In this blog, we will cover and discuss IHDA mortgage guidelines on Illinois home purchases. The Illinois Housing Development Authority (IHDA), commonly referred to as IHDA, is a down payment assistance mortgage program for homebuyers in Illinois. IHDA mortgage guidelines make homeownership possible for homebuyers in Illinois by covering the down payment and closing costs for homebuyers who do not have the necessary funds to purchase a home.
Illinois Housing Development Authority loans is a very popular down payment assistance grant home loan program. This program is for Illinois homebuyers. There are a down payment assistance and grant loan program for homebuyers.
“IHDA” could stand for “Illinois Housing Development Authority,” a government agency in Illinois, United States, that provides various housing-related programs and services, including mortgage assistance programs for first-time homebuyers and low- to moderate-income individuals or families. The IHDA mortgage programs typically offer below-market interest rates, down payment assistance, and other incentives to help individuals and families achieve homeownership. In the following paragraphs, we will cover IHDA mortgage guidelines as well as other down payment assistance programs for homebuyers in Illinois.
IHDA Mortgage Guidelines on DPA That Does Not Require Repayment
There are several types of down payment assistance programs for homebuyers in Illinois. IHDA mortgage guidelines are down payment assistance programs for only Illinois homebuyers. There are forgiveable and non-forgivable down payment assistance mortgage programs for homebuyers.
The Illinois down payment assistance home loan program does not require repayment. Repayment guidelines varies with the Illinois home purchase grant program.
The Illinois Reach and Purchase Power grant program allows lower credit scores than the IHDA Grant Loan Program. This DPA program was created and launched to promote first-time homebuyers to realize their dream of home ownership becomes a reality.
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Down Payment Assistance For Homebuyers in Illinois
Many hard-working Illinois families can afford a monthly mortgage payment but lack the down payment on a home purchase. Gustan Cho Associates can help first-time homebuyers who lack down payment and guide them in realizing their dream of home ownership becomes a reality. Gustan Cho Associates has helped countless families become homeowners over the years. Gustan Cho Associates has dozens of down payment assistance mortgage programs besides IHDA mortgage loans.
IHDA Mortgage Guidelines For First-Time Homebuyers
Many homebuyers are not familiar with the IHDA Mortgage Guidelines for first-time homeowners. Is IHDA money-free money? Is it a loan? Does it need to be paid back to the state of Illinois or lender? The answer to these questions is dependent on IHDA Mortgage Guidelines on the loan program:
There is the $7,500 grant loan program. The 1stHomeIllinois is a forgivable home loan program that does not require repayment if the homeowner were to live in the property for at least 5 years
In the event a homeowner sells their home in the first 5 years of occupancy, a percentage of the grant is required to be repaid to IHDA. The $6,000 Access Forgivable Grant Program does not require repayment if the homeowner lives in their property for at least 10 years.
How Does the Illinois Housing Development Authority Home Loan DPA Program Work?
The IHDA (Illinois Downpayment Assistance Program) is offered by the Illinois Housing Development Authority to help first-time and repeat homebuyers in Illinois with down payment and closing cost assistance. Here are some key details about the IHDA down payment assistance program:
IHDA Mortgage Guidelines on Eligibility Requirements
Must be a first-time homebuyer or have not owned a home in the last three years (some exceptions apply). Must meet income and purchase price limits based on household size and geographic area. Must complete a homebuyer education course. Property must be a 1-2 unit primary residence in Illinois
How Much is IHDA Mortgage Assistance For Homebuyers?
Provides a 30-year, fixed-rate second mortgage loan for up to $7,500 (subject to income limits). The loan can be used for down payment and closing costs. No monthly payments are required on the second mortgage. The loan is forgiven at 1/60th per month after five years of living in the home
IHDA Mortgage Guidelines on First Mortgage
Borrowers must qualify for and obtain a 30-year fixed-rate IHDA first mortgage loan. Private mortgage insurance is required for down payments of less than 20%. IHDA first mortgages have income limits that vary by county/property type.
Illinois Housing Development Authority (IHDA) Mortgage Guidelines on Income Limits
Income limits are based on area median income and household size. For example, in 2024, a family of 3 in Cook County has a $109,200 income cap
IHDA Mortgage Guidelines on Home Purchase Price Limits
IHDA mortgage guidelines on home purchase price limits vary by county. For example, $492,257 for a single family in Cook County in 2024. The IHDA program aims to make homeownership more affordable for low- to moderate-income households in Illinois by providing down payment and/or closing cost assistance as a forgivable second mortgage.
What Happens If Homeowners Sell The Property In The First Ten Years?
In the event homeowners sell their property in the first ten years of occupancy, a percentage of the grant needs to be repaid to IHDA. With the $7,500 grant from the Access Deferred IHDA mortgage loan program, the grant needs to be paid back when the first mortgage matures. Or it needs to be paid back to IHDA when the property sells and/or property owner refinances. For the $10,000 IHDA Access Repayment, homeowners need to repay the grant over the course of 10 years. The $5,000 Illinois grant needs to be repaid back to IHDA with the following terms: $46.67 a month for 10 years. Click here to apply for mortgage loans with low Credit scores
IHDA Mortgage Guidelines For Borrowers
Not everyone can qualify for IHDA down payment assistance loans. IHDA requires borrowers to have at least 640 credit scores. Need an approve/eligible per automated underwriting system. Lenders need to be an IHDA Approved Lender. Suppose you’re interested in an IHDA mortgage. In that case, you should visit the official website of the Illinois Housing Development Authority or contact them directly for more information on their available programs, eligibility criteria, and application process.
