Taxes are paid a year behind
Indiana bills property tax in arrears, in spring and fall. At closing the seller credits you their share, so park that money for the next bill instead of spending it on a couch.
First-time homebuyers
Buying your first home in Indiana, start to keys.
Short answer: In Indiana you can buy your first home with as little as 3% down on a conventional loan, 3.5% on FHA, or nothing down with a VA or USDA loan if you qualify. Plan on another 2% to 5% of the price for closing costs, and check down payment assistance before you assume you can't: INHP offers $7,500 to $24,999 in Marion County, and IHCDA's programs cover the whole state. Once your offer is accepted, closing usually takes about a month.
Buying your first house feels like being handed a 40-page instruction manual written in lender. Here's the whole thing in plain English: what it costs, what happens in what order, and the Indiana-specific stuff nobody mentions until it's on your closing statement.
Checked Oct 27, 2026
The numbers that matter
Conventional
Lowest down payment3%
Lowest down payment3%
FHA
Most borrowers3.5%
Most borrowers3.5%
VA or USDA
If eligible0%
If eligible0%
Closing costs
Of the price2–5%
Of the price2–5%
Loan minimums from each program's published rules; closing cost range from Freddie Mac. Your lender's Loan Estimate is the real number.
Do you count?
You might be a "first-time" buyer again.
For Indiana's state programs (IHCDA), you count as a first-time buyer if you haven't owned a home you lived in during the last three years. Sold a condo in 2021 and have been renting since? Welcome back. Veterans, and buyers in IHCDA's targeted census tracts, skip the first-time rule entirely. Lenders and other programs can define it their own way, so ask each one.
The real cash
What it takes to buy a $250,000 home.
An example, not a quote. Closing costs use Freddie Mac's typical range of 2% to 5% of the price ($5,000 to $12,500 here). Seller credits you negotiate and down payment assistance can cover some or all of it.
| Loan and down payment | Down payment | Plus closing costs | Cash to close |
|---|---|---|---|
| VA or USDA, 0% down | $0 | $5,000–12,500 | $5,000–12,500 |
| Conventional, 3% down | $7,500 | $5,000–12,500 | $12,500–20,000 |
| FHA, 3.5% down | $8,750 | $5,000–12,500 | $13,750–21,250 |
| 10% down (the typical first-time buyer) | $25,000 | $5,000–12,500 | $30,000–37,500 |
| 20% down (no mortgage insurance) | $50,000 | $5,000–12,500 | $55,000–62,500 |
Sources: Freddie Mac on closing costs. Loan minimums are explained on my mortgage calculator page. The 10% figure is the median first-time buyer down payment in NAR's 2025 Profile of Home Buyers and Sellers.
Think you need 20% down? That's myth number one, and most first-time buyers don't wait for it. Play the myth game and see how many of the other first-timer myths you've been told.
Loans and help
Where the money comes from.
| Option | Down payment | Good fit if | Watch for |
|---|---|---|---|
| Conventional | From 3% | Solid credit and a little saved | Mortgage insurance under 20% down |
| FHA | 3.5% for most | Credit is still a work in progress | Mortgage insurance that can last the life of the loan |
| VA | $0 | Veterans, service members, eligible spouses | A one-time funding fee for most |
| USDA | $0 | Buying in an eligible area, like the northern Hamilton County towns | Income limits; eligibility goes by exact address |
| INHP (Marion County) | $7,500–24,999 in help | Buying inside Indianapolis, credit 620+ | Takes time: class, assessment, documents |
| IHCDA (statewide) | A share of the price in help | Income under the limits | It's a 0% second loan, repaid when you sell or refinance |
Program details checked October 2026. Full breakdowns, income limits and sources: down payment assistance in Indy and loan types, in plain English.
How it actually works
Eight steps, in this order.
1
Take a homebuyer class.
IHCDA's programs require one, and INHP's start with theirs. It's free or close to it, a few hours, and you'll ask better questions for the rest of the process.
2
Know your numbers.
Check your credit, add up what you have saved, and decide what monthly payment lets you still sleep at night. That number matters more than what a lender says you can borrow.
Run the calculator3
Get pre-approved.
Pick a lender who actually does the programs you want; not all of them do. A real pre-approval checks your income and credit, so sellers take your offer seriously. I'm a Realtor, not a lender, but I'll introduce you to a couple of good ones.
4
Sign a buyer agreement and tour.
