Homebuyer Education
Requirements
Partnered Providers
All Providers
Landlord Edu. Providers
IHDA Programs require all homebuyers take a pre-purchase education course before taking the big step.
This helps ensure that you're financially prepared with the information you need to be a homeowner!
Whether you're a homebuyer or lender, find everything you need to know about pre-purchase education here.
Main Requirements
The following homebuyer education requirements are required on all IHDA Mortgage Transactions:
Course Requirements - ALL Transactions
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Meet standards defined by HUD, or the National Industry Standards for Homeownership Education and Counseling.
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Be completed by all borrowers listed on the transaction (non-borrowing spouses are not required to complete a course).
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Provide a certificate with the borrower(s) name(s) and completion date. For transactions with multiple borrowers, the names can be on the same certificate (if allowed by the education course) or separately on multiple certificates. Either is acceptable so long as all borrowers are represented.
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Be completed prior to closing and no more than one year prior to the closing date.
IMPORTANT: Files that do not complete pre-purchase education prior to close are not eligible for delivery to IHDA, we are unable to make any exceptions on this policy, it cannot be remedied post-closing.
Other Requirements
Depending on the transaction, there may be additional items that can require specific courses:
Two Unit Properties
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FNMA loan type: Landlord education is required in addition to homebuyer education prior to closing, for purchase transactions secured by 2-4 unit properties when the LTV exceeds the LTV permitted under HomeReady (Eligibility Matrix). On purchase transactions that do not meet these criteria, landlord education is not required but is encouraged by IHDA Mortgage.
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FHLMC loan type: Landlord Education is required in addition to homebuyer education. All borrowers must complete a course prior to closing as evidenced by a certificate. For transactions with multiple borrowers, the names can be on the same certificate (if allowed by the education course) or separately on multiple certificates. Either is acceptable so long as all borrowers are represented.
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FHA or VA loan type: Landlord Education is not required, but encouraged by IHDA Mortgage.
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USDA: Two-unit property types are not allowed.
Debt-To-Income Ratio
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All borrowers on transactions with a debt-to-income ratio > 45.00% must complete the Finally Home! pre-purchase education course. Borrowers on transactions with a debt-to-income ratio < 45.00% may utilize any approved course.
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DTI is determined per final AUS run.
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Lenders are required to review the file for the borrower and advise if this course is required.
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Finally Home! is NOT required in addition to another homebuyer education course, this satisfies the requirement. However, please note, landlord education is still required if applicable to the transaction (as stated above).
Other Important Items to Note
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IHDA does not require a specific course per loan type, for example a Fannie Mae course may be used to satisfy a Freddie Mac loan. This way if you need to change loan type and a course has already been taken your borrower will not need to take an additional course.
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Homebuyer Education is required for ALL borrowers on the transaction, regardless of first-time-homebuyer status or current homeownership.
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IHDA cannot provide access codes or discount codes for courses, lenders should reach out to their operations team to see if they have an account with the applicable provider.
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IHDA's current process requires the homebuyer education certificate to uploaded in order to lock the loan. In the event that the course cannot be completed by the time of the lock, lenders may upload an LOX stating which course the borrower intends to take and when they plan to take it. Please note, if a pre-purchase education course is not taken prior to close, it cannot be taken after, rendering the loan non-compliant.
Community First® Housing Counseling Resource Program
For those considering owning their own home but aren’t sure if the time is right, IHDA partners with the Federal Home Loan Bank of Chicago to administer the Community First® Housing Counseling Resource Program (HCRP).
HCRP expands support for low- and moderate-income would-be homebuyers, helping them navigate the process and determine if homeownership is the right choice.
All sessions are offered free or low-cost and are both offered in person and virtually throughout Illinois. Please note, IHDA Mortgage does not determine the price of any course, contact the provider directly for more information.
