When you want to buy a home, one of the biggest challenges for people is saving up all the money you need for the down payment & closing costs. Because of this, a lot of potential buyers always ask me about what first time home buyer programs are available. Fortunately, if you can meet the requirements, there are some home buyer programs out there that can help with your down payment. For some, you don’t even need to be a first time home buyer!
Below are some of the national home buyer programs that are available, as well as some programs that are specific to counties in IL!
FHA Loans
The most popular first time home buyer program is the FHA loan. The FHA loan allows people to buy homes with only a 3.5% down payment. On top of that, FHA has easier credit & income requirements than regular (conventional) loans. For example, you only need a 580 credit score to qualify for FHA, compared to at least a 620 for conventional! FHA makes home buying an option for people who otherwise would not qualify for a home.
Other requirements for FHA loans include that the home has to be in move in ready condition, and that the home cannot have any safety hazards.
VA loans
For the veterans out there in the military, The VA, which stands for veteran affairs, offers a 0% down payment loan! Like FHA loans, VA loans require the home to be in move in ready condition.
Visit https://www.benefits.va.gov/homeloans/ for more info.
USDA loans
For those who live in Rural areas, The US Department of Agriculture (USDA) also has a loan program that offer up to 100% financing, meaning you won’t need a down payment. You don’t necessarily need to buy a farm either, it just has to be in an area that qualified by the USDA (more rural areas). You will typically need a credit score of 640 or more to qualify, but there is still a chance to qualify even if you don’t. Visit USDA.com for more info!
Here are some down payment programs available in the Chicagoland area & surrounding suburbs.
Down Payment Plus Program FHL Bank Chicago
The down payment plus program, offered through the Federal Home Loan Bank of Chicago, provides down payment assistance grant equal to 3 times what the buyer contributes to the down payment, up to $6000 maximum. For example, if you put down 1000, this program will contribute 3000 toward your down payments. Also, since this is a grant, you do not have to pay it back!
To qualify, you have to use a lender that is a member Federal Home Loan Bank of Chicago financial institution. You also have to take some homebuyer education & counseling classes. You then have to contribute a minimum of $1000 of your own money towards the closing costs. There are also some requirements for your income. Visit https://www.fhlbc.com/community-investment/downpayment-plus-programs for more info.
Home Buyer assistance Romeoville
If you are looking to move to the village of Romeoville, the village is offering what they call the Assist homeownership program. They are offering a cash grant of between 3-7% of the purchase price. To qualify, you have to have a minimum of a 640 credit score for FHA loans or a 660 score for conventional loans.
To qualify, you can not have owned a home within the last 3 years, the home must be your primary residence, and there are also certain income requirements.
Visit http://www.romeoville.org/214/Homebuyer-Assistance for more info on this program.
*I just found out that this program is actually available in other suburbs, such as Aurora, Naperville, Schaumburg, and Joliet to name a few!
Kane County First Time Home Buyer Program
If you are looking to buy a home in Kane County, Kane county offers a first time home buyer deferred loan program. This is a 0% interest loan, and no money is due until the home is sold. This program will give up to $10,000 in down payment assistance.
Eligible homebuyers must currently live or work in Kane county for at least one year. complete HUD-certified Homebuyer Counseling, and have a down payment of at least 1% of the purchase price of the home they wish to purchase.
Visit https://www.countyofkane.org/Pages/ocr/firstTimeHomebuyer.aspx for more info.
Community Connections Home Buyers Assistance Program (Chicago)
For those in Chicago, the community connections home buyers assistance program offers loan programs for up to $30,000 for Chicago first responders and other eligible careers with the City of Chicago. These funds are meant to help city of Chicago workers buy homes.
To be eligible, the home has to be in certain approved neighborhoods, you must live in the property for 10 years, and you have to meet certain income requirements.
Visit https://www.chicago.gov/city/en/depts/doh/provdrs/homebuyers/svcs/community-connections-home-buyer-assistance-program.html for more info.
IHDA Grant
The biggest program in the state of Illinois comes form the Illinois Housing Development Authority, or IHDA. They have a few programs that they offer in order to help first time home buyers with down payment and closing costs. Below are the programs that IHDA offers
Open Door Program
The open door program will provide a 30 year loan at a competitive interest rate, as well as offer up to $6000 in down payment assistance in a forgivable loan. To be eligible for this program, you have to meet the income requirements, you must live in the property, and you must have at least a 640 credit score, and you have to complete a home buyers education course.
Smart Buy Program
The smart buy program is designed for those who have student debt. This program offers up to 5,000 in down payment assistance, and will pay off up to $40,000 of your student debt relief!
It has the same eligibility as the open door program, plus you have to have at least $1000 in student debt, and the loan must be a fannie mae loan (no FHA loans).
IHDA access programs
There are 3 programs with the IHDA access programs: the forgivable, the deferred, and the repayable grant. The forgivable loan will provide up to $6000, which you do not have to pay back. The deferred will provide up to $7500, which you do not have to repay until you sell your home. The repayable will provide up to $10000, which is an interest free loan paid back monthly over a 10 year period.
The requirements are the same as the open door program.
Visit https://www.ihda.org/lenders-realtors/lending-programs/ for more info on these programs.
As always, feel free to reach out to me at Baileyacresproperties.com. Thanks and have a great day!