Most Indiana buyers hear “zero down” and immediately think FHA. It’s understandable because FHA loans have been the default conversation for low-down-payment financing for decades. However, this assumption can limit flexibility, negotiating opportunities, and long-term value.
Conventional no-down-payment options exist right now in Indiana that many buyers never hear about. Choosing the right one instead of defaulting to FHA influences everything from property condition requirements to monthly costs.
If you’re preparing to buy your first home or your next one, here’s what you need to know about zero-down conventional mortgage options in Indiana.
Tevis Durbin (NMLS #424899) | Producing Branch Manager, Supreme Lending | 26+ years mortgage experience | CMA | MBA in Finance | State Board Member, Mortgage Bankers of Indiana | Communication Chair, Hamilton County division of MIBOR
The Default Assumption Shapes Indiana Buyers’ Options
The moment most buyers say, “I don’t have a down payment,” the conversation often moves straight to FHA. It’s the default for many lenders. FHA is also the assumption that an online calculator will default to.
But they aren’t the best fit for every no-down-payment buyer. FHA loans carry stricter property condition requirements than conventional loans. If a home has peeling paint, a compromised roof, or deferred maintenance, an FHA appraisal can flag issues that may require repairs before closing. Conventional loans, governed by Fannie Mae’s underwriting guidelines, offer more flexibility on home condition.
That matters in today’s Indiana housing market, where a significant portion of available inventory is 20 to 30 years old. If needing a zero-down loan leads you toward FHA by default, you may be narrowing your pool of available homes before making an offer.
Two Conventional Zero-Down Mortgage Programs Worth Knowing
Indiana Housing offers a conventional no-down-payment program that many buyers do not encounter in their research. It’s not the same as the standard FHA-backed down payment assistance that appears in a typical Google search.
Supreme Lending also offers the Supreme 100 program. It’s a conventional financing option that allows qualified buyers to purchase with no money down.
Both programs carry their own qualification requirements. Credit score thresholds generally range from 640 to 660. Debt-to-income (DTI) guidelines, income limits, and purchase price caps vary by county. Income limits run from approximately $88,200 to $141,000, and purchase price caps reach up to $453,100. Completion of a HUD-approved homebuyer education course is also required for IHCDA programs.
For buyers who qualify, going conventional rather than FHA can open up more properties and offer greater negotiating flexibility. It also offers a smoother path to closing in many cases.
Which program fits your situation? A 15-minute conversation usually answers it. Reach out to Tevis and the team at Supreme Indiana before you start searching.
Stacking Assistance Is Powerful, but It’s Not Always the Right Move
One of the more strategic approaches available right now involves using a no-down-payment program even when a buyer has some savings set aside.
If a buyer’s priority is the lowest possible monthly payment, layering a state program with personal funds can produce a good outcome. The state’s assistance reduces the loan amount, and the buyer’s cash reduces it further. The combined effect targets the monthly payment rather than just the upfront obligation.
Seller concessions can layer on top of that. With the market leaning toward buyers, sellers are showing greater flexibility with price reductions, concessions, and repair requests than in recent years. That creates an opportunity to structure financing to support both upfront affordability and long-term payments.
For a deeper look at how this plays out in practice, read our article on why affordability isn’t getting better and what smart buyers are doing about it. It covers the current landscape from a buyer’s perspective.
The Question Most Hamilton County Buyers Forget to Ask
Most buyers arrive at the financing conversation with one assumption already in place. Tevis Durbin has seen that pattern repeat across thousands of buyer conversations over more than two decades.
“Conventional gives you a little bit more leeway. Indiana Housing offers a conventional no-down-payment program, and then we have the Supreme 100. Most of them feel like it has to go FHA, and we do have a couple conventional questions, so we’re trying to get the word out.” – Tevis Durbin, Producing Branch Manager (NMLS #424899)
The renovation loan connection matters here. Many Indiana homes built 20 to 30 years ago are carrying their original HVAC systems, dated kitchens, and aging appliances.
