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State Guide

First-Time Homebuyer Programs in Indiana

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Overview

Indiana first-time homebuyer assistance is led by the Indiana Housing and Community Development Authority (IHCDA), which runs three core first mortgage programs - My Home, Next Home, and Affordable Home - each paired with different down payment assistance options and targeted at different buyer profiles. My Home offers a below-market 30-year fixed-rate first mortgage bundled with down payment assistance for first-time buyers (and repeat buyers in federally targeted areas). Next Home delivers up to $10,000 in DPA (or up to a percentage of the purchase price) and is open to both first-time and repeat buyers without the targeted-area restriction. Affordable Home is reserved for buyers at or below 80% of area median income and offers the deepest subsidy of the three. In Indianapolis, the Indianapolis Neighborhood Housing Partnership (INHP) provides up to $14,999 in additional down payment assistance designed to stack with IHCDA programs, and Fort Wayne runs a city-level Homebuyer Assistance Program providing up to $10,000.

Down Payment Assistance Programs

  • IHCDA My Home. A 30-year fixed-rate first mortgage at a below-market interest rate, available with FHA, VA, USDA-RD, or conventional underwriting. My Home is open to first-time buyers statewide and to repeat buyers in federally targeted areas, and it is bundled with down payment assistance (typically 3.5% of the purchase price) structured as a second lien. Standard pick for first-time Indiana buyers who want the lowest-friction stack of first mortgage plus DPA from a single agency.
  • IHCDA Next Home Down Payment Assistance. Up to $10,000 (or up to a percentage of the purchase price, depending on loan type) in down payment and closing cost assistance, available with a 30-year fixed-rate first mortgage. Next Home is open to both first-time and repeat buyers - no first-time-buyer restriction - and does not require the property to be in a federally targeted area, making it the most broadly accessible IHCDA DPA. Structured as a second lien with terms (forgivable vs. repayable) depending on the loan product selected.
  • IHCDA Affordable Home. The deepest-subsidy IHCDA program, reserved for buyers at or below 80% of area median income for their county and household size. Affordable Home pairs a below-market 30-year fixed-rate first mortgage with down payment assistance and is designed for buyers who would struggle to qualify for standard market-rate financing. Income limits are stricter than My Home or Next Home, but the underwriting and rate structure are more accommodating for buyers with limited income.
  • IHCDA Mortgage Credit Certificate (MCC). A federal tax credit equal to a percentage of the annual mortgage interest paid (capped at $2,000 per year), available to eligible first-time buyers using IHCDA financing. The MCC reduces federal income tax liability dollar-for-dollar each year for the life of the loan as long as the home remains the buyer's primary residence.

Income and Purchase Price Limits

IHCDA income and purchase price limits vary by county, household size, and program (My Home, Next Home, and Affordable Home each have their own limits). Income limits generally range from roughly $80,000 in lower-cost Indiana counties to $120,000+ in the Indianapolis-Carmel-Anderson metro for 1-2 person households on My Home and Next Home, with Affordable Home capped at 80% AMI for the county. Purchase price limits typically fall in the $325,000-$450,000 range across most of the state. Always confirm current IHCDA income and purchase price limits with an IHCDA-approved lender or at ihcda.in.gov before assuming eligibility.

City Programs Worth Knowing

Indianapolis and Fort Wayne each run city-level down payment assistance designed to stack with IHCDA's first mortgage programs. INHP's Indianapolis program is the largest by award size in the state outside of statewide IHCDA funding.

  • Indianapolis Neighborhood Housing Partnership (INHP) Down Payment Assistance. Administered by the Indianapolis Neighborhood Housing Partnership for income-qualified first-time buyers purchasing a primary residence in Marion County (Indianapolis), INHP provides up to $14,999 in down payment and closing cost assistance. Structured as a deferred or forgivable second mortgage with multi-year owner-occupancy requirements, HUD-approved homebuyer education required (INHP runs its own widely respected education program), and designed to stack with IHCDA My Home, Next Home, and Affordable Home. INHP also provides one-on-one homebuyer counseling that is often required by program guidelines.
  • City of Fort Wayne Homebuyer Assistance Program. Up to $10,000 in down payment and closing cost assistance for income-qualified first-time buyers purchasing a primary residence inside Fort Wayne city limits. Structured as a deferred or forgivable second mortgage with multi-year owner-occupancy requirements, HUD-approved homebuyer education required, and designed to stack with IHCDA programs. Funding cycles can exhaust mid-year - confirm availability with the City of Fort Wayne Community Development Division before applying.

Both city programs run on funding cycles that can exhaust mid-year, and homebuyer education must be completed before application - not after offer acceptance. INHP's education and counseling pipeline is the gold standard in Indianapolis and is typically required by INHP's program guidelines; plan that step into the front of your timeline.

FHA Loan Requirements in Indiana

FHA loans are widely used by Indiana first-time buyers and are compatible with all three IHCDA first mortgage programs (My Home, Next Home, Affordable Home), INHP's Indianapolis DPA, and Fort Wayne's Homebuyer Assistance Program. Across most of Indiana, FHA loan limits use the standard single-family ceiling.

