 years old.
  • Employed (preferably full-time).
  • Low-to-moderate income household.
  • Meet program savings requirements.
  • Minimum credit score requirements may apply for homeownership participants.

13. Operation HOPE Homeownership and Financial Wellness Programs

Operation HOPE is a national nonprofit organization that provides financial literacy, credit and money management coaching, and homeownership readiness support. In Memphis and surrounding areas, Operation HOPE partners with banks, employers, and communities to help individuals improve financial stability and become mortgage-ready.

Their programs are designed to move people from financial instability to financial independence, with a strong focus on credit repair, savings behavior, and homeownership preparation.

Key Services and Benefits

  • Free financial coaching and one-on-one money management support
  • Credit score improvement and debt reduction strategies
  • Homeownership readiness counseling
  • Assistance building savings habits and emergency funds
  • Banking and financial system education
  • Mortgage preparedness guidance
  • Small business and entrepreneurship support (in some programs)
  • Community-based workshops and employer partnerships

HOPE Inside / HOPE Coalition Banking Model

Operation HOPE often operates inside banks and community institutions through its HOPE Inside model, which places financial coaches directly where people already bank or access services. This makes it easier for clients to:

  • Improve credit in real time
  • Open or repair banking relationships
  • Get connected to mortgage lenders
  • Receive ongoing financial coaching

Role in the Homeownership Pipeline

Operation HOPE plays a foundational role in the homebuying journey by preparing individuals before they apply for programs like:

  • City of Memphis Down Payment Assistance
  • THDA Great Choice Loan Program
  • Section 8 Homeownership (SHAPE)
  • Affordable housing initiatives
  • Local matched savings programs like RISE Memphis Save Up