October 20, 2022

IFA Loans & Down Payment Assistance

Iowa Finance Authority offers several mortgage programs to help with down payment and closing cost expenses. The dream of owning your own home is within reach. First-time homebuyers, experienced buyers and everyone in between can make use of the programs.

FirstHome Program

The FirstHome Program is specifically designed to assist first-time homebuyers.

Benefits:

  • Interest Rates are typically lower than the market rate and have fewer fees. Credit score does not affect the interest rate.
  • Down Payment is determined by loan type. Loans may require only 3% down payment and may include reduced mortgage insurance coverage. Down payment and closing cost assistance programs are available to help cover upfront expenses.
  • Free Iowa Title Guaranty Owner’s Certificate.

Eligibility Requirements:

  • Household Income Limit varies by county and ranges from $86,900 to $109,000.
  • Home Purchase Price Limit $349,000 may be up to $427,000 in targeted areas.
  • Real Estate History – must be a first-time homebuyer not owning a primary residence in the last three years OR be a military member with discharge of other than dishonorable and not previously used a mortgage revenue bond program such as FirstHome to finance or purchase a home OR purchase a home in a Targeted Area.
  • Occupancy – the home must be occupied by the buyer as a primary residence within 60 days of closing.
  • Credit Score must be a minimum of 640.
  • Debt-to-Income Ratio maximum 45%.
  • Homebuyer Education is required on conventional loans.

Homes for Iowans Program

No matter how many homes you’ve purchased, you may qualify for the Homes for Iowans Program.

Benefits:

  • Interest Rates are typically lower than the market rate and have fewer fees. Credit score does not affect the interest rate.
  • Down Payment is determined by loan type. Loans may require only 3% down payment and may include reduced mortgage insurance coverage. Down payment and closing cost assistance programs are available to help cover upfront expenses.
  • Free Iowa Title Guaranty Owner’s Certificate.

Eligibility Requirements:

  • Household Income Limit - $152,600.
  • Home Purchase Price Limit - $427,000.
  • Real Estate History – available to first-time and repeat homebuyers who are purchasing a primary residence in Iowa.
  • Credit Score minimum 640.
  • Debt-to-Income Ratio maximum 45%.
  • Homebuyer Education is required on conventional loans.

Down Payment and Closing Cost Programs

FirstHome program can either give you:

  • A down payment and closing cost assistance grant OR a 2nd Loan program loan, not both
    • Grant – The down payment and closing costs assistance grant provides homebuyers with a $2,500 grant to assist with down payment and closing costs.
    • Loan – The 2nd Loan program offers a loan of up to 5% of the home’s sale price or $5,000 (whichever is less) and is repayable at the time of sale, refinance or first mortgage is paid in full. No monthly payment required!
  • Eligibility:
    • Household Income Limit - $86,900 to $109,000.
    • Home Purchase Price Limit - $349,000 up to $427,000 in targeted areas.
    • Real Estate History – must be a first-time homebuyer not owning a primary residence in the last three years OR be a military member with discharge of other than dishonorable and not previously used a mortgage revenue bond program such as FirstHome to finance or purchase a home OR purchase a home in a Targeted Area.
    • Occupancy – the home must be occupied by the buyer as a primary residence within 60 days of closing.
    • Credit Score must be a minimum of 640.
    • Debt-to-Income Ratio maximum 45%.

Homes for Iowans program can either give you:

  • A down payment and closing cost assistance grant OR a 2nd Loan program loan, not both
    • Grant – The down payment and closing costs assistance grant provides homebuyers with a $2,500 grant to assist with down payment and closing costs.
    • Loan – The 2nd Loan program offers a loan of up to 5% of the home’s sale price or $5,000 (whichever is less) and is repayable at the time of sale, refinance or first mortgage is paid in full. No monthly payment required!
  • Eligibility:
    • Household Income Limit - $152,600.
    • Home Purchase Price Limit - $427,000.
    • Real Estate History – available to first-time and repeat homebuyers who are purchasing a primary residence in Iowa.
    • Occupancy – the home must be occupied by the buyer as a primary residence within 60 days of closing.
    • Credit Score minimum 640.
    • Debt-to-Income Ratio maximum 45%.

Military Homeownership Assistance Program

The Military Homeownership Assistance Program provides a $5,000 grant to eligible service members and veterans for down payments and closing costs on qualifying homes. The funds may be used in conjunction with the FirstHome and Homes for Iowans programs.

  • Eligibility:
    • Service – served 90 days active duty between August 2, 1990, and April 6, 1991, or September 11, 2001 to present.
    • Or is a federal status injured service person in active-duty August 2, 1990, or September 11, 2001, to present.
    • Or is a surviving spouse of said eligible service person who has been discharged other than dishonorable.