THDA Great Choice Home Loan
Tennessee Housing Development Agency's flagship mortgage program. Great Choice provides a below-market 30-year fixed interest rate for qualifying first-time buyers across Tennessee, paired with FHA, VA, USDA, or conventional financing.
What Great Choice offers
The Great Choice Home Loan is a 30-year fixed-rate mortgage at a below-market interest rate set by THDA. The rate is typically below the prevailing market rate for the same loan type, which reduces the monthly payment and the total interest paid over the life of the loan. The rate is fixed for the full 30-year term.
Great Choice is not a standalone loan product — it is an interest rate benefit layered on top of an FHA, VA, USDA, or conventional loan. The underlying loan program determines the down payment requirement, mortgage insurance structure, and property eligibility. Great Choice provides the rate benefit.
Who qualifies for Great Choice
Great Choice is designed for first-time home buyers — defined as those who have not owned a primary residence in the past three years. There are exceptions for buyers in federally designated targeted areas and for certain other circumstances.
Additional requirements include:
- Household income at or below THDA's limits for your county (limits vary by county and household size)
- Purchase price at or below THDA's limits for your county
- The home must be your primary residence
- Completion of a THDA-approved homebuyer education course
- Credit score meeting the requirements of the underlying loan program (FHA, VA, USDA, or conventional)
Great Choice with different loan programs
Great Choice + FHA
The most common combination. FHA's 3.5% down payment requirement applies. Great Choice provides the below-market rate. Can be paired with Great Choice Plus for down payment assistance.
Great Choice + VA
Zero down payment with a below-market rate. Available for eligible veterans and active-duty military. No PMI. The VA funding fee applies unless waived.
Great Choice + USDA
Zero down payment for eligible rural properties with a below-market rate. USDA income and property eligibility requirements apply in addition to THDA's requirements.
Great Choice + Conventional
Available for buyers who prefer conventional financing. Typically requires a higher credit score than FHA. PMI applies with less than 20% down but is cancellable.
How THDA rates compare to market rates
THDA sets its Great Choice rate periodically based on bond market conditions. The rate is typically below the prevailing market rate for the same loan type, but the margin varies. In some market environments, the benefit is significant; in others, it may be modest. Morgan Hardy can compare the current Great Choice rate against market rates for your specific situation to determine whether the program offers a meaningful advantage.
Check your Great Choice eligibility
Morgan Hardy is a THDA-approved lender and can verify your eligibility for the Great Choice program and compare it against other available financing options.
Contact Morgan Hardy