 "In today's climate when the country's foreclosure rate is at its
highest, hardworking Illinois families who dream of owning their own
home need all the help we can provide. This program is one more way
to offer an opportunity for dozens of families to afford a safe and
decent home for their children," Blagojevich said."The 30-year
I-Loan Mortgage program has already helped thousands of hardworking
families realize their dream of buying their first home. The fixed,
below-market interest rate ensures that families are locked in at an
affordable price that helps them gain stability and build equity for
the future. The 40-year I-Loan will allow us to help even more
first-time homebuyers by reducing monthly costs," said DeShana L.
Forney, executive director of the Illinois Housing Development
Authority.
The Illinois
Housing Development Authority is a self-supporting state agency
responsible for financing the creation and preservation of
affordable housing in Illinois through the sale of bonds and
investment of various state and federal resources. The agency raised
$15 million through tax-exempt bond financing to support the I-Loan
Mortgage program's expansion.
Expanding the I-Loan program provides another affordable option
for low- and moderate-income homebuyers. They can chose between the
30-year loan, which offers a low interest rate and will be faster to
repay but has a higher monthly payment, or opt for the new 40-year
loan with a slightly higher interest rate that will take a little
longer to pay off but reduces the monthly payment. It will also
allow the homebuyer to consider a higher priced, and often larger,
home.
More and more homeowners nationwide are facing foreclosure
because they can no longer keep up with the instability of
adjustable rate mortgages. Both the 30- and 40-year I-Loan offer
fixed interest rates that are significantly lower than the market
rate. In comparison, when the conventional market is offering around
6.65 percent, the 30-year I-Loan is set no higher than 6.25 percent,
while the new 40-year I-Loan will be offered at approximately 6.50
percent. For some families, this could mean the difference between
affording the house or not.
For example, with a conventional loan, a homebuyer purchasing a
house with a $100,000 loan at a 6.65 percent interest rate will pay
$641.96 in monthly payments. Under the 40-year I-Loan offering a
6.50 percent interest rate, the same homebuyer will pay $585.46 in
monthly payments. That translates into savings of $56.50 a month,
$678 a year and $27,120 over the life of the loan. The savings will
allow the homebuyer to afford to buy a higher priced house or keep
the savings for other everyday necessities.
[to top of second column]
 |
The Illinois
Housing Development Authority administers the I-Loan Mortgage
program on behalf of the state. The partner banks located throughout
the state work directly with the homebuyer to approve and originate
the loans. The agency then purchases the loans from the
participating lenders. To obtain an I-Loan Mortgage, homebuyers need
to contact one of the approved lenders listed at
www.ihda.org or call
1-877-ILOAN56.
Both the 30- and 40-year I-Loan Mortgage were created to ensure
first-time homebuyers fully understand the rights and
responsibilities of homeownership and to minimize the chance of
getting involved in a loan that is financially bad for the family.
In addition, I-Loan Mortgage recipients are encouraged to complete a
homeownership education course. Some I-Loan-approved homebuyers
opting for the 30-year loan may also be eligible for cash grants up
to $1,500 to meet down payment and closing costs.
To qualify for an I-Loan Mortgage, both 30- and 40-year loans, an
Illinois homebuyer must:
-
Be a first-time
homebuyer. Anyone who has not had ownership interest in his or
her primary place of residence in the past three years is
considered a first-time homebuyer.
-
Purchase the home as
a primary residence.
-
Meet income and
purchase price requirements.
-
Contribute 3 percent
of the purchase price toward the down payment.
-
Apply for the I-Loan
Mortgage with an IHDA-approved lender.
-
Move into the home
within 60 days of closing.
Since 2003, the I-Loan Mortgage program has helped more than
7,874 first-time homebuyers in 96 counties throughout the state
become homeowners with a total of $795 million in financing. In 2006
alone, the Illinois Housing Development Authority helped 1,973
people to buy their first homes with more than $217 million in
financing. County-specific production figures are available upon
request.
[Text from file received from
the
Illinois Office of
Communication and Information]
 |