Since August 2024, agents need a written agreement with you before touring a home together. It spells out what I do and how I'm paid, and you can ask any question about it before you sign.
NAR's consumer guide5
Make an offer.
Price is one piece. Your financing, inspection timeline, closing date and earnest money (a good-faith deposit held until closing) all shape whether the seller says yes. Asking the seller to pay some closing costs is fair game too.
6
Inspect and appraise.
The inspection is your chance to learn the house before it's yours. Lots of Indy homes are older, so I often suggest radon and sewer scope tests too. For homes built before 1978, federal rules give you a 10-day window for a lead paint inspection.
EPA's lead disclosure rule7
Close.
Your lender has to send your Closing Disclosure at least three business days before closing. Compare it with your Loan Estimate, then wire nothing until you've confirmed the instructions by phone with the title company. Then you sign a lot and get keys.
CFPB's Closing Disclosure guide8
File your homestead.
Indiana's homestead deduction isn't automatic. The sales disclosure form at closing usually doubles as your application, but confirm it was filed. Skip it and your own home gets taxed like a rental.
How Indy property tax worksThe Indiana part
What nobody tells you until closing.
Your first bill is the seller's
The first bills reflect the previous owner's value and deductions. If they were a landlord, it can look scary. Your escrow catches up once your homestead kicks in.
There's a new homestead credit
Starting with 2026 bills, homeowners get a credit of 10% of the bill, up to $300, applied automatically once your homestead is on file.
Down payment help is usually a loan
IHCDA's help is a 0% second mortgage with no monthly payment, repaid when you sell or refinance. If someone says it's forgiven after nine years, that program ended in 2023.
Start the paperwork early
Start education and program paperwork before you house hunt. Assistance adds steps, and I'd rather plan a slightly longer closing than rush everyone.
Seller credits are negotiable
Asking the seller to cover part of your closing costs is common, especially on homes that have sat a while. Your loan type caps how much they can give, so we check before we ask.
Your next move
Not sure where you stand?
Grab a coffee with me. Twenty minutes, no pressure, and you'll leave knowing your real price range, which programs fit, and what to do first. Or start with the free Buyer Guide.
First-time buyer questions
The stuff people Google at midnight.
How much money do I need to buy my first house in Indiana?
For a $250,000 home, plan on roughly $12,500 to $21,250 with 3% to 3.5% down plus closing costs, or $5,000 to $12,500 with a no-down-payment VA or USDA loan. Closing costs typically run 2% to 5% of the price, and seller credits or down payment assistance can lower what you bring.
Who counts as a first-time homebuyer in Indiana?
For IHCDA's state programs, anyone who hasn't owned a home they lived in during the last three years. Veterans and buyers in targeted census tracts are exempt from the rule, and other lenders and programs can define it their own way.
Does Indiana have a first-time homebuyer program?
Yes. IHCDA's First Step program is built for first-time buyers statewide, and in Marion County INHP offers $7,500 to $24,999 in down payment assistance paired with its own mortgage. Several banks also run grant programs by census tract. My down payment assistance page compares them all.
What credit score do I need to buy a house in Indiana?
It depends on the loan and program. INHP's mortgage starts at a 620 score, and IHCDA lenders generally look for 660 or higher. A higher score mostly buys you a better rate and cheaper mortgage insurance, so talk to a lender before you rule yourself out.
How long does it take to buy a house?
Once your offer is accepted, closing usually takes about a month. Finding the house can take a weekend or a few months, and down payment assistance can add a few days, so starting the class and pre-approval early is the biggest time saver.
Do I have to sign something before touring homes with an agent?
Yes. Since August 2024, agents who are REALTORS® need a written agreement with you before touring a home together. It spells out the agent's services and how they're paid, and the amount is negotiable. Walking into a public open house on your own doesn't require one.
What do I do after I close?
Make sure your homestead deduction is filed with the county auditor, since it isn't automatic, and set aside the property tax credit the seller gave you at closing for the next bill. Then change the locks and find the water shut-off before you need it.
Keep going
Down payment helpEvery program in Indy, what it costs you, and who qualifies.
Mortgage calculatorYour real monthly payment and cash to close for any address.
Property taxesThe rate for any address, with homestead savings.
Myth BustersThe first-timer myths, busted in a retro game.
Moving to IndyNew to the city? Start here.
City toursSee the city with me before you pick a place.
General information checked on October 27, 2026, not a loan offer or legal advice. Loan programs and limits change; confirm terms with a lender. I'm a Realtor with @properties and don't originate loans.
