Assigned to FIN FOR COMMITTEE
ARIZONA STATE SENATE
Fifty-Seventh Legislature, First Regular Session
FACT SHEET FOR S.B. 1729
first time homebuyer assistance program
Purpose
Requires the Arizona Finance Authority (AFA) to establish the First-Time Homebuyer
Assistance Program and caps the assistance to each homebuyer at $20,000. Requires the
First-Time Homebuyer Assistance Program monies to be reimbursed by the recipient over 30 years
with no interest. Sets the maximum purchase price at $450,000 or an amount set by the AFA.
Prescribes property sale or refinance requirements and reporting requirements.
Background
The AFA is established within the Office of Economic Opportunity and strengthens
Arizona communities by offering innovative, responsible and sustainable financing solutions for
public and private borrowers. The AFA offers certain finance programs, including the: 1) Greater
Arizona Development Authority (GADA), which assists Arizona communities and tribal
governments with the development of public infrastructure projects; 2) the Industrial Development
Authority (IDA), which provides low-cost access to capital for affordable housing, nonprofits and
other businesses; and 3) HOME Plus Arizona, the Homebuyer Down Payment Assistance Program
(AFA).
The AFA's assets consist of any monies, pledges or properties issued or given to the AFA
through appropriation, loan, gift or otherwise. All costs and expenses of the AFA are paid from
bond proceeds or bonds issued by the IDA and monies of the GADA, to the extent not prohibited
by state or federal law or contract (A.R.S. ยง 41-5355).
There is no anticipated fiscal impact to the state General Fund associated with this
legislation.
Provisions
1. Requires the AFA to establish and administer the First-Time Homebuyer Assistance Program
and, subject to available monies, distribute the First-Time Homebuyer Assistance Program
monies to:
a) a first-time homebuyer to provide support for the purchase of a qualifying residential unit;
and
b) reimburse the AFA for the distribution of the First-Time Homebuyer Assistance Program
monies.
2. Caps the assistance amount that a first-time homebuyer may receive at $20,000. FACT SHEET
S.B. 1729
Page 2
3. Requires the First-Time Homebuyer Assistance Program monies received by a first-time
homebuyer to be paid back over a 30-year period at zero percent interest and requires repaid
monies to be used for First-Time Homebuyer Assistance Program distributions.
4. Allows a recipient to use the First-Time Homebuyer Assistance Program monies to pay for
any combination of the following:
a) a down payment on a qualifying residential unit;
b) the closing costs associated with the purchase of a qualifying residential unit; or
c) a permanent reduction in the advertised par interest rate on a qualifying mortgage loan that
is used to finance a qualifying residential unit.
5. Prohibits a recipient from receiving First-Time Homebuyer Assistance Program monies after
closing.
6. Prohibits a builder or developer of a qualifying residential unit from increasing the price of the
qualifying residential unit based on First-Time Homebuyer Assistance Program monies being
used for the purchase.
7. Allows the AFA to establish one or more purchase prices corresponding to the residential unit
type, the geographic location or any other factor deemed relevant by the AFA and allows the
AFA to adjust a maximum purchase price only once each calendar year.
8. Allows the AFA to adjust the maximum purchase price of a qualifying residential unit for
which a first-time homebuyer qualifies to receive First-Time Homebuyer Assistance Program
monies to reflect current market conditions.
9. Stipulates that, if a recipient sells the qualifying residential unit or refinances the loan that was
used to finance the purchase of the unit before the end of the original loan term, the recipient
must repay the AFA an amount equal to either the amount of monies received from the AFA
or 50 percent of the recipient's home equity amount, whichever is lesser.
10. Specifies that the requirement to repay the AFA does not apply to a qualifying mortgage loan
that is refinanced with a new qualifying mortgage loan, if any subordinate qualifying mortgage
loan or loan from the First-Time Homebuyer Assistance Program that was used to finance the
home purchase is resubordinated to the new qualifying mortgage loan.
11. Caps, at five percent of First-Time Homebuyer Assistance Program monies, the monies the
AFA may use to administer the First-Time Homebuyer Assistance Program.
12. Requires the AFA to adopt rules governing the forms, process and criteria the AFA must use
to distribute program monies to first-time homebuyers.
13. Requires the AFA, by September 1 of each year, to report to the President of the Senate, the
Speaker of the House of Representatives and the Governor and provide a copy of the report to
the Secretary of State on the activities of the First-Time Homebuyer Assistance Program during
the prior fiscal year, including disbursements and any adjustments made to the maximum
purchase price of a qualifying residential unit. FACT SHEET
S.B. 1729
Page 3
14. Defines first-time homebuyer as an individual who meets the federal requirement to have not
owned a home within three years and the requirements prescribed by AFA rule and includes a
single parent who no longer has a present ownership interest or resides in a principal residence
and who would otherwise meet the three-year requirement, except that the single parent:
a) had a present ownership interest in a principal residence with the single parent's former
spouse during the three-year period; or
b) resided in a principal residence while married during the three-year period.
15. Defines qualifying residential unit as a house, condominium, townhome or similar residential
structure that serves as a one-unit dwelling or forms part of a two-unit dwelling, including a
manufactured home or modular home that is attached to a permanent foundation, and that is
all of the following:
a) located in Arizona;
b) either an existing residential unit or is newly constructed but not yet inhabited;
c) financed by a qualifying mortgage loan;
d) owner-occupied or has at least one unit that is owner-occupied within 60 days of purchase;
and
e) purchased for an amount that does not exceed either $450,000 or the maximum price, if
any, established by the AFA.
16. Defines terms.
17. Becomes effective on the general effective date.
Prepared by Senate Research
February 12, 2025
MG/KP/ci