Transcript How Individual Development Accounts Work

The DHS Individual Development
Account Strategy – Home Ownership
Family or Individual
6-18 Month
Savings
Application
Online Financial
Education
Approval
Home
Purchase
Benefits of Individual
Development Accounts
• Savings and Match Funds Can Only Be Used Towards
the Purchase of a First Home
• Participants Can Save Up To $2,000 in their IDAs
• Participants Will Receive a $1 to $1 match - up to $2,000
• Participants Can Drop Out And Have Their Savings
Returned To Them, Without The Matching Funds
• In Some Cases, IDA Funds Can Be Combined With Other
First Time HomeBuyer Downpayment Assistance
Programs
Individual Development Account
Application Procedure
• Download Application
from the Internet or
Obtain one from a DHS
Office near you.
• Must Submit a Complete
Program Application
– Including Previous Year’s
Federal Tax Returns
– Including a Scored Credit
Report
•Submit Complete Application
•Scored Credit Report
•Last Year’s Federal Tax Returns
Individual Development Account
Guidelines
Applicants Must:
• Have Adjusted Gross
Income Less Than 200%
of Poverty Level
• Be A Current Resident of
the State of Illinois
• Have a Previous Year’s
Tax Return
• Have a Credit history that
will enable them to
purchase a home within 2
years.
Individual Development Account
Income Limits
Family Size
Gross Annual Income*
1
$20,420
2
$27,380
3
$34,340
4
$41,300
Submitting an Application
• Fax or Mail COMPLETED and SIGNED
applications to:
– (312)
– AFI c/o Kevin Davy
401 S. Clinton 7th Floor
Chicago, Illinois 60607
Securing DHS Application
Approval
• DHS will Review All
Applications that are
Complete.
• DHS will contact via phone,
email, or mail everyone who
applies.
• Funding is limited,
participants enrolled on a first
come, first served basis.
• Qualified applicants will be
put on a waitlist if all spots
are full.
6 to 18 Months Savings Period
• Once enrolled, participants
must save in their IDAs for at
least 6 Months and no more
than 24 months.
• All IDAs are held at National
City Bank – DHS staff will
help to set up the account.
• All participants must agree to
have funds withdrawn from
their existing bank account via
electronic funds transfer.
Financial Education Component
• Required for all Program
Participants
• Available Through The Federal
Deposit Insurance Corporation
Online
• Must Submit Certificates of
Completion for Courses Mandated
By DHS
• Courses offered by Financial Links
for Low Income People Trainers
Accepted As Compliance
The 9 Required
Money Smart Training Modules
• Bank on It
an introduction to bank
services
Borrowing Basics
an introduction to credit
Money Matters
how to keep track of
your money
Pay Yourself First
why you should save,
save, save
• To Your Credit
how your credit history will
affect your credit future
Charge It Right
how to make a credit card
work for you
Loan To Own
know what you're borrowing
before you buy
Your Own Home
what home ownership is all
about
• www.fdic.gov/consumers/con
sumer/moneysmart/mscbi/m
scbi.html
Homeownership Education
• Required for all Program Participants purchasing
Homes.
• Provided by Nonprofit Partners, HUD Certified
Homeownership Providers and Online Vendors
• Must provide proof of completed training to
program manager
Congratulations! You Are Now Ready
for Home Purchase!
• Must Save For At
Least 6 Months
• Cannot Save for More
Than 18 Months
• Must Complete Home
Purchase In Maximum
of 24 Months
Special Thanks to Our Partners
• The Illinois Department of
Human Services
• Partnership for
Homeownership
• The Illinois Housing
Development Authority
• The United States
Department of Human
Services, Administration
for Children And Families
• Financial Links for Low
Income People
• The Tax Counseling
Project