Mortgage in Iowa
Iowa is a beautiful state. With plenty of farmland, ample housing to raise a family, and fun outdoor attractions, Iowa has seen steady population growth in recent years. It's also one of the more affordable states. With an average home value of about $155,000 , buying a home is much more straightforward in Iowa than in the coastal states. Use our Iowa mortgage calculator to see how much you'll pay for housing.
Mortgage Options in Iowa
The Hawkeye State has plenty of affordable homes. If you're moving to Iowa, you can choose from three primary mortgage types.
- Iowa conventional mortgage: Because housing costs in Iowa are lower than in other states, many people buy properties with a dollar value low enough to qualify for a conforming, non-jumbo loan. These loans require as little as 3% down, a 620 credit score, and a debt-to-income ratio of 50% or lower.
- Iowa FHA mortgage: Many Iowans find an FHA mortgage to be the perfect fit. It requires as little as 3.5% down as long as you have a 580 credit score. If your score is between 500 and 579, you'll need 10% down. You must pay private mortgage insurance for the life of the loan.
- Iowa VA mortgage: Through the VA, veterans can access a fantastic mortgage program. This program offers loans with as little as 0% down and no mortgage insurance. The only catch is that you'll likely need a credit score of 660 or above for approval.
Beyond these mortgages, Iowa also has programs to help first-time homebuyers with their down payment.
First-Time Home Buyer Programs in Iowa
The Iowa Finance Authority offers three programs to help Iowans with the cost of housing.
The FirstHome program provides one of two choices. Homebuyers can take a $2,500 grant to help with closing costs and the down payment. Or, buyers can get a second loan of 5% of the sales price up to a maximum of $5,000. It's a deferred loan, so it only comes due on sale, refinance, or when the homeowner fully pays the first mortgage.
Eligibility Criteria: Income and purchase price limits apply. The home must be the borrower's primary residence. A credit score of 640 or above is necessary.
The Homes for Iowans program gives homebuyers two choices: a $2,500 grant or a second loan of 5% of the purchase price up to a maximum of $5,000. Note that you cannot combine Homes for Iowans and FirstHome grants and loans.
Eligibility Criteria: Income and purchase price limits apply to this program. The home must be the borrower's primary residence, and the borrower must have a credit score of at least 640.
Military Homeownership Assistance Program
The Military Homeownership Assistance Program provides an additional $5,000 grant to eligible service members and veterans for down payments and closing costs. Borrowers can use this program in conjunction with one of the two above.
Eligibility Criteria: The same criteria apply as for the other two programs. You must also be a service member or veteran!
Iowa Mortgage Calculator: Homeownership Is Possible!
If you're looking to move to Iowa, you'll likely find housing to be pleasantly affordable. And thanks to some generous programs offered by the state, coming up with a down payment might be easier than you think! Review the programs and mortgage types, then see what works using our Iowa mortgage calculator.
