Iowa First-Time Home Buyer Programs

Happy African American Family Moving Into Home

Buying your first home in Iowa can be very expensive and frightening if you have no idea of the available funding you can take advantage of. The entire process would likely include financial conversations and situations you may have never encountered before. Fortunately, the Iowa Finance Authority has created programs for first-time homebuyers.

Iowa Finance Authority first-time homebuyer programs

There are three main programs offered by the Iowa Finance Authority. Any of these grants can help Iowans secure their own house. But you have to understand that you need to work with your local participating lender in order to utilize any of these grants.

1. First Home Program

The FirstHome Program provides first-time home buyers the opportunity for down payment assistance. This program provides homebuyers with a $2,500 grant to help with down payment and closing costs. Although the amount of down payment required is still determined by the type of loan you applied for, the availability of these down payments and closing cost assistance programs for first-time homebuyers is a huge help for covering up-front expenses.

FirstHome Eligibility Requirements

Household Income Limit:

The median household income for up to two people varies by county and is between $79,500 and $99,700.

Home Purchase Price Limit

If the home is in one of the targeted areas, up to $381,000.

Real Estate History

A first-time homebuyer must meet one of these three:

  • Applicants must be first-time homebuyers. If you haven’t owned a primary residence for three years, you’re considered a first-time homebuyer
  • A discharge other than dishonorable is required, as well as not having previously utilized a mortgage revenue bond program such as FirstHome. (only applies to Veterans)
  • Purchase a home in a Targeted Area

Occupancy

Within sixty days of closing, the buyer must move into the home as their primary residence.

Credit Score

A minimum credit score of 640 is required for all loans. Non-traditional credit documentation is allowed for borrowers with no credit score if the agency guidelines for the loan type allow it.

Debt-to-Income Ratio

Debt-to-income ratios up to 45% are allowed.    

2. Homes For Iowans

The Homes for Iowans Program is available not only for first-time homebuyers but also for repeat home buyers to purchase a home in Iowa. If you are within the income limit ($139,580) stated on the program’s eligibility requirements, you can still get a $2500 Homes for Iowans grant.

Homes for Iowans: Eligibility Requirements

Household Income Limit

$139,580

Home Purchase Price Limit

$381,000

Real Estate History

Purchasers of Iowan Homes may be both first-time buyers and repeat homebuyers.

Occupancy

Within sixty days of closing, the buyer must move into the home as their primary residence.

Credit Score

A minimum credit score of 640 is required for all loans. Non-traditional credit documentation is allowed for borrowers with no credit score if the agency guidelines for the loan type allow it.

Debt-to-Income Ratio

Debt-to-income ratios up to 45% are allowed.

Happy Us Army Soldier Smiling New Home

3. Military Homeownership Assistance Program

Military Veterans and service members can get up to $5,000 if they qualify for this grant. The good thing about this program is that the funds can be used in conjunction with the FirstHome and Homes for Iowans programs. Service eligibility requires veterans to have a minimum of 90 days of active duty between August 2, 1990, and April 6, 1991, or September 11, 2001, to present. A surviving spouse of an eligible service person can also qualify for this grant.

Iowa Down Payment Assistance

IFA FirstHome and Homes for Iowans DPA

FirstHome or Homes for Iowans grant

Up to $2,500

FirstHome or Homes for Iowans second mortgage

You can get up to $5,000 or 5% of the purchase price, whichever is less. If you refinance, pay off 1st mortgage or sell your home, this loan must be repaid in full.

The down payment assistance options from FirstHome and Homes for Iowans cannot be combined.

IFA Military Homeownership Assistance Program

To assist servicemembers, veterans, and surviving spouses with the down payment and closing costs, IFA offers the Military Homeownership Assistance Program on either the FirstHome or Homes for Iowans mortgages. Participants will receive a $5,000 grant.

IFA Military Assistance Program Requirements:

  • Approval required before closing
  • The lender must be approved by the IFA
  • You must be purchasing a single-family home, condominium, townhome, or four-unit home as your primary residence

However, these funds may be limited, so check with a loan officer to see what’s available at the present time.

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