Commonly Asked Questions on the IL Mortgage Program by IHDA Guidelines for Home Buyers In Illinois
What Does the Illinois Housing Development Authority (IHDA) Mortgage Program Mean?
First-time and repeat buyers in Illinois can receive help with affordable options through the IHDA mortgage program. In addition to competitive interest rates, it offers flexible eligibility requirements, down payment, and closing cost assistance.
Who Can Get an IHDA Mortgage?
To qualify for an IHDA mortgage, you will have to satisfy the following requirements –
Requirements For an IHDA Are
First-time homeowners – exceptions for repeat buyers from targeted areas can be made.
Illinois Resident
Income and household size-based purchase price restrictions for certain locations.
Credit Score of at least 640.
Suffice the DTI criteria the lender puts in place.
What Assistance Programs Does IHDA Offer?
IHDA offers several assistance programs, including:
- Down Payment Assistance (DPA): Loans of up to $10,000 that could be forgivable or repayable.
- Closing Cost Assistance: Funds to assist in covering closing fees.
- Loan Types: FHA, VA, USDA, and conventional loans are applicable.
What Are the Popular IHDA Mortgage Programs?
There are several programs offered by IHDA that can cater to diverse needs:
- SmartBuy is a program that includes assistance with student loan repayments of up to $40,000 or 15% of the home price.
- Access Forgivable: assistance of up to $6,00 is provided, which is loss forgiven after 10 years.
- Access Deferred: Different types of assistance are provided.
- For example, with the purchase of a home.
- Up to $7,500 is repayable at later times once the home is sold or if they refinance a deeper loan.
- Access Repayable: Assistance of up to $10,000 can be availed with ten years for repayment and loss done at 0 percent interest.
What Types of Properties are Eligible Under IHDA Mortgages?
- Eligible properties include single-family homes and multi-family housing (Condos).
- As long as the program requirements are set, single-family townhomes.
- Two —to four-unit housing as long as one unit is owner-occupied.
Do I Have to be a First-Time Home Buyer to be Eligible for IHDA?
Not always. IHDA programs apply to new and previous buyers buying in specified regions or programs.
What Are the Credit Scores Needed to Qualify for IHDA Loans?
- Creditworthiness differs depending on the loan:
- The FAFSA score for an FHA, VA, or USDA loan is 640.
- For conventional loans, it is 680.
How Does IHDA Determine Income Limits?
Income restrictions are determined by Set household size. The county or locality of the home that is being purchased. And the loan program for which you’re applying. For example, a one- to two-person household in Cook County has a higher income limit than rural counties.
How Much Down Payment Assistance Can I Get?
The amount is subject to the IHDA program:
- Up to $10,000 for Access Repayable.
- Up to $7,500 for Access Deferred.
- Up to $6,000 for Access Forgivable.
What Are the Steps to Apply for an IHDA Mortgage?
Navigate through these steps:
- Ascertain an IHDA-certified lender.
- They will assist you in filling out the application.
- Begin with the pre-approved stage.
- Satisfy credits, income, and property requirements.
- Undertake homebuyer education.
- The majority of IHDA programs demand this.
- Send documentation that is required.
- Include income proofs, bank statements, and tax returns.
Do You Know What the Homebuying Education Requirement Is?
Completing homeowner education, often done online or physically, is required in most IHDA programs to get Certified by HUD.
May I Use IHDA assistance With an FHA loan?
Certainly, IHDA assistance applies to FHA loans and other loans, such as USDA, VA, and even Conventional loans.
Can I Use Other Programs in Conjunction With IHDA?
Yes, you can use IHDA assistance with other grants or stimulus programs, like down payment programs, targeting certain counties or cities.
Are There Purchase Price Limits for Homes Under IHDA Programs?
The purchase price limits differ from county to county and depend on the household size. These specifics are established to make certain homes accessible to qualifying buyers.
What Are the Advantages of IHDA Programs?
- Reduced upfront costs: Coverage of the down payment and closing costs.
- Their interest rates are lower than those of other real estate loan programs, which gives them a competitive edge.
- First-time and repeat home buyers can easily take advantage of the IHDA programs.
Are IHDA Loans Forgivable?
- Certain IHDA loans, such as the Access Forgivable program, may get erased if you reside in the house for a decade.
How about selling my home before the loan forgiveness period?
Selling a property, refinancing it, or vacating a residence before the forgiveness time limit may incur the obligation to reimburse the remaining financial assistance balance. Where do you have to buy the home? Yes, the property must be in Illinois, and some programs may have different limitations because of the areas they aim for.
What is the application timeline?
The application time frame is based on your lender. However, IHDA loans generally fund within thirty to forty-five days, which is on par with ordinary mortgages.
Can I refinance an IHDA loan afterward?
Sure, but you may have to pay back any postponed, deferred, or repayable assistance that comes with refinancing the loan. For specific help, contact the local housing counselor or any lender certified by IHDA to discuss your options.
DPA: Within Reach and Power Purchase
There is no repayment required on DPA-Within Reach and Power Purchase. Minimum credit score requirement is 620 FICO. For seasoned and first-time home buyers. Gift funds are permitted. Illinois Housing Development Authority and Down Payment Assistance Programs do not have a maximum loan limit required. Seller concessions allowed up to 6% on FHA and 4% on VA loans. Manual underwriting is allowed.
One to four-unit owner occupant properties. Gustan Cho Associates are experts in assisting first time home buyers. Gustan Cho Associates is a mortgage broker licensed in 48 states with over 160 wholesale mortgage lenders.
Gustan Cho Associates, empowered by NEXA Mortgage, LLC NMLS 1660690, has dozens of wholesale mortgage lenders with no overlays on government and conforming loans. Please reach out to us at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.
