Purchasing a first home in Illinois in 2025 is an exciting yet challenging endeavor for down-payment assistance and mortgage pre-approvals, given the median home sale price of $285,600 as of February 2025. These various state and local programs to ease financial burdens are administered primarily by the Illinois Housing Development Authority (IHDA), these programs offer down payment assistance (DPA), grants, and affordable mortgages. The RefiGuide published this guide explores Illinois’ 2025 first-time home buyer programs, eligibility criteria, benefits, risks, and two case studies demonstrating their application.

Illinois First-Time Home Buyer Programs

IL home buyer

Illinois offers a range of home financing programs through IHDA and local governments to support IL first-time home buyers.

These include IL home buyer grants, forgivable loans, deferred loans, and tax credits, often paired with 30-year fixed-rate mortgages.

Key statewide programs include:

• IHDAccess Forgivable: Provides up to $6,000 (4% of the purchase price) as a forgivable loan for down payment and closing costs, forgiven monthly over 10 years if the home remains the primary residence .
• IHDAccess Deferred: Offers up to $7,500 (5% of the purchase price) as a 0% interest, deferred loan, repayable upon sale, refinance, or first mortgage payoff.
• IHDAccess Repayable: Provides up to $10,000 (10% of the purchase price) as a 0% interest loan, repaid monthly over 10 years.
• Illinois HFA1: Delivers up to $10,000 in DPA as a 0% interest, deferred loan, available to first-time and repeat buyers.
• 1stHomeIllinois: Offers a $7,500 grant (non-repayable) for first-time buyers and veterans in select counties (e.g., Boone, Cook, Kane) .
• SmartBuy: Combines a 30-year mortgage with up to $5,000 in DPA and $40,000 for student loan relief, requiring full student loan payoff at closing.
• Opening Doors: Provides up to $6,000 in forgivable DPA, forgiven after five years, targeting underrepresented communities

Illinois State‑Wide IHDA Programs (IHDAccess Assistance)

The Illinois Housing Development Authority (IHDA) provides three bundled assistance options when paired with a primary mortgage through an IHDA-approved lender:

A. IHDAccess Forgivable Mortgage

  • 4% of the home’s purchase price (up to $6,000) as a forgivable loan, eliminated monthly over 10 years.

  • 30-year fixed-rate mortgage (FHA, VA, USDA, conventional, FNMA HFA Preferred).

  • Requires min. $1,000 or 1% cash contribution and credit score ≥ 640.

  • Forgiven if borrower stays in the home, refinances, or sells.

B. IHDAccess Deferred Mortgage

  • 5% of purchase price (up to $7,500) as an interest-free deferred loan, due upon sale, refinance, or payoff.

  • Same structure and eligibility rules as Forgivable.

C. IHDAccess Repayable Mortgage

  • 10% of purchase price (up to $10,000) interest-free, repaid over 10 years via monthly payments.

  • Same mortgage types and borrower requirements.

Official IHDA link and lender information:

  • Getting an IHDA Loan (Access options): 

Illinois HFA1 Program

  • Provides a $10,000 interest-free second mortgage, deferred for 30 years.

  • Available to first-time or repeat buyers, statewide; usable alongside other DPA programs.

  • Covers down payment and/or closing costs.

  • Requires 30-year IHDA mortgage with fixed rate.

  • Flexible usage across counties, including pairing with IHDAccess.

Opening Doors (Abriendo Puertas) Program

  • IHDA relaunch (Feb 2025) targeting underrepresented communities.

  • Offers $6,000 forgivable second mortgage over 5 years.

  • Designed to address racial and income disparity in homeownership.

  • Plugged by $8 million in Rebuild Illinois funding for ~1,300 buyers.

FHLBank Chicago Downpayment Plus® (DPP) Grants

  • Administered by FHLBank Chicago via member lending institutions.

  • Eligible households (<80% AMI) can get up to $10,000 forgivable grants at closing.

  • DPP: for individual borrowers; DPP Advantage: through nonprofits.

  • Forgiven monthly over 5 years; aligned with IHDA‌ها and Illinois mortgage lenders.

Local & City-Level Illinois Home Loan Programs

A. Chicago Housing Authority (CHA) DPA

  • CHA residents can get up to $20,000 grant; non-residents up to $10,000.

  • Used for down payment, loan reduction, or closing costs.

  • Requires 8-hour HUD-approved education, first-time buyer, Chicago residence, and permanent occupancy for 10 years

  • Forgivable after 10 years .

B. Cook County Down Payment Pilot

  • Offers DPA for down payment, closing costs, or mortgage buydown.

  • Currently paused but expected to return; may match IHDA eligibility.

C. Municipal Programs (e.g., Moline)

  • Moline’s program: up to $7,100 for 80% AMI buyers; requires $1,000 borrower contribution moline.il.us.

Federal & FHA Support

  • FHA, VA, USDA, Fannie Mae, and Freddie Mac provide low-down or no-down options that can supplement IL programs

  • IL First-time home buyers can withdraw up to $10,000 penalty-free from IRAs for home purchase.

  • These tools help fit cash constraints into funding strategies for first time home buyer loans.