Buyers who understand renovation financing, structured as conventional loans, can address those updates at the time of purchase. Some options allow you to roll the cost into the loan rather than handling them separately after closing. That expands the range of possibilities available to buyers before the search even begins.
You can read more about how renovation financing works in the full breakdown of how 203k loans turn scary repairs into real affordability.
The Next Home Program for Buyers Who’ve Owned Before
Indiana Housing’s programs aren’t limited to first-time buyers. The Next Home program is available to buyers who have previously owned a home. That includes people who owned a home a few years ago, sold it, and are now renting while planning their next purchase.
This often comes as a surprise. A buyer who owned a home within the last three years may assume they’re not eligible for state assistance. In reality, they may still qualify. The Next Home program carries different eligibility requirements than the First Place program.
The details matter and are worth reviewing before making assumptions. For buyers who want to understand the full picture of available loan programs, the mortgage programs overview is a good starting point.
Renovation Financing Can Factor Into a Zero Down Strategy
It’s worth pausing on this connection, as many buyers don’t make it immediately.
When a buyer uses a conventional zero-down program to purchase a home that needs work, the assumption is often that repairs are done later, out of pocket, after move-in. However, conventional renovation loans allow buyers to roll repair costs into the purchase financing. The result is a single loan with a single closing.
For Indiana buyers purchasing older homes with conventional no-down-payment programs, renovation financing provides a way to balance affordability and condition. This combination is not widely discussed, and many buyers do not realize it is available.
Common Questions About Zero Down Options in Indiana
What is the zero-down conventional mortgage option in Indiana?
Indiana buyers have two main conventional zero-down options: the IHCDA conventional program and the Supreme 100 program through Supreme Lending. Both allow qualified buyers to purchase without a down payment while applying conventional property condition standards.
How is a conventional zero-down mortgage different from an FHA?
The primary difference most buyers notice is in property condition requirements. FHA appraisals flag a wider range of repair issues before a loan can close. Conventional loans are generally more flexible regarding property condition. For Indiana buyers shopping older inventory, that difference can determine which homes are actually available to them.
Can I use Indiana Housing’s assistance if I’ve owned a home before?
Yes. Indiana Housing’s Next Home program is designed for buyers who have previously owned property. If you owned a home within the last few years, it’s worth exploring before assuming you don’t qualify.
Can I stack a state down payment program with seller concessions?
Yes. Seller concessions and state assistance programs can be used together in the same transaction. In the current market, buyers have a real opportunity to combine multiple forms of assistance into a lower monthly payment or reduced upfront cost.
Can I use a state program even if I have savings for a down payment?
Yes, and in some cases it makes strategic sense. If your goal is the lowest possible monthly payment, layering state assistance with your own funds can produce a better outcome than either approach alone. A lender familiar with these programs can model both scenarios side by side so you can see the actual numbers.
What credit score do I need for Indiana Housing programs?
Indiana Housing’s conventional programs generally require a minimum credit score of 640-660. Income limits vary by county, running from approximately $88,200 to $141,000. Purchase price caps reach up to $453,100, depending on the county. Completion of a HUD-approved homebuyer education course is also required before closing.
What if I’m not sure which program applies to my situation?
The fastest way to find out is a direct conversation with a lender who works with these programs regularly. Credit score, income, purchase price, and prior homeownership history all affect which path makes the most sense. A quick call with Tevis and the team at Supreme Indiana can sort it out in a single conversation.
Find Out Which Indiana Programs Work for Your Situation
Most buyers arrive at the financing conversation with one assumption already in place. The ones who explore a few additional questions often walk away with more options, better terms, and a clearer picture of what they can afford.
Zero down doesn’t have to mean an FHA loan. Conventional zero-down mortgage options exist in Indiana right now.
Tevis Durbin and the team at Supreme Indiana work with these programs every day. Schedule a conversation with Tevis and find out which program fits your situation before you start searching.
Tevis Durbin is the founder of Supreme Lending. He is a Certified Mortgage Advisor (CMA), holds an MBA in Finance, and serves as a State Board Member for the Mortgage Bankers of Indiana, with a 97.75% five-star customer rating built over more than 26 years in the mortgage industry.