I’m an Illinois resident and looking to purchase a home within the year. As the title states, I’ve found info on the IDHA’s website about a program designed to help with down payment assistance and student loan elimination. I have about 10k in student loans left and could use the down payment assistance. Does anyone have any experience with using the IDHA’s smart buy program? If so, pros and cons?
the following info was pulled from idha.org:
Don’t let student loans stop you from buying a home. IHDA Mortgage SmartBuy can help! SmartBuy works in two ways:
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offers $5,000 in assistance that you can use toward down payment or closing costs
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provides up to $40,000 in assistance for student loan debt relief (total educational assistance cannot exceed more than 15% of the purchase price or $40,000, whichever is lower)
Borrowers may be:
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first-time or non first-time homebuyers
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live in any county statewide
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DACA Recipients (Dreamers) are eligible!
SmartBuy is designed to increase homeownership opportunities for low- to moderate-borrowers across Illinois affected by increasing student loan debt. SmartBuy will provide:
Offers:
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a safe, affordable 30-year 1st mortgage with a fixed interest rate,
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a 0% interest 2nd mortgage for $5,000 for down payment and/or closing cost assistance. This 2nd loan is deferred for the life of the first mortgage and will become due upon sale or refinance, and
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a three-year promissory note and deed restriction for 15% of the purchase price (up to $40,000) in assistance for student loan debt relief. (If the borrowers sell the property within 3 years, funds may be due, and they will need to sell to another borrower within IHDA’s income and purchase price limits.)
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FNMA loan types only
Requirements:
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Borrowers must have at least $1,000 in student loan debt
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The debt must be in the borrower’s name for the borrower’s student loans
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First-Time and Non First-Time Homebuyers are allowed
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Must have the debt from an eligible educational institution is an accredited public, nonprofit, or proprietary (privately owned profit-making) college, university, vocational school, or other postsecondary educational institution
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Pay off at least one borrower’s full remaining student loan balance at loan close – no partial payoff of any borrower’s loans is permitted.
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All Illinois counties are eligible
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Contribute $1,000 or 1 percent of the purchase price, whichever is greater
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Meet the income and purchase price limits
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Minimum credit score – 640 for all loan types
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Live in the home as primary residence
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Complete homeownership education prior to close (online and in-person options available)
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New construction is allowed
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