We know that buying a home can be intimidating, especially if it’s your first time. The process is scary and deadlines are stressful.
Everyone feels overwhelmed by the financial commitment because it’s a lot of money to spend on one thing.
The good news is, Chicago offers unique programs specifically designed to help homebuyers with the financial burden of purchasing a property. These programs can provide significant savings on down payments, closing costs, and even ongoing payments.
And because most buyers aren’t aware of them, these resources are often underutilized.
But don’t worry, the Ben Lalez Team has your back! We’ve helped over a thousand families move homes over the last decade, so we’re very passionate about real estate in Chicago.
In this guide, we’re going to show you the top programs available, how to qualify, and the potential savings you’ll enjoy in the home-buying process.
Let’s dive into the most beneficial programs out there.
City Of Chicago Home Buyer Assistance Program
“Get Up to 7% of Your Loan for Down Payments and Closing Costs”
This program helps homebuyers by providing grants for down payments and closing costs. Eligible buyers can receive up to 7% of the loan amount, and can be used to purchase single family homes, townhomes, condos, and even small multi-unit properties.
Eligibility: Must be a Chicago resident; income limits apply depending on loan type; complete a homebuyer education course.
Property Types: Single-family homes, townhomes, condos, small multi-unit properties.
Application Steps
- Contact an approved lender.
- Complete a homebuyer education course.
- Gather income documentation and apply through the lender.
Program Link: https://www.chicago.gov/content/dam/city/depts/mayor/general/HomeBuyerAssistanceProgramFlyer.pdf
Illinois Housing Development Authority (IDHA) Programs
“Forgivable Loans and Debt Reduction for Illinois Homebuyers”
IDHA offers a statewide program that provides assistance through forgivable and deferred loans that can reduce or eliminate portions of a homebuyer’s debt after certain periods.
Eligibility: Varies by loan type but includes income limits, credit requirements, and homebuyer education.
Program Highlights: Forgivable and deferred loans for down payments or closing costs, plus debt reduction for buyers with student loans.
Application Steps
- Start with the IHDA website to find participating lenders.
- Complete the required education and check for credit qualifications.
- Submit application and documentation through an approved lender.
Program Link: https://www.ihda.org/lenders-realtors/lending-programs/
Chicago Housing Authority Down Payment Assistance Program
“Grants of Up to $20,000 for CHA Residents and $10,000 for Non-Residents”
This program provides grants to Chicago homebuyers of up to $20,000 for CHA residents/participants and $10,000 for non-CHA applicants. These funds can be used for down payments, loan reduction, or closing costs.
Eligibility: Available to CHA residents and non-CHA buyers with income limits up to 120% AMI. Requires a HUD-approved homebuyer course.
Grant Amounts: $20,000 for CHA residents, $10,000 for non-CHA buyers.
Application Steps
- For CHA residents, contact CHA for application guidance.
- Complete HUD-approved homebuyer education and gather necessary documents.
- Non-CHA buyers can find details on the CHA website and follow similar steps.
Program Link: https://nhschicago.org/cha-down-payment-assistance/
Cook County Down Payment Assistance Pilot Program
“New $25,000 Assistance Pilot for Cook County Homebuyers”
Launched in June 2024, this pilot program provides homebuyers across Cook County with up to $25,000 (or 5% of the purchase price) to assist with down payments, closing costs, or mortgage buydowns.
Eligibility: First-time buyers with income up to 120% of median, or unrestricted for Disproportionately Impacted Areas.
Course Requirement: 8-hour education course before closing.
Application Steps
- Apply through Club 720 for education and application support.
- Complete required education course and provide income documentation.
- Follow up for grant confirmation upon home purchase.
Program Link: https://www.club720.org/cookcounty-dpa
Building Neighborhoods and Affordable Homes (BNAH) Program
“Forgivable Grants Up to $100,000 for New Homes in Select Chicago Neighborhoods”
This program provides forgivable grants of up to $100,000 for eligible buyers buying newly constructed single-family homes in specific neighborhoods in Chicago. These funds can be used for down payments, closing costs, and more.
Eligibility: Household income up to 140% of AMI, with a 10-year owner-occupancy commitment.
Grant Details: Up to $100,000 for purchasing in specific Chicago neighborhoods.
Application Steps
- Apply through Chicago’s Department of Housing with proof of income and residency.
- Complete purchase within a specified redevelopment area.
- Sign a 10-year owner-occupancy agreement upon closing.
Program Link: https://www.chicago.gov/city/en/depts/doh/provdrs/homebuyers/svcs/building-neighborhoods-and-affordable-homes-program.html
Tax Increment Finance Purchase Rehab (TIFPR) Program
“Forgivable Loans for Buying and Rehabilitating Properties in Chicago’s TIF Districts”
This is a City Of Chicago initiative that provides forgivable loans for buyers looking to purchase and rehabilitate vacant 1-4 unit residential properties in Chicago’s TIF districts. The program can cover up to 25% of the project cost, including the purchase price, rehab expenses, and closing costs.
Eligibility: Must buy and rehabilitate a vacant property in a TIF district; income requirements and rehab workshops required.
Coverage: Up to 25% of the project cost, including purchase and rehab.
Application Steps
- Confirm property location in a TIF district.
- Complete the application on NHS Chicago’s site and enroll in rehab workshops.
- Provide purchase and rehab budget documentation, plus verification of TIF eligibility.
Program Link: https://nhschicago.org/tifpr/
Tips For Maximizing Success
We know it’s a lot of information, but take some time to dig through the programs to see if you qualify. Consider applying for multiple programs if you’re eligible.
Since many programs require homebuyer education, remember to register for these courses early to avoid delays. Completing this step in advance can speed up the application process.
Some programs, especially the pilot ones like the Cook County Down Payment Assistance program, have limited funding or annual budget resets. You can subscribe to updates from the program providers to make sure you don’t miss any important deadlines.
And of course, you can reach out to the Ben Lalez Team! We can help you identify any programs that you may be eligible to participate in!
Frequently Asked Questions
- Can I apply for more than one program at a time?
Yes, but it’s important to check with each program for compatibility. Some programs can be combined, while others may restrict additional support. - What happens if I sell my home early?
Many of these programs require owner-occupancy for a set period of time. Selling early might mean repaying part of the money back, so check each program’s terms. - Do I need a perfect credit score?
This will vary depending on the program, but many will prioritize first-time homebuyers and offer options for those with lower credit scores.
