Iowa Homes for Iowans Program

The Iowa Homes for Iowans Program, administered by the Iowa Finance Authority (IFA), is designed to help eligible homebuyers purchase homes by offering affordable mortgage options and financial assistance for upfront costs. This program is open to a broad range of buyers, making homeownership achievable for more residents across Iowa.

Benefits

Provides 30-year fixed-rate mortgages with competitive interest rates for consistent and manageable monthly payments.
Offers down payment and closing cost assistance to reduce the initial financial burden of buying a home.
Assistance is available in the form of a grant or a low-interest second mortgage, depending on eligibility and program terms.
Available to both first-time homebuyers and repeat buyers who meet the program’s criteria.
Supports purchases of single-family homes, condominiums, and manufactured homes on a permanent foundation.

Eligibility Requirements

Applicants must meet income limits, which vary based on household size and the property’s location within Iowa.
The property must be located in Iowa and used as the buyer’s primary residence.
A minimum credit score of 640 is generally required, though lender-specific underwriting standards may also apply.
Participants must complete a homebuyer education course to prepare for the responsibilities of homeownership.
Debt-to-income ratios must meet program guidelines to ensure financial readiness.

Additional Information

The Iowa Homes for Iowans Program is a vital initiative that helps residents overcome financial barriers to purchasing a home. By offering affordable mortgage options and assistance for upfront costs, the program enables individuals and families to achieve stability and build equity in their future. Administered by the Iowa Finance Authority, the program supports sustainable housing solutions while strengthening communities throughout Iowa.

Frequently Asked Questions About Our Program

What is the Iowa Homes for Iowans Program?

The Iowa Homes for Iowans Program, offered by the Iowa Finance Authority (IFA), provides affordable mortgage options to both first-time and repeat homebuyers purchasing a primary residence in Iowa. The program aims to make homeownership more accessible by offering competitive interest rates and down payment assistance.

Who is eligible for the Homes for Iowans Program?

Eligibility extends to both first-time and repeat homebuyers who are purchasing a primary residence in Iowa. Applicants must meet specific income and purchase price limits, which vary by county and household size. A minimum credit score of 640 is required, and the maximum debt-to-income ratio is 50% with an automated underwriting approval; manual underwriting remains at 45%.

What types of properties are eligible under the Homes for Iowans Program?

Eligible properties include single-family homes, townhomes, and condominiums that will serve as the borrower's primary residence. The property must meet purchase price limits set by the program.

Are there income and purchase price limits for the Homes for Iowans Program?

Yes, the program has specific income and purchase price limits that vary by county and household size. For example, as of 2025, the household income limit is $163,800, and the home purchase price limit is $624,000.

Is homebuyer education required for the Homes for Iowans Program?

Homebuyer education is required on conventional loans only. If all borrowers are first-time homebuyers, then only one of the borrowers must complete the course. This requirement ensures that buyers are well-prepared for the responsibilities of homeownership.

What down payment assistance options are available with the Homes for Iowans Program?

The program offers a 2nd Loan option, which provides a loan of up to 5% of the home's sale price with no maximum. This loan is repayable at the time of sale, refinance, or when the first mortgage is paid in full, with no monthly payments required.

Can the Homes for Iowans Program be combined with other assistance programs?

Yes, the Homes for Iowans Program can be combined with other down payment and closing cost assistance programs, such as the Military Homeownership Assistance Program, which provides a $5,000 grant to eligible service members and veterans.

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Is there a recapture tax associated with the Homes for Iowans Program?

Borrowers who use the Homes for Iowans Program may be subject to a federal recapture tax if they sell their home within nine years, experience a significant increase in income, and have a gain on the sale. However, if required to pay the recapture tax, IFA will reimburse the actual amount paid to the IRS.

What types of mortgage loans are available through the Homes for Iowans Program?

The program offers various loan options, including conventional, FHA, VA, and USDA loans, providing flexibility to suit different borrower needs.

Is mortgage insurance required with the Homes for Iowans Program?

Mortgage insurance requirements depend on the type of first mortgage loan selected. For instance, conventional loans with less than a 20% down payment typically require private mortgage insurance (PMI).

Can the Homes for Iowans Program be used for new construction homes?

Yes, the program can be applied to both newly constructed and existing homes, provided all other program criteria are met.

Are there occupancy requirements for the Homes for Iowans Program?

Yes, the property purchased must be occupied as the borrower's primary residence within 60 days of closing and throughout the term of the mortgage.

Is there a prepayment penalty for loans under the Homes for Iowans Program?

No, there is no prepayment penalty. Borrowers can pay off their mortgage early without incurring additional fees.

What documentation is required to apply for the Homes for Iowans Program?

Applicants will need to provide proof of income, employment, credit history, and, if applicable, completion of the required homebuyer education course, among other standard loan application documents.

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Are there any fees associated with the Homes for Iowans Program?

Standard loan fees, such as origination and processing fees, may apply. It's important to discuss all potential fees with your lender to understand the total cost of the loan.

Is the Homes for Iowans Program available statewide?

Yes, the Homes for Iowans Program is available throughout Iowa, but income and purchase price limits vary by location.

Can the Homes for Iowans Program assist with closing costs?

Yes, the down payment assistance options available through the Homes for Iowans Program can be used to cover both down payment and closing costs, helping to reduce the upfront expenses of purchasing a home.

What is the process to apply for the Homes for Iowans Program?

To apply, borrowers should contact an IFA-approved lender who will guide them through the application process, including verifying eligibility, assisting with necessary documentation, and explaining program requirements.

Are there specific credit score and debt-to-income ratio requirements for the Homes for Iowans Program?

Yes, applicants must have a minimum credit score of 640. The maximum debt-to-income ratio is 50% with an automated underwriting approval; manual underwriting remains at 45%.

Are there any post-purchase requirements for the Homes for Iowans Program?

While there are no specific post-purchase requirements, borrowers are encouraged to maintain their home and finances responsibly to ensure successful long-term homeownership.