Minimum requirements to qualify for an FHA loan in Indiana:

  • Credit score: 580 or higher for 3.5% down payment with standard FHA. IHCDA programs typically require 640 or higher (660 for some conventional options).
  • Down payment: 3.5% of the purchase price with a 580+ credit score. IHCDA My Home or Next Home DPA plus INHP (up to $14,999) can cover this and most closing costs in Indianapolis.
  • Debt-to-income ratio (DTI): Generally 45% or below for IHCDA (FHA itself allows up to 50% with compensating factors).
  • Employment history: Two years of consistent employment or verifiable income history.
  • Primary residence: FHA loans require owner occupancy - not eligible for investment properties or vacation homes.
  • Mortgage insurance: FHA loans require an upfront mortgage insurance premium (UFMIP) of 1.75% of the loan amount, plus an annual premium of 0.45% to 1.05%.

FHA loan limits in Indiana for 2025:

FHA loan limits in Indiana use the standard single-family limit of $524,225 across most counties. Confirm the current limit for your target county at HUD.gov.

Stacking FHA with IHCDA and city DPA programs:

The most efficient structure for an Indianapolis first-time buyer is an FHA-backed IHCDA My Home or Next Home first mortgage (with built-in or attached DPA) layered with INHP assistance (up to $14,999) - potentially up to roughly $25,000 in combined assistance. In Fort Wayne the comparable stack is IHCDA plus the City of Fort Wayne program (up to $20,000 combined). Lower-income buyers may qualify for Affordable Home, which provides deeper subsidy from IHCDA alone. An IHCDA-approved lender experienced with the relevant city program can confirm which combination applies to your income, credit, and target property.

How to Apply

  1. Confirm you have not owned a primary residence in the past three years for IHCDA My Home (Next Home has no first-time-buyer restriction; Affordable Home requires income at or below 80% AMI).
  2. Check your credit score - 580 is the FHA minimum for 3.5% down, and IHCDA typically requires 640 or higher.
  3. Review current IHCDA income and purchase price limits for your county and the specific program (My Home, Next Home, Affordable Home) at ihcda.in.gov.
  4. Decide which IHCDA program fits your profile: My Home for typical first-time buyers, Next Home if you've owned before or want broader flexibility, Affordable Home if you're at or below 80% AMI.
  5. If you're buying inside Indianapolis/Marion County, contact INHP early - their education and counseling pipeline is typically required and can take several weeks to complete.
  6. If you're buying inside Fort Wayne city limits, contact the City of Fort Wayne Community Development Division to verify program availability and current funding.
  7. Complete a HUD-approved homebuyer education course - required by IHCDA and by both city programs. INHP's course is the gold standard for Indianapolis buyers.
  8. Select an approved lender on both the IHCDA list and (if applicable) the relevant city program's participating lender list.
  9. Apply through your approved lender, who will coordinate the IHCDA application and the city program submission simultaneously.

FAQ

What's the difference between My Home, Next Home, and Affordable Home?

My Home is for first-time buyers (or repeat buyers in federally targeted areas) and bundles a below-market first mortgage with attached DPA. Next Home has no first-time-buyer restriction and provides up to $10,000 in DPA with a 30-year fixed-rate first mortgage - it's the most broadly accessible IHCDA program. Affordable Home is reserved for buyers at or below 80% of area median income and provides the deepest subsidy of the three. Most first-time Indiana buyers start with My Home; buyers who've owned before or who want the most flexible eligibility use Next Home; lower-income buyers use Affordable Home.

What credit score do I need for IHCDA programs?

IHCDA programs generally require a minimum credit score of 640 for FHA, VA, and USDA loans, and 660 for some conventional options. FHA itself allows scores as low as 580 for 3.5% down, but IHCDA's overlay is higher. If your score is between 580 and 639, a standard FHA loan is still available through non-IHCDA lenders, but you would not be eligible for IHCDA's below-market rate or attached DPA simultaneously.

How much assistance can I actually get in Indianapolis?

An eligible first-time buyer purchasing in Marion County (Indianapolis) can stack IHCDA My Home or Next Home DPA with INHP's assistance (up to $14,999) - meaning up to roughly $25,000 in combined assistance, depending on the IHCDA product selected and the purchase price. INHP's education and counseling pipeline is typically required, so plan that step into the front of your timeline.

Do I have to be a first-time buyer to use IHCDA?

Not necessarily. My Home requires first-time buyer status (no primary residence in the past three years) except in federally targeted areas, where repeat buyers can also qualify. Next Home has no first-time buyer restriction - repeat buyers can use it statewide. Affordable Home does not have a first-time buyer restriction but is limited to buyers at or below 80% AMI. If you've owned before, Next Home is typically the right starting point.

Can I use IHCDA and a city DPA program together?

Yes - both INHP (Indianapolis) and the City of Fort Wayne program are designed to stack with IHCDA My Home, Next Home, and Affordable Home. The first mortgage and primary DPA come from IHCDA, and the city program provides an additional second or third lien on top. Your lender coordinates both applications in parallel. INHP's homebuyer education typically satisfies both IHCDA and INHP requirements if completed through INHP's own program.

How long does it take to close using IHCDA plus a city DPA program?

Expect 45 to 70 days. IHCDA-only closings track close to standard timelines (35-45 days), but adding a city DPA program (INHP or Fort Wayne) adds an agency review step that extends closing by 15 to 30 days. INHP's required counseling and education can add several weeks on the front end, so complete it before you start house hunting - not after offer acceptance.