State Legislation on First-Time Buyer Tax Savings

  • Illinois Senate Bill 148: allows homebuyer savings deductions up to $5,000 individual, $10,000 joint per year; accumulates up to $25,000/$50,000 myjournalcourier.com.

  • Helps in saving for closing costs/down payment and tax reduction.

Illinois First Time Home Buyer Program Comparison Table

Program Max Assistance Type Forgiveness/Terms Eligibility Notes
IHDAccess Forgivable $6,000 Forgivable loan Over 10 years Score ≥ 640, 1% cash, income limits Primary residence
IHDAccess Deferred $7,500 Deferred loan Due on sale/refinance Same criteria
IHDAccess Repayable $10,000 10-yr monthly loan Interest-free Same criteria Monthly repayment required
Illinois HFA1 $10,000 Deferred 2nd mortgage Due in 30 years Statewide, pairing with IHDA loan Flexible stacking
Opening Doors $6,000 Forgivable loan Over 5 years Underrepresented communities Funded via Rebuild Illinois
FHLBank Downpayment Plus® $10,000 Forgivable grant Over 5 years ≤80% AMI, via member lenders Closed at closing
CHA DPA $10k–$20k Grant Forgivable after 10 years First-time, Chicago residents Education required, residence rule
Cook County DPA Varies Loan/grant TBD County residents Program often paused
Municipal (e.g., Moline) $7,100 DPA + closing costs Borrower $1,000 min 80% AMI
IRA First-Time Withdrawal $10,000 Federal withdrawal Penalty-free No home within last 2 yrs Federal tax applies to traditional IRAs
State Tax-Deductible Accounts $5k–$10k/year Savings plan Reduces AGI First-time, 10-yr limit Pending Senate bill

Case Study 1: Carlos & Maria – Chicago (CHA Residents)

Profile:

  • Carlos (35) & Maria (33), CHA residents, first-time buyers, combined income: 70% AMI.

  • Credit scores: 650 (Carlos), 640 (Maria).

  • Home price: $240,000 in South Chicago.

Funding Stack:

  1. IHDAccess Deferred: $7,500

  2. Illinois HFA1: $10,000

  3. Opening Doors: $6,000 (shared household, eligible)

  4. CHA DPA: $20,000 grant

  5. Primary mortgage (FHA, 3.5% down)

Outcome:

  • Total assistance: $43,500, reducing personal cash to $8,000 (3.5% FHA down), plus waiver of mortgage insurance.

  • Monthly IHDAcess repayments deferred; CHA grant forgivable after 10 years.

  • Result: attainable monthly payments (<$1,600 incl. taxes), equity building, local stability.

Links:

Case Study 2: Sarah – Suburban Cook County

Profile:

  • Sarah (28), single-income teacher earning 65% AMI.

  • Credit score: 680.

  • Buying a $180,000 starter home in Cook County (outside Chicago city limits).

Funding Stack:

  1. IHDAccess Repayable: $10,000 (monthly loan)

  2. Illinois HFA1: $10,000

  3. FHLBank DPP: $10,000 via local credit union

  4. FHA Mortgage (3.5% down)

Outcome:

  • Combined DPA: $30,000, lowering personal cost to $6,300 + reserves.

  • IHDAcess repaid over 10 years (~$80/mo); FHLBank grants forgivable.

  • Mortgage balance ~$147,700; monthly total ~$1,250 (PITI).

  • After 5 years of stability, qualifies for state’s tax-deductible savings program (if passed).

Links:

10. How to Maximize These Programs

1. Secure Mortgage Eligibility

2. Attend HUD‑Certified Education

  • Mandatory for IHDA & CHA programs.

3. Choose and Stack Carefully

  • Align forgivable/repayable loans with personal plans.

  • e.g., stay 5–10 yrs to reap forgivable benefits.

4. Use Partner Lenders

  • IHDA, FHLBank, and CHA require affiliated lenders.

5. Timing is Key

  • Funds like FHLBank DPP are first-come; monitor Cook County restarts.

6. Monitor Policy Changes

  • SB 148 passes → new savings vehicle within months .

11. Checklist: What to Prepare

  • ✔️ Credit score ≥ 640

  • ✔️ DTI ≤ 50%

  • ✔️ Income verification & county pricing

  • ✔️ Down payment savings or access to HFA1

  • ✔️ Completion of HUD-approved education

  • ✔️ Finding IHDA-approved lender

  • ✔️ CHA tenant-of-record (if in Chicago)

  • ✔️ Timely applications for IHDAcess, HFA1, Opening Doors, and DPP

12. Top Official Program Links

Final Thoughts

Illinois offers one of the most robust landscapes for first-time homebuyer support in 2025—from IHDA’s tiered DPA programs to grant-based assistance via FHLBank Chicago, CHA, and local governments. Well-coordinated stacking (as seen in our case studies) can reduce or eliminate upfront costs and create manageable monthly payments.

Take action by:

  • Verifying eligibility metrics (credit, DTI, income)

  • Completing HUD education

  • Aligning with approved lenders

  • Timing applications based on funding availability

With strategic use of forgivable and deferred loans, constant tracking of state legislation, and opportunistic leveraging of grants, Illinois homeownership is realistically attainable—even in today’s competitive market.

Let me know if you’d like help with lender introductions, education course details, or program comparisons tailored to your region or situation.

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