Anthony Larosa/Eyeem/Getty Images
Do you shop for your first home on the land of Lincoln? Median home prices in Illinois rose by about 7% year-on-year, up at $285,600, but are still well below the national median. That’s good news First-time home buyer.
Still, coming up with cash for a down payment can be a challenge, especially if you’ve never bought it before. Fortunately, Illinois Department of Housing Development (IHDA) offers programs that help qualified buyers pay advance costs for homeownership.
Illinois’ first home buyer program
IHDA access mortgage
IHDA’s authorized mortgage program has a 30-year mortgage (which could be government-supported or traditional loans) with unacceptable loans for up to 4% of the home’s purchase price. The assistance can be used for down payments and closing costs, and closes at $6,000. No monthly payment is required. Additionally, if the home remains your primary residence for 10 years, the amount will be allowed.
IHDA Access Deferred Home Loan
Similar to IHDA Access Forgivable, the program offers a 30-year fixed-rate loan with down payments and closure costs assistance. In this case, eligible borrowers can receive up to 5% of the purchase price of the home for up to $7,500. This assistance is a profit-free loan that you don’t need to sell, refinance, or repay at the end of your mortgage term.
IHDA Access Repayment Mortgage
The IHDA program also includes a 30-year fixed-rate mortgage and assistance with down payments and closure costs. Borrowers can qualify for a profitless loan of up to 10% (below $10,000) of the purchase price of the home, which they pay back each month over a 10-year term.
City-specific Home Buyer Support Program
Chicago: CHA Down Payment Support
If you receive support from the Chicago Housing Authority, you will be eligible for a $20,000 grant for down payment and closing costs. Please note that if you receive a grant, you will not receive the grant. Other Illinois residents can qualify for up to $10,000.
Chicago: CHA chooses to own
Allows Chicago Housing Authority residents who are eligible to choose to own a home with housing subsidies to apply to their home purchases. Participants will receive monthly support for mortgage payments for up to 15 years, 30 patriarchs, disabled or elderly people, and support for home and post-home education, credit counseling and connections with real estate professionals.
Cook County: Down Payment Support Program
The program offers subsidies of up to 5% of the home’s purchase price, or $25,000, whichever is less, to be used for down payments, closing costs and buying. If the home remains your primary residence for five years, assistance is permitted.
Other Illinois First Home Buyer Loans
In addition to IHDA and other Illinois-specific programs, you can explore nationally available loan options that help many first-time buyers, including:
- FHA loan: Loans insured by the Federal Housing Administration (FHA) have more generous financial requirements than other loans. If you have a low credit score of 580, you will qualify for just 3.5% down on your FHA loan.
- VA loan: For eligible active duty veterans, veterans, and surviving spouses, the U.S. Veterans Affairs Office (VA) guaranteed loans are a great option. These loans usually come with low interest rates and do not require a down payment.
- USDA loan: The USDA-guaranteed loans do not require a down payment either, but must be purchased in designated rural areas to meet income restrictions.
- Possible Home Ready and Home Loans: HomeReady and Home is a loan program created by government-sponsored companies Fannie Mae and Freddie Mac. They are especially for first-time home buyers, with just 3% down and require more flexible income requirements.
Let’s get started
After investigating First-time home buyer Prepare for homeownership by following the program, these other steps.
- Compare mortgage rates in Illinois: You could potentially get a better deal by shopping with at least three lenders.
- Read reviews of Illinois mortgage lenders: The rate is important, but it’s just a part of the photo. The review provides a preview of lender communication, expertise and other factors.
- Shop for Illinois Homeowner Insurance: In most cases, homeowner premiums form part of monthly mortgage payments. Comparing a few insurers, you can find the coverage you need at a competitive price.
- Studying the Illinois housing market: This may help you to better understand where you can afford to buy and where you are eligible for assistance. Qualified real estate agents with experience with first-time buyers can help with this.
- Working on your credit score: It affects whether you are approved for your mortgage and your mortgage rate. You can save money by improving before applying.
