Buying your first home around Bourbonnais can feel exciting and overwhelming at the same time. You might be hearing about down‑payment help, special loans, and income limits, but it is hard to know what applies to you in Kankakee County. This guide breaks down the main first‑time buyer programs, how to compare lenders, and the exact steps to verify eligibility for homes near Bourbonnais. You will leave with a simple plan and trusted resources to check everything yourself. Let’s dive in.
Your main options at a glance
IHDA programs in Kankakee County
The Illinois Housing Development Authority offers first‑mortgage products paired with down‑payment assistance for eligible buyers across the state, including Kankakee County. Programs often include a 30‑year fixed loan plus either a grant, forgivable second, or deferred second mortgage for assistance. Income and purchase‑price limits apply, and you apply through participating local lenders. Review current offerings and lender directories on the Illinois Housing Development Authority.
FHA loans
FHA loans are popular with first‑time buyers who want flexible credit guidelines. The minimum down payment is typically 3.5% for scores of 580 or higher. FHA loans include an upfront mortgage insurance premium of about 1.75% of the loan amount, plus an annual premium paid monthly. Confirm current mortgage insurance rules and county loan limits on HUD.
USDA Rural Development
If the property address is eligible, USDA guaranteed loans can offer 0% down financing. Eligibility depends on the exact location using the USDA rural‑area map, plus household income limits that vary by county and family size. Many parts of Kankakee County may qualify, though some areas closer to town centers might not. Check any address using the USDA property eligibility tool.
Conventional with 3% down
Conventional programs like Fannie Mae HomeReady and Freddie Mac Home Possible allow as little as 3% down for eligible first‑time or low‑to‑moderate income buyers. These loans typically require private mortgage insurance (PMI), which you can often cancel once you reach about 20% equity. Program rules and income limits vary, so review details for Fannie Mae HomeReady and Freddie Mac Home Possible and confirm specifics with your lender.
How to choose the right fit
Match your goal to the program
- If you need the lowest upfront cash: Explore USDA for eligible addresses or IHDA with down‑payment assistance.
- If your credit profile is still building: FHA may offer more flexibility than standard conventional loans.
- If you prefer mortgage insurance that can be canceled: Conventional 3% options may fit better than FHA over time.
Compare total monthly cost
- Look at principal and interest, mortgage insurance type and amount, and property taxes and insurance.
- Review whether mortgage insurance lasts for the life of the loan (common with higher‑LTV FHA) or can be removed (typical with conventional PMI at certain equity levels).
- Ask how down‑payment assistance affects your payment or equity.
Use Loan Estimates, not just rates
Always compare formal Loan Estimates from multiple lenders for the same price and closing date. The CFPB explains how to compare Loan Estimates and what to watch for in fees and terms on the Consumer Financial Protection Bureau site.
Local eligibility checks for Bourbonnais
Confirm address and income factors
- USDA: Some parts of Kankakee County are eligible while others are not. Run each property through the USDA property eligibility tool and verify county income limits.
- FHA: County loan limits and mortgage insurance rules can change. Review guidance on HUD and confirm details with your lender.
- IHDA: Programs, purchase‑price caps, and income limits are updated periodically. Review the latest options on IHDA and apply through an IHDA‑participating lender.
Education and counseling resources
Some programs require a homebuyer education certificate. You can find a counselor who serves Kankakee County through the HUD‑approved housing counselor locator. Counselors help you understand program rules, review credit, and prepare a budget that fits your goals.
How to shop and compare lenders
Ask each lender for the same scenario
Request a written Loan Estimate for the exact loan type you want to compare, such as FHA, USDA, conventional 3%, or an IHDA first mortgage with DPA. Keep the purchase price, down payment, and closing date identical across quotes. Include at least one IHDA‑participating lender so you can see how assistance changes your upfront cash and monthly payment.
What to review line by line
- Interest rate and APR
- Origination charges, lender credits, and discount points
- Prepaid items and third‑party closing costs
- Mortgage insurance type and monthly amount
- The duration of mortgage insurance
- DPA structure: forgivable, deferred, or repayable second mortgage, plus terms
- Any lender overlays and rate‑lock policy
Pro tip: Weigh total cost, not only rate
A slightly higher rate with lender credits can beat a lower rate with big upfront fees. Consider whether FHA’s mortgage insurance might cost more over time than cancelable PMI on a conventional loan. If you expect to stay long term, the structure and length of mortgage insurance can make a big difference.
Action plan for Bourbonnais first‑time buyers
Before you talk to a lender
- Gather documents: ID, Social Security numbers, recent pay stubs, last 2 years of W‑2s or tax returns, and recent bank statements.
- Pull your credit reports and fix errors. Knowing your score range helps you target the right loan type.
- Define a comfortable monthly payment and your available down payment or gift funds.
Verify program eligibility early
- IHDA: Review current programs, limits, and lender lists on IHDA.
- USDA: Check each property using the USDA property eligibility tool and confirm county income limits.
- FHA: Review mortgage insurance rules and county loan limits on HUD.
- Conventional 3%: Ask lenders about HomeReady or Home Possible income limits and first‑time buyer definitions.
When comparing loan offers
- Collect at least three Loan Estimates covering your top choices.
- Ask if DPA is forgivable, deferred, or repayable, and how it impacts PMI or MIP.
- Confirm underwriting timelines and whether servicing stays with the lender after closing.
Extra local tips
- Keep credit steady and avoid new debt until after closing.
- Budget for property taxes and homeowner’s insurance in your monthly estimate.
- If a class is required, schedule it early through the HUD‑approved housing counselor locator.
Ready to take the next step?
If you want a clear path from pre‑approval to closing, you do not have to figure it out alone. As a full‑time local advisor, I help you line up the right lender options, understand DPA choices, and target homes that fit both the programs and your budget. If you are thinking about buying in Bourbonnais or anywhere in Kankakee County, let’s build a plan that fits your timeline and comfort level. Reach out to Leanne Provost to start a friendly, no‑pressure conversation.
FAQs
What is a first‑time homebuyer for IHDA, FHA, and conventional?
- Most programs define a first‑time buyer as someone who has not owned a home in the past 3 years, but definitions can vary by program, so confirm with IHDA, your lender, or the program’s official site.
How much down payment do I need near Bourbonnais?
- Common options include USDA at 0% down for eligible properties, FHA at 3.5% for qualifying scores, and conventional at 3% for eligible first‑time buyers; IHDA can add assistance on top of your first mortgage.
Is USDA financing available in Kankakee County?
- Possibly, but eligibility depends on the exact address and your household income; check any property using the USDA property eligibility tool and confirm county limits.
Do FHA mortgage insurance premiums ever end?
- FHA’s annual mortgage insurance can last for the life of the loan at higher loan‑to‑value ratios; conventional PMI can usually be canceled once you reach sufficient equity or through a refinance.
Where do I verify current IHDA and loan rules?
- Review IHDA program pages, FHA and loan limit details on HUD, USDA’s eligibility tool, and Fannie Mae and Freddie Mac for HomeReady/Home Possible, then confirm with an IHDA‑participating lender.
