Through the Iowa Finance Authority, eligible applicants can receive down payment assistance in the form of either a grant or a loan (but not both). Those who receive the grant can access $2,500 to help pay for the down payment or closing. Those who receive the loan can access as much as 5% of the purchase price of the house, but no more than $5,000. This loan does not have any required monthly payments, but must be paid back when the property is sold, refinanced, or when the first mortgage is paid off.
Applicants must meet certain household income limits, which depend on county and household size. The maximum purchase price allowed is $283,000, or $346,000 in specified target areas.
In order to access the FirstHome program, an applicant must be either a first time homebuyer (not have owned a house in the previous three years), a military member with a discharge other than dishonorable (can’t have used a mortgage revenue bond program previously), or be purchasing a house in a specified target area.
Within sixty days of closing, the applicant must be using the property as their primary residence.
The minimum allowed credit score is 640 and the maximum allowed debt-to-income ratio is 45%. In the event where a borrower does not have a credit history, non-traditional credit documentation may be allowed.
Other programs in Iowa:
- Home$tart and Home$tart Plus Programs
- Military Homeownership Assistance Program
- Waterloo Down Payment Assistance Program
- Dubuque First-Time Homebuyer Loan Program
- Cedar Rapids First Time Home Buyer Program