First Home Purchase? These 3 Programs Will Help
If you’re buying a home for the first time in Illinois, these three loan programs will help.
Buying a home for the first time is exciting, but many first-time buyers are concerned about affordability. Luckily, there are three home loan programs designed to help you out:
1. FHA loan. The FHA program is a loan backed by the government that allows investors to accept terms that they otherwise wouldn’t. For first-time homebuyers, monthly payments with the FHA loan will be a bit lower than they might have been with a typical conventional loan, and they’re easier to get, as well.
2. IHDA loan. If you’re buying a home in Illinois, the Illinois Housing Development Authority (IHDA) loan will grant you up to $7,500. The IHDA funds are established each year, so they can run out as the year progresses, but if you’re buying early in the year, you should be in good shape. If you’re buying later in the year, talk to a lender to find out if those funds are still available to you. The IHDA loan isn’t actually a grant, but this loan forgives a certain amount every year up to the 10-year loan term. If you stay the full 10 years, the entire balance is forgiven, but even if you don’t, you still won’t have to pay off the full balance.
For first-time homebuyers, monthly payments with the FHA loan will be a bit lower.
3. Seller credit. Seller credit is when you have the seller pay your closing costs. The advantage here is that you don’t have to go through any extra paperwork or counseling that IHDA or other programs might put you through. Seller credit doesn’t amount to cash in your pocket, but it does mean you’ll have less to pay at closing. The nice thing about this option is that it can be whatever you work out with the seller, so long as it fits within the constraints of the lender requirements.
If you have any questions about being a first-time homebuyer, don’t hesitate to reach out to me. There are many programs available to help you, and I’d love to tell you more about them.