Illinois first-time homebuyer assistance programs
If you’re looking to buy a home in Illinois, you could have access to first-time homebuyer assistance programs that provide fixed-interest mortgages along with down payment and closing cost assistance loans. You’re considered a first-time homebuyer (and potentially eligible for these programs) if you haven’t owned a home in the past three years, but some programs assist all types of buyers.
Illinois first-time homebuyer programs and down payment assistance
Through its Access Mortgage program, the Illinois Housing Development Authority (IHDA) provides fixed-rate loans offered through a network of partner mortgage lenders.
IHDA mortgages don’t require a down payment, but you do need to contribute $1,000, or 1 percent of the purchase price, whichever is greater. However, you should make a down payment if you can afford it. Putting down at least 20 percent of the purchase price removes the requirement to purchase private mortgage insurance (PMI).
IHDA Access Forgivable Mortgage
IHDA’s Access Forgivable Mortgage program offers a fixed-rate 30-year mortgage — either a conventional, FHA, VA or USDA loan — with as much as 4 percent of the purchase price, up to $6,000, in closing costs and down payment assistance. This assistance loan doesn’t need to be paid back as long as you live in the home for at least 10 years.
To qualify, you’ll need a minimum credit score of 640 and a debt-to-income (DTI) ratio of 50 percent or less. You also need to meet certain income and purchase price limits that vary by county and household size.
IHDA Access Deferred Mortgage
IHDA’s Access Deferred Mortgage program also offers a 30-year fixed-rate mortgage and 5 percent of the purchase price, up to $7,500, in down payment and closing cost assistance. This assistance comes as an interest-free loan that you don’t need to pay back until your loan’s maturity date, or when you sell your home or refinance your mortgage.
To qualify for an IHDA Access Deferred Mortgage, you need a credit score of at least 640 and a DTI ratio of 50 percent or less. As with the IHDA Access Forgivable Mortgage, income and purchase price limits apply.
IHDA Access Repayable Mortgage
IHDA’s Access Repayable Mortgage package includes a 30-year fixed-rate mortgage and a loan for 10 percent of the purchase price, up to $10,000. Designed to help cover down payment and closing costs, this loan is repaid in interest-free monthly installments over a 10-year period. The Repayable program has similar credit requirements and income and purchase price limits as other Access programs.
Other Illinois first-time homebuyer loans
On a national level, there are loans geared toward first-time homebuyers that Illinoisans can take advantage of. Some of the loans you can explore include:
- FHA loans: Loans insured by the Federal Housing Administration (FHA) have more lenient financial requirements than other loans. You can get an FHA loan with 3.5 percent down and a credit score as low as 580.
- VA loans: For active-duty military, veterans and surviving spouses, a loan guaranteed by the U.S. Department of Veterans Affairs (VA) is a great option. These loans typically come with lower interest rates and don’t require a down payment.
- USDA loans: Loans guaranteed by the U.S. Department of Agriculture (USDA) also require no down payment, but you’ll need to buy in a designated rural area and meet area-specific requirements.
- HomeReady and Home Possible loans: HomeReady and Home Possible are loan programs created by government-sponsored enterprises Fannie Mae and Freddie Mac. They’re specifically for first-time homebuyers, requiring only 3 percent down and having more flexible income requirements.
Get started
Remember that the IHDA doesn’t offer mortgages directly; these programs are offered by IHDA-approved mortgage lenders. If you believe you qualify for a first-time homebuyer program through the state, visit the IHDA website for more information and to take next steps.
For more information on other national loan and program options, visit our first-time homebuyer loans and programs page.
