Loans for Chicago First Time Home Buyers
Many things have changed about first time home buyer loans in the past few years. With Chicago’s market no longer marked as declining by many investors, we’ve seen easier access to both FHA and conforming loans for first time home buyers. Beyond the standard big agency programs, the Illinois Housing Development Authority (IHDA) has two great programs for an Illinois first time home buyer.
The Illinois Home Start program is a great example of these options available to first time home buyers. This loan is a 30 Year Fixed at 4.75%. There is a down payment assistance option that trades a slightly higher rate for up to $6,000 in assistance. Using an FHA vs Conventional calculator and also comparing some of the state-sponsored programs can be a winning combination.
If you meet the Home Start requirements–notably the 640 FICO, income restrictions, and price restrictions, it can be a great program. The rate is fixed at a very low rate and, if the down payment assistance is critical, this is one of the few programs where you’ll still be able to get in with less than 3.5% down. The conventional loans tend to be the best option for people with over a 740 FICO and at least 5% down payment (10% on condos). The FHA loans tend to be very good when the FICO scores get lower or when the down payment needs to be slightly smaller.
It shouldn’t take more than a few extra moments to have your loan officer compare these options side by side for you. The difference can be thousands of dollars in just the first few years. In spite of all the negative news about the availability of loan programs, they’re actually better than what you would think.