First-time home buyer programs in Iowa and Des Moines

Which IFA programs are there?

You apply for all of them through an IFA participating lender, not directly to IFA.

Source: Iowa Finance Authority, 2026 Homeownership Program Income and Purchase Price Limits (effective June 9, 2026), and program pages.

Both mortgage programs share these rules, according to IFA:

• The home must be your primary residence within 60 days of closing.
• New purchases only, no refinances, with 25-year or 30-year terms.
• Minimum credit score of 640.
• Maximum debt-to-income ratio of 50% for loans approved by automated underwriting (45% for manual underwriting).
• Homebuyer education is required for all borrowers.
• You can ask for a free Iowa Title Guaranty owner’s certificate at closing. See our page on title insurance in Iowa.

How much down payment help is there?

IFA’s down payment page describes two options for FirstHome buyers: a $2,500 grant, or a second loan of up to 5% of the sale price or appraised value (whichever is lower). You get one or the other, not both. Homes for Iowans offers only the second loan. The second loan has no monthly payments. It is repaid when you sell, refinance or pay off the first mortgage, and subordination is not permitted.

Change on November 2, 2026. IFA announced on September 17, 2026 that, for loan reservations made on or after November 2, 2026:

The Plus grant will no longer be available for new reservations from that date. IFA’s page was still showing the current rules when we read it on October 13, 2026, so ask your lender which version applies to your reservation date.

Examples

At the 2024 Des Moines median value of $213,300 (see Iowa home prices), and for illustration only:

• 5% second loan: about $10,665, below the $15,000 cap that applies from November 2, 2026.
• 3% second mortgage: about $6,399, below the $10,000 cap.

Veterans can add the Military Homeownership Assistance Program, a $5,000 grant for down payment and closing costs. IFA’s example combines a $5,000 second loan with it for $10,000 in total help. IFA reported on October 1, 2026 that $1,305,000 remained for the fiscal year, and the program is limited to available funding. You need approval before closing.

What about the federal tax credit?

IFA’s Mortgage Credit Certificate (MCC) program can cut a buyer’s federal income tax by 50% of the mortgage interest paid each year, up to $2,000 a year. IFA’s page states that no funding is currently available for new certificates.

Recapture tax

Buyers who use FirstHome, FirstHome Plus or the second loan may owe a federal recapture tax if they sell within nine years at a gain and their income has risen enough. IFA says that for loans closed on or after November 14, 2011, it reimburses the actual recapture tax paid to the IRS. Ask a tax professional about your case.

Programs in Des Moines

• Targeted areas. IFA lists seven targeted census tracts in Polk County (3, 11, 17, 21, 48, 50 and 52). If your home is in one, FirstHome limits rise to $139,680 (one or two people) or $162,960 (three or more) and the price limit to $692,000, and the first-time buyer rule does not apply. Use IFA’s Eligibility Quick Check to test an address.
• City funding. The City of Des Moines says its homebuyer funding goes through its nonprofit partners, not directly to buyers. Contact the City’s Federal Funds office at (515) 283-4520 for the current list.
• Section 32 Homeownership. The Des Moines Municipal Housing Agency sells homes at 67% of market value with a five-year, interest-free forgivable loan for the other 33%. As of October 13, 2026, it sells only to eligible public housing residents and Section 8 participants. Income must be below 80% of area median income.
• Housing counseling. The agency is a HUD-approved counseling agency and offers pre-purchase workshops and a Pre-Purchase Home Buyer Course certificate.

How to apply

1. Find an IFA participating lender through IFA’s lender search.
2. The lender checks your eligibility and underwrites the loan.
3. Finish the homebuyer education course.
4. Reserve the loan and close. Read our home buying steps for the full process.