HB4283 104TH GENERAL ASSEMBLY

LRB104 16472 KTG 29867 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB4283

Introduced 1/14/2026, by Rep. Michael Crawford

SYNOPSIS AS INTRODUCED:

20 ILCS 3805/7.34 new
30 ILCS 105/5.1038 new

Amends the Illinois Housing Development Act. Requires the Illinois Housing Development Authority (Authority) to establish and administer a First-Generation Homebuyer Down Payment Assistance Program to provide targeted assistance to eligible first-generation homebuyers throughout the State for the purchase of a single-family or non-commercial multi-family residence. Sets forth eligibility requirements. Permits the Authority to prioritize assistance to applicants purchasing homes in designated community priority areas, applicants with household income below 80%, and applicants purchasing homes in areas with low homeownership rates, high housing costs burdens, or limited access to affordable mortgage credit. Provides that assistance under the program shall be provided as a forgivable loan to be forgiven pro rata on a monthly basis over a 5-year period of continuous owner-occupancy. Sets forth the available loan amounts and provides that assistance funds may be used for down payments, closing costs, mortgage insurance, interest rate buydowns, or principal reduction. Permits the Authority to waive repayment in cases of documented financial hardship that is beyond the control of the homebuyer. Permits the Authority to adopt rules to implement and administer the program. Effective July 1, 2026.

A BILL FOR

AN ACT concerning State government.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Housing Development Act is amended by adding Section 7.34 as follows:

(20 ILCS 3805/7.34 new)

Sec. 7.34. First-Generation Homebuyer Down Payment Assistance Program.

(a) The General Assembly finds that:

(1) Homeownership remains one of the strongest pathways to long-term financial stability.

(2) First-generation buyers face additional barriers including lack of family homeownership history, limited intergenerational financial support, and higher upfront cost burdens.

(3) Illinois currently offers down payment assistance but does not have a program specifically tailored to first-generation homebuyers.

(b) The Authority shall establish and administer a First-Generation Homebuyer Down Payment Assistance Program. The Authority shall use moneys in the First-Generation Homebuyer Down Payment Assistance Fund, a special fund created in the State treasury, and any other funds appropriated for this purpose, to provide targeted assistance to eligible first-generation homebuyers throughout the State.

(c) For purposes of this Section, "eligible first-generation homebuyer" means an individual:

(1) who has resided in Illinois for at least one year immediately preceding his or her application for assistance;

(2) whose household income is at or below 120% of the area median income at the time of purchase;

(3) who meets the following criteria:

(A) has never owned a home or has not owned a home in the last 3 years;

(B)(i) has parents or prior legal guardians who have never owned a home, or (ii) was previously placed in foster care, kinship care, or institutional care prior to attaining the age of 18;

(4) if applicable, has a spouse or partner who also meets the requirements under paragraph (3);

(5) who completes a homebuyer education course approved by the U.S. Department of Housing and Urban Development or the Authority; and

(6) who plans on occupying the home as a primary residence. For purposes of this paragraph, "home" includes any non-commercial multi-family residence.

(d) The Authority may prioritize assistance applications from:

(1) applicants purchasing homes in designated community priority areas, as defined by the Authority;

(2) applicants with household income below 80% of the area median income;

(3) applicants purchasing homes in areas with low homeownership rates; and

(4) applicants purchasing homes in areas with high housing costs burdens or limited access to affordable mortgage credit.

(e) Assistance under this Section shall be provided as a forgivable loan. Eligible first-generation homebuyers may use assistance funds to purchase a single-family or non-commercial multi-family residence. The Authority may provide: (i) standard assistance that is the greater of 10% of the purchase price of a home or $20,000 per eligible first-generation homebuyer household; or (ii) community priority area assistance that is the greater of 15% of the purchase price of the home or $30,000 per eligible first-generation homebuyer household. The amount of assistance may be adjusted for market conditions over time at the discretion of the Authority. The assistance may be used for down payments, closing costs, mortgage insurance, interest-rate buydowns, or principal reduction.

(f) A forgivable loan provided under the Section shall be forgiven pro rata on a monthly basis over a 5-year period of continuous owner-occupancy. The Authority, in its discretion, may waive repayment in cases of documented financial hardship due to loss of income, disability, natural disaster, or some other circumstance beyond the control of the eligible first-generation homebuyer.

(g) The Authority shall do the following in furtherance of its administration of the program:

(1) Establish documentation and verification processes (including self-attestation under penalty of perjury for parental homeownership history) and fraud prevention measures.

(2) Conduct outreach to prospective buyers statewide.

(3) Provide multilingual information and homebuyer workshops.

(4) Issue an annual public report, to be posted on its official website, that provides data and information on assistance applicants, outcomes, assistance amounts, and home retention rates.

(h) The Authority may adopt any rules necessary to implement and administer the program.

Section 10. The State Finance Act is amended by adding Section 5.1038 as follows:

(30 ILCS 105/5.1038 new)

Sec. 5.1038. The First-Generation Homebuyers Down Payment Assistance Fund.

Section 99. Effective date. This Act takes effect July 1, 2026.