First Time Home Buyer Programs Indiana

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Information and resources for first time home buyer programs Indiana that will make buying your first home a breeze.

First-time homebuyers in Indiana may be at a loss as to how to afford the purchase of a new home because to the state’s historically high home prices and sustained high demand despite the COVID-19 pandemic.

These programs are intended to make purchasing a home more affordable by giving qualifying purchasers with down payment help or tax credits.

Indianapolis Housing Agency

In contrast to most down payment assistance programs that target low-income or first-time homeowners, Hoosier Homes permits applicants with an annual combined income of $114,240 or less to qualify.

The Hoosier Homes project would provide up to 6% of the down payment for homes in Marion County with purchase prices up to $450,000.

Christopher Walsh, deputy executive director of the Indianapolis Housing Agency, stated, “It’s one more instrument in the community’s toolbelt” to promote homeownership.

“The Indianapolis Housing Agency does not wish to be viewed as a provider of government help to extremely low-income individuals solely for rental purposes.

We want to consider how we can serve the community in a more comprehensive manner, and house ownership is a significant component of that.”

Through this program, homebuyers can receive 3% to 5% in down payment or closing cost help.

In addition, you can receive an additional 1 percent aid if you are a K-12 educator, a first-responder, a member of the U.S. military or a veteran, or if you live in Marion County and earn less than $40,800 annually.

The aid is provided in the form of a forgiven second lien with no interest for three years.

Jed Guenther, senior vice-president at Bayview Loans, whose sister firm, Lakeview Loans, is a partner in the program, stated, “Some folks simply cannot afford, especially in today’s market, the big run-up in property price increase.”

The down payment and closing costs are two of the most significant expenses associated with home buying, according to him.

Eligibility Requirements:

➣ Minimum FICO credit score of 620 required, maximum debt-to-income ratio of 50%

➣ Must inhabit the home as their primary residence within sixty days of the closing date

➣ Must purchase a single-family, townhouse, condominium, or duplex residence.

➣ Must be a fresh acquisition (no refinancing)

➣ Residence options include either Marion County or Fort Wayne

First Place Federal Housing Authority program

Want to purchase your first home? Homebuyers who fulfill certain eligibility conditions may get down payment assistance of up to 6 percent of the home’s purchase price or appraised value, whichever is smaller, through the First Place program.

This help does not need monthly mortgage payments or interest from homebuyers.

As long as the home is not sold or refinanced within nine years of the closing date, the full amount of down payment assistance will be forgiven.

Alternatively, if they sell the home within nine years, make a profit on the sale of the home, and their household income for the year is greater than the year’s adjusted qualifying income for a family of that size, they must repay the original loan amount or half of the gain on the sale of the home, whichever is less.

Principal eligibility prerequisites:

➣ Must be a first-time buyer unless purchasing in a specified targeted region, a list of counties that includes Shelby County, or a qualified census tract within certain counties.

➣ Must have a minimum FICO credit score of 640 with a debt-to-income ratio of less than 45 percent, or a minimum score of 680 with a debt-to-income ratio between 45 and 50 percent.

➣ Meet the income requirements listed on the website of the Indiana Housing Authority. It varies by county.

One- or two-person households in Marion County cannot earn more than $81,600 unless they reside in a defined census tract, in which case they may earn up to $97,920.

The income ceiling for households with three members is $93,840. It is $114,240 if you reside in a defined census tract.

➣ The property must serve as your primary residence

Next Home Federal Housing Authority program

Even if you are not a first-time homebuyer, the Next Home program will assist you with your new home’s down payment.

This 30-year fixed-rate program will provide down payment assistance for the acquisition of a single-family house.

Homebuyers are eligible for assistance of up to 3.5% of the purchase price or the home’s appraised value, whichever is lesser.

It may be utilized alongside the mortgage credit certificate, which is discussed below.

Principal eligibility prerequisites

➣ Meet the income requirements listed on the website of the Indiana Housing Authority. The same income limitations and credit score requirements as the First Place program apply.

➣ The property must serve as your primary residence

Mortgage Credit Certificate (MCC)

First-time homebuyers and individuals purchasing single-family homes in Indiana are eligible for a federal income tax credit that reduces the amount of federal income tax the borrower must pay.

You may be eligible even if you are not a first-time homebuyer if you are a veteran or if you are purchasing a property in a designated targeted region.

When applying for a loan, homebuyers can apply for the mortgage credit certificate through a participating institution.

The mortgage credit certificate may only be utilized by individuals who do not currently hold a mortgage on the subject property.

The tax credit can be utilized alongside the Next Home program.

Principal eligibility prerequisites:

➣ Meet the income requirements listed on the Indiana Housing Authority’s website. It varies by county.

The same income limitations and credit score requirements as the First Place program apply.