Buying a home

Do you want to buy a home but are worried that you do not have enough saved for the down payment? You’re in luck! If you are an Illinois resident, you may qualify for the myriad of down payment assistance programs offered through the State and local municipalities.

The Illinois Housing Development Authority, IHDA for short, offers down payment assistance in various tiers. The amounts range from $6,000 to $10,000. There are different repayment requirements for each amount listed. For example, the $6,000 down payment assistance amount is 4% of the home purchase price for a maximum of $6,000. You do not have to pay this back as it will be forgiven over a 10 year span as long as you remain in your home.[1] The $10,000 in down payment assistance covers 10% of the purchase for a maximum of $10,000. This assistance is paid back monthly over ten years at a 0% interest rate. IHDA has a list of participating lenders on their website.

The Federal Home Loan Bank of Chicago has two programs, Downpayment Plus & Downpayment Plus Advantage, that also offer down payment assistance. Downpayment Plus is a matching program that provides down payment and closing cost assistance for income-eligible homebuyers. The assistance is provided in the form of a forgivable grant paid on behalf of the borrower at the time the borrower closes on mortgage financing with a participating FHLBank Chicago member financial institution. Grants are forgiven on a monthly basis over a five-year retention period. Downpayment Plus Advantage is a similar program but assists income-eligible homebuyers participating in homeownership programs offered by nonprofit organizations that provide mortgage financing directly to the homebuyer; it is not a matching program. Nonprofit organizations providing direct first-mortgage financing, such as Habitat for Humanity or Neighborhood Housing Services, must partner with an FHLBank Chicago member financial institution to access DPP Advantage funds. Grants are forgiven on a monthly basis over a five-year retention period.[2] The maximum grant amount for both programs is $6,000.

Local organizations and counties also offer their own down payment assistance programs. The MMRP Purchase Assistance Grant provides up to $15,000 in down payment assistance for the purchase of a home in one of the City of Chicago’s 10 Micro Market Recovery Program (MMRP) Areas. This grant is available to low and moderate-income households earning up to 120% of the Area Median Income (AMI) for the Chicago Metropolitan Area.[3] It does require that you be a first-time homebuyer or not have owned a home in the previous 3 years.  More information can be obtained by contacting Neighborhood Housing Services of Chicago.

Community Partners for Affordable Housing, CPAH, provides eligible Lake County, Illinois homebuyers with up to 5% of the purchase price to help with down payment and closing costs. Assistance is provided in the form of a 0%-interest deferred loan with no monthly payments, forgiven at a rate of 1/60th every month. Loan forgiveness begins 60 days after closing. The loan is fully forgiven after 5 years and 60 days in the home. Other eligibility factors require that you put down $1,000 or 1% of the purchase price, whichever is greater, and that you qualify for financing with a CPAH Participating Lender.[4]

Kane County, Illinois offers a First-Time Homebuyer Loan Program that provides up to $10,000 in down payment and/or closing-cost assistance to first-time homebuyers in the form of a zero-interest, deferred-payment loan.  No interest accrues on the loan, and no payments are due until the home is sold, the title is transferred, or the home is no longer used as the homebuyer's principal residence. Up to an additional $10,000 may be available if the home purchased is located within the city limits of St. Charles, under these same terms and conditions.[5] A nice perk with this program is that Kane County does not require First Mortgage Lenders to be pre-qualified. Homebuyers may work with a Lender of their choice to obtain their first mortgage.

There are down payment assistance opportunities in other counties and cities throughout Illinois from Madison County down south to Rockford up north. Madison County Community Development offers a 5-year forgivable loan, based on 80% of area median income or less, for closing costs and down payment. This loan, for up to $5,000, will be forgiven only after five full years’ occupancy. Homebuyers who receive funds must obtain one-on-one pre-purchase counseling from a HUD-certified agency. A list of agencies may be obtained from a participating lender.[6] The city of Rockford offers a Homebuyer Assistance Program that provides financial assistance to make the purchase of a home more affordable to income-eligible homebuyers. The city of Rockford determines the amount of financial assistance, up to a maximum of $14,999, based on the applicant’s income, debt, and anticipated mortgage. The homebuyer must live in the home from the time of purchase through the end of the forgivable loan; approximately 6 years.[7]

You may be wondering why there are so many down payment assistance programs available to homebuyers. The Community Reinvestment Act (CRA) of 1977 required federally regulated banks to make an effort to lend to low and moderate income clients in their service area.  As a result, most of the larger federally regulated banks and mortgage lenders in our country have created CRA home loan programs.[8] Some of the programs mentioned above are the result of this initiative.





[1] “IHDA Mortgage Program Directory.”, Illinois Housing Development Authority,

[2] “Downpayment Plus Programs: FHLBank Chicago.” FHLBC.COM, Federal Home Loan Bank of Chicago,

[3].” NHS Chicago, Neighborhood Housing Services of Chicago,

[4] “Down Payment Assistance.” CPAH Down Payment Assistance, Community Partners for Affordable Housing,

[5] “Pages   - First-Time Homebuyer Program.” Kane County - Established January 16, 1836, Kane County Office of Community Reinvestment,

[6]Madison County HOMEbuyer Program, Madison County Community Development,

[7]Homebuyer Assistance Program, City of Rockford Community & Economic Development Department,

[8] “First-Time Home Buyer Loans - Conventional, CRA, FHA, HUD, USDA, State Bond and VA Loans.” CRA Home Loan Programs, First Home Advisor, 12 Mar. 2019,


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