Illinois First-Time Homebuyer Programs of 2019

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Updated on Wednesday, February 6, 2019

Buying your first home can be both exciting and scary. You’re ready to stop renting and start building equity, but the process — and the costs involved — can be overwhelming. If your goal is to build a life in Illinois, however, you do have one thing working in your favor: you may qualify for some help. The Illinois Housing Development Authority (IHDA) offers a wide range of programs that can help you purchase a home with better terms, provided you meet their guidelines. While some programs provide down payment assistance, others offer loans that may be forgivable under certain circumstances.

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We created this guide to help consumers learn about the first-time homebuyer programs available in Illinois in 2019. If you’re eager to purchase a home this year, yet you need some assistance, keep reading to learn more.

Illinois first-time homebuyer programs

The Illinois Housing Development Authority is the state agency helping consumers find affordable housing in the state. Its stated goal is “financing the creation and preservation of affordable housing in Illinois,” and it achieves this goal through a variety of programs geared toward potential homeowners who may not be able to purchase a home without help.

The IHDA offers programs that help Illinois residents purchase a home, receive financial counseling or pay for much-needed upgrades and repairs. Its I-Refi program also helps homeowners refinance their current mortgage when they owe more than their home is worth.

Eligibility for Illinois assistance

Consumers who wish to apply for an Illinois homeowner program need to reside in the state. You also need a minimum credit score of 640 to qualify for an IHDA loan. If your credit score isn’t high enough to qualify, the agency offers counselors who can offer guidance and tips to improve your credit rating over time.

It’s important to note that you’ll also need to meet income requirements for IHDA loans, though they vary by county and household size. Generally speaking, income limits range between $77,900 and $114,840, depending on the county you live in, how many adults live with you, and other factors.

There are also loan limits that determine how much you can borrow. For a single-unit residence, these limits vary between $271,164.60 and $336,706.20, depending on the county the home is located in.

Keep reading to learn more about each program available in the state, how they work and what it takes to qualify.

IHDAcess Deferred

The IHDAccess Deferred program offers Illinois residents who qualify a 30-year mortgage with competitive interest rates, as well as an interest-free loan you can use toward your down payment and closing costs. This program is available to first-time and repeat buyers in the state.

Features

The IHDAccess Deferred program features

  • Up to $7,500 in assistance toward your down payment and closing costs, with a cap of 5% of the loan amount
  • A 30-year mortgage with a fixed interest rate that is competitive
  • The ability to use this program with several mortgage types, including FHA loans, VA loans, USDA loans and more
  • You don’t need to repay your loan assistance until you sell your home, refinance or pay off your mortgage

Eligibility

To qualify for this program, you must

  • Be able to contribute $1,000 or 1% of the purchase price (whichever is greater) toward your home
  • Meet income and purchase price guidelines that vary based on county and household size
  • Purchase an existing home or new construction
  • Have a credit score of 640 or higher
  • Plan to live in the home as your primary residence
  • Be willing to complete homeownership counseling before you close on the loan (either in person or online)

How it works

If you’re interested in this program and feel you meet the requirements, your first step is to speak with an IHDA lender. The lender will take a close look at your financial situation to help you determine if this program is right for your needs. Once you begin working with an IHDA lender, the IHDA steps aside and lets the process move forward.

IHDAccess Forgivable

The IHDAccess Forgivable program combines a 30-year mortgage with down payment and closing cost assistance. However, the assistance component does not need to be repaid if you live in the home for at least 10 years. This program is available to first-time homebuyers as well as repeat buyers.

Features

The IHDAcess Forgivable program offers

  • A fixed-rate mortgage with a competitive interest rate
  • Closing cost and down payment assistance up to $6,000 or 4% of the purchase price of your home
  • The ability to use this program with several mortgage types, including FHA loans, VA loans, USDA loans and more

Eligibility

To qualify, you must

  • Be willing to contribute up to $1,000 or 1% of the purchase price, whichever is greater
  • Meet income and purchase price requirements based on household size and county
  • Have a credit score of 640 or higher
  • Plan to live in the home as your primary residence
  • Complete homeownership counseling before you close on the loan (either in person or online)
  • Purchase an existing home or new construction

How it works

Like other IHDA loan programs, the housing authority isn’t actually involved in the loan process. Instead, it urges you to connect with a lender that offer IHDA loans.

Once you find a lender in your area, the lender will go over your financial details and help you determine if you qualify.

IHDAccess Repayable

If you qualify for this program, you’ll receive a 30-year mortgage with a competitive interest rate, as well as up to $10,000 (or 10% of your loan amount) in assistance toward closing costs and your down payment.

The assistance component comes in the form of an interest-free loan that is repaid over 10 years. Like other loans on this list, this program is available to new homeowners as well as repeat buyers. It can be used for existing homes or new construction.

Features

The IHDAccess Repayable program offers

  • An interest-free loan of up to $10,000 or 10% of the purchase price of your home to use toward your down payment or closing costs
  • A 30-year fixed rate mortgage with a competitive APR
  • The ability to use this program with several mortgage types, including FHA loans, VA loans, USDA loans and more

Eligibility

Illinois residents may qualify if they

  • Meet income and purchase price requirements based on their household size and the county where the home is located
  • Have a credit score of 640
  • Are willing to contribute up to 1% of the purchase price or $1,000 (whichever is greater)
  • Live in the home as their primary residence
  • Are willing to complete homeownership counseling before they close on their loan (in-person or online)
  • Purchase an existing home or new construction

How it works

The application process for this type of loan works similarly to other IHDA programs. The agency asks you to contact an IHDA-approved lender, who will take a look at your finances and help you determine your best course of action. The IHDA does not handle loans directly.

1stHomeIllinois

The 1stHomeIllinois program combines a down payment assistance grant with a long-term fixed-rate loan. This program is available to first-time homebuyers, military veterans, and individuals who haven’t owned a home in the last three years.

Features

With the 1stHomeIllinois program, you can

  • Receive up to $7,500 in down payment and closing cost assistance
  • Get a 30-year mortgage with a fixed interest rate
  • Use this program with several mortgage types, including FHA loans, VA loans, USDA loans and more

Eligibility

To qualify, you must:

  • Purchase a one- or two-unit property in the following Illinois counties: Cook, Marion, St. Clair or Winnebago
  • Be a military veteran, a first-time homeowner or someone who hasn’t owned a home for at least three years
  • Purchase an existing home (new construction is not allowed)
  • Live in the home as a primary residence
  • Have a credit score of 640 or higher
  • Be willing to complete in-person or online homeownership counseling before the loan closes
  • Be able to contribute up to $1,000 or 1% of the purchase price of the home, whichever is greater
  • Meet income and purchase price guidelines based on county of residence and household size

How it works

Illinois residents interested in this program should start the process by looking for an IHDA lender. Once you meet with a lender and provide them with your financial information and personal details, they can gauge your eligibility for the 1stHomeIllinois program or help you find a IHDA loan program that might work better for you.

National first-time homebuyer programs

While the programs above can be extremely helpful for Illinois residents who can qualify, keep in mind that there are plenty of other home loans to consider. You may also want to look into FHA loans or USDA loans, or even VA loans if you’re a qualified veteran.

The LendingTree guide to first-time homebuyer programs can also introduce you to additional programs that may fit your needs. With enough research and preparation, you could be in your dream home in no time.

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