There is quite a bit of excitement that comes with purchasing your first home. Choosing your neighborhood, selecting a floor plan, and coordinating your décor are some of the enjoyable aspects, but other parts of the process are more work than fun.
For some homeowners, it can feel daunting and stressful to consider the factors that may put their dream home just slightly out of financial reach. Filling the gap between what you are able to afford and the cost of your dream home might seem impossible. However, there are options available to help new borrowers with their big investment.
If you are a first-time homebuyer in Indiana, you’re in luck! In addition to federal programs, the state of Indiana offers several programs to first-time buyers to assist with your mortgage rate, closing costs, and down payment. Here are several programs for first-time and repeat buyers to provide financial assistance. For details regarding specific program requirements and eligibility criteria, be sure to visit the individual website for more information.
Who qualifies as a first-time homebuyer in Indiana?
Indiana stipulates a first-time homebuyer as anyone who has not owned a home in the past three years as a primary residence. There are some exceptions to this, such as homeowners purchasing in an economically disadvantaged targeted area and some qualified veterans. When reviewing program opportunities, check the specific requirements for exceptions.
Statewide First-Time Buyer Programs
The following program is available statewide to Indiana residents.
The Indiana Housing and Community Development Authority (IHCDA) offers several programs exclusively to first-time buyers. The First Place (FP) program provides down payment assistance in the form of an FHA, 30-year fixed loan. Qualified veterans and individuals purchasing in targeted areas may also be eligible. Credit and income restrictions may apply, so be sure to visit the website for details.
Mortgage Credit Certificate
Also specifically for first-time homebuyers, the Mortgage Credit Certificate (MCC), also offered by the IHCDA, provides financial assistance through a federal income tax credit. This tax credit may help new borrowers by reducing their federal income tax liability and increasing their qualifying income. This may be combined with the Next Home program (see below) for eligible participants. Credit and income restrictions may apply; visit the IHCDA website for more information.
Statewide Non First-Time Buyer Programs
While the above programs are strictly available for first-time homebuyers, there are other statewide programs to assist individuals looking to move from one home they have owned into another.
The Indiana Housing and Community Development Authority (IHCDA) also offers the Next Home (NH) program. Eligible borrowers are not required to be first-time homeowners. This program provides down payment assistance in the form of an FHA, 30-year fixed loan. This may be combined with the Mortgage Credit Certificate for eligible participants. Credit and income restrictions may apply, so be sure to visit the IHCDA website for details.
Homebuyer Programs by Location
In addition to statewide programs, there are often homebuyer assistance programs based in different cities and regions of a state.
First-time homebuyers in In Bloomington, Indiana, residents may apply for financial assistance through HAND’s Down Payment and Closing Cost Assistance program. This program is exclusively for first-time homebuyers. Eligible borrowers may receive up to $10,000 in the form of a forgivable second mortgage to put toward down payments and/or closing costs. Income limits and other restrictions may apply, so be sure to review guidelines on their website before applying.
The City of East Chicago provides down payment and closing cost assistance in the form of a zero interest second mortgage of up to $25,000 for the purchase of a newly constructed home. To qualify for the New Homes Assistance program, the house must be constructed within East Chicago city limits. Other eligibility criteria may be required of qualified applicants.
First-time homebuyers in Elkhart may be interested in the city’s Neighborhood Revitalization Strategy Area (NRSA). This program provides down payment assistance for new homeowners purchasing in specified areas. See website for more application criteria and program contact information.
The City of Evansville receives funding through the federal program HOME to put toward efforts to promote home ownership in the city. The HOME Investment Partnerships Program provides assistance for low and very low-income families seeking homeownership. For more details and how to apply, visit their website.
First-time homebuyers in Fort Wayne may apply for financial assistance through the Fort Wayne Community Development Office. The city partners with several federal programs to receive funding to expand access to safe housing for all residents. Visit the city’s website for more information.
First-time homebuyers in Hammond may receive up to $2,500 to assist with their down payment on a new home through the city’s Homebound Program. Additional funds may be granted for police, fire, and education professionals. Income limits and restrictions apply. Qualified applicant must be a first-time homebuyer or has not owned a home in the previous 12 months. See website for more information.
If you are planning to settle down in the Indianapolis area, you might consider the Homeownership Opportunities Program (HOP) through FHL Bank Indianapolis. This incentive is exclusive for first-time homebuyers, though there are special exceptions. Be sure to check the website to see if you qualify as a first-time buyer and to learn more about income restrictions and eligible property requirements.
The City of Indianapolis also receives four entitlement grants from the U.S. Department of Housing and Urban Development (HUD) to support housing for individuals and families with low income, called Community Development Grants. Grant amounts are determined by the federal government based on recent census data. Read more about the application process by visiting their website.
First-time homebuyers in Lake County may be eligible for Lake County’s Homebuyer Assistance Program. Income limits and other restrictions apply. Qualified borrowers may be eligible for up to $5,000 in financial assistance to put towards closing costs, fees, or down payment assistance. See website for more information and to apply.
Finance Your New Home
If you plan to purchase your first home, or next home, in Indiana, hopefully these programs will give you a starting point to begin your research. By taking advantage of financial assistance programs such as those listed above, you can close the gap and land your new house even sooner. Your dream of settling down in this gem of the Midwest may be closer than you think!
The links on this site were researched by NewHomeSource. This is as cohesive a list as possible. Individual homebuyers should contact entities to fully understand requirements and processes.
Melanie Theriault is a writer, counselor, and lifelong learner. She holds a B.A. in Sociology from Southwestern University, where she discovered her passion for fostering human connection through storytelling.