For many homebuyers across Indiana, qualifying for a mortgage isn’t the hardest part of buying a home; it’s coming up with the cash needed for the down payment and closing costs. Even buyers with steady income and solid credit often find that upfront costs delay their plans for homeownership, especially those entering the market for the first time.
The First Step Program from the Indiana Housing and Community Development Authority helps solve that problem by offering flexible loan options and down payment assistance designed to make homeownership more accessible.
What This Program Offers
The First Step Program provides financial assistance specifically designed to lower the cash required at closing while offering accessible financing options.
Key program benefits include:
- Down payment assistance that can be used toward down payment and closing costs
- Up to 6% of the purchase price available through First Step + Down Payment Assistance
- Assistance structured as a forgivable second mortgage
- In many cases, no repayment required after a 5–7 year forgiveness period
- Compatible with fixed-rate mortgages and FHA-insured loans
- Can be paired with IHCDA programs such as First Place or Next Home
Because the assistance is forgivable over time, buyers who remain in the home through the required period may effectively receive the funds as a grant.
Who This Program Is Designed For
The First Step Program is designed for buyers who are ready to purchase a home but need support covering upfront expenses or qualifying through traditional financing.
This program may be a good fit for:
- First-time homebuyers entering the market
- Buyers who have not owned a home in the past three years
- Households with moderate income levels
- Buyers with limited savings or less established credit history
Depending on location and eligibility, some program variations may also be available to repeat buyers.
Eligibility Snapshot
While exact limits vary depending on location and household size, typical program guidelines include:
- Meeting income and purchase price limits based on county
- Minimum credit score of 640 (higher for certain loan types)
- Completion of a homebuyer education course
- Purchase of a primary residence in Indiana
- Ability to qualify through an IHCDA-approved lender
These requirements are designed to support sustainable homeownership and long-term financial stability.
Who Should Take Action
Buyers who feel ready to own a home but are held back by upfront costs or strict traditional loan requirements should consider exploring this program.
For many households, combining flexible financing with forgivable assistance can make the difference between continuing to rent and stepping into homeownership sooner.
What to Do Next
If you’re considering buying a home in Indiana, reach out to an IHCDA-approved lender to learn more about the First Step Program and available down payment assistance options. A lender can help you determine your eligibility, walk you through the application process, and estimate how much assistance you may qualify for.
The First Step Program is one of several homebuyer assistance options available in Indiana. Depending on your goals and financial profile, there may be additional programs that can further reduce your upfront costs and improve affordability.
Visit HomebuyerWallet.com to explore other homebuyer programs that may be available to you.
