Overview
Illinois's housing market offers opportunities for first-time buyers, with a median home price of approximately $260,000. The Illinois Housing Development Authority (IHDA) provides the primary state-level assistance through mortgage programs and down payment assistance for qualifying buyers.
The IHDAccess Forgivable Mortgage is an illinois housing development authority's key offering for first-time buyers, providing up to $6,000 as a forgivable second mortgage (forgiven after 10 years). This program is designed to reduce the upfront cost barrier that prevents many qualified buyers from purchasing a home. Buyers must complete a HUD-approved homebuyer education course and work with an approved lender.
State Programs
IHDAccess Forgivable Mortgage
Forgivable down payment assistanceIHDAccess Deferred Mortgage
Deferred down payment assistanceFederal Programs Available in Illinois
These nationwide programs can be combined with Illinois state assistance for maximum benefit.
FHA Loan Program
Low down payment mortgageVA Home Loan
Zero down payment mortgageUSDA Rural Development Loan
Zero down payment mortgageTips for First-Time Buyers in Illinois
The IHDAccess Deferred Mortgage extends additional support through up to $7,500 as a 0% deferred second mortgage. Illinois has a flat income tax of 4.95%. Property taxes are among the highest nationally, averaging about 2.07%. IHDA offers multiple DPA options that can significantly reduce upfront costs.
Federal programs complement state offerings in Illinois. FHA loans require just 3.5% down with flexible credit requirements. VA loans provide zero-down-payment financing for veterans and active-duty military, particularly relevant near Scott Air Force Base, Great Lakes Naval Station. USDA loans offer zero-down-payment options in eligible rural areas, which cover significant portions of Illinois.
Prospective buyers should compare all available options, as combining state and federal programs can dramatically reduce out-of-pocket costs. Working with a HUD-approved housing counselor can help navigate the application process and identify the best program combination for your situation.
Frequently Asked Questions
For educational purposes only -- not financial or tax advice. Program details, eligibility requirements, and benefit amounts are subject to change. Verify all information directly with the administering agency before applying. Last verified: March 30, 2026.