Illinois Down Payment Assistance Programs

Illinois Down Payment Assistance Programs

If you are interested in purchasing a home in Illinois, but need down payment assistance there are options. To get Illinois down payment assistance program, you may want to check out the Illinois Housing Development Authority.

Organizations that may have information on down payment assistance available to home buyers include the Illinois League of Financial Institutions, the State of Illinois, and the Illinois Association of REALTORS just to name a few. Although there are quite a few organizations that can provide down payment assistance, funding is sometimes limited and is often offered on a first-come, first-served basis. But don’t that let hinder you in your search for assistance. It will be well worth your time and effort to apply for the assistance programs that are available.

When searching for down payment assistance, it is recommended that you know your particular home buying needs, know what makes your situation unique, and that you understand your financial situation. Your personal financial situation will determine which assistance programs will be most beneficial to your unique home-buying and your unique financial needs.

In addition, you will save time by avoiding assistance programs for which you would not qualify. Often first-time home buyers have the best choices of down payment assistance, but they are not the only group for which assistance is available. Purchasing a home helps everyone from the home owner, the home builder, to the local economy, so providing financial assistance is a wise investment. If your dream is to own your own home, but you are hesitant because you are not sure that you can cover the down payment, there are Illinois down payment assistance programs if you are willing to look.

Below is a list of Illinois Down Payment Assistance Programs:

No Down Payment Mortgages – mortgages that require no down payment

USDA Rural Loan – the purpose of the Single Family Housing Direct Home Loan is to assist low- and very-low-income applicants obtain decent, safe and sanitary housing in eligible rural areas by providing payment assistance to increase an applicant’s repayment ability. There is no down payment. Payment assistance is a type of subsidy that reduces the mortgage payment for a short time. The amount of assistance is determined by the adjusted family income.

VA Home Loan – VA helps Service members, Veterans, and eligible surviving spouses become homeowners. As part of our mission to serve you, we provide a home loan guaranty benefit and other housing-related programs to help you buy, build, repair, retain, or adapt a home for your own personal occupancy. There is no down payment as long as the sales price doesn’t exceed the appraised value.

 

Low Down Payment Mortgages – mortgages that require up to 3.5% down payment

FHA Mortgage Loan – the purpose of the FHA Home Mortgage Loan is to provide mortgage insurance for a person to purchase or refinance a principal residence. The mortgage loan is funded by a lending institution, such as a mortgage company, bank, savings and loan association and the mortgage is insured by HUD. A down payment of just 3.5 percent is required and may consist entirely from “gift funds.” The credit score requirement is 580.

Home Possible® Advantage Mortgage – the purpose of the Home Possible® Advantage mortgage by Freddie Mac is to offer low down payments for low- to moderate-income homebuyers or buyers in high-cost or underserved communities. Down Payment can come from a variety of sources, including friends and family, employer-assistance programs and secondary financing.

The HomeReady™ Mortgage – the purpose of the HomeReady™ mortgage by Fannie Mae is to provide flexibility for applicants buy home with down payments as low as 3%, below market mortgage rates, co-borrower flexibility, additional income sources and reduced mortgage insurance costs.

Illinois Down Payment Assistance Programs

HOME Homebuyer Assistance Program This Illinois down payment program offers assistance (up to $10,000 for Illinois down payment, and $2,000 in closing costs on the purchase of a first home), or combined purchase and rehabilitation assistance (a maximum of $40,000 in total costs). The acquisition assistance program offers help via a deferred, forgivable loan at 0 percent interest. The combined purchase and rehabilitation assistance program offers funding through a forgivable loan. To be eligible, home buyers must have incomes at or below 80 percent of the area’s median income, and they must occupy the home as their principal residence. Home buyers must contribute $1,000 to the purchase and must attend first time home buyer counseling.

Home Program The @HomeIllinois mortgage program for first time home buyers. This is a 30 year, fixed rate mortgage that requires Illinois borrowers to pay 1 percent or $1,000 of the purchase price, whichever is greater. Buyers must meet income and purchase price limits, and must have a credit score of at least 640. They must live in the home as a primary residence and must complete a housing counseling program that is offered in both online and in person options. The program also offers other types of help to buyers, including: $5,000 in Illinois down payment or closing cost assistance (payment terms are 0 percent for 10 years, and Illinois borrowers who meet certain income limits do not have to pay back the loan), a federal tax credit certificate, lender paid mortgage insurance, a choice of loan type that includes FHA, VA, USDA or conventional.


HUD Programs

The US Department of Housing and Urban Development (HUD) offers the following programs:

Good Neighbor Next Door Program

The Good Neighbor Next Door Program was created by U.S. Department of Housing and Urban Development (HUD) to help law enforcement officers, pre-Kindergarten through 12th grade teachers, firefighters and emergency medical technicians buy homes. The biggest benefit of the Good Neighbor Next Door Program is the 50% discount of the home’s list price. The only catch is that the home owner must commit to live in the property for 36 months as their sole residence.

To learn more about the Good Neighbor Next Door Program, click here.

Section 184 Loan – The Indian Home Loan Guarantee Program

The Section 184 Indian Home Loan Guarantee Program is a mortgage for American Indian and Alaska Native families, Alaska villages, tribes, or tribally designated housing entities. In 1992 Congress created this program to help Native American Communities with homeownership.

Section 184 loans helps borrowers buy homes with a low down payment and flexible underwriting. Moreover, the loan does not need to be used only on properties on native lands. Purchase of an existing home for single-family residences. Also allowed are new construction, rehabilitation, and refinance.

To learn more about Section 184, click here.

Illinois Housing Agencies

Illinois housing agencies are your best resource for down payment assistance programs. Through funding from HUD, the purpose of these agencies is to ensure that affordable housing is available for everyone.

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