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Iowa Home Buying

What are the first-time home buyer requirements in Iowa?

No main home owned in the last three years, or one of two exceptions.That is the first-time rule for Iowa's FirstHome program. If you served, your discharge was other than dishonorable, and you have not used FirstHome or a program like it before, you can skip the three-year rule. And Iowa has a grant of up to $5,000 for service members and veterans that you can use whether or not you have owned a home before.

This page shows the Iowa Finance Authority's three home buyer programs, who qualifies for the military grant, and why the home's address matters.

Iowa law and Iowa Finance Authority sourcedChecked October 2026

Start Here

What counts as a first-time buyer

For its FirstHome program, the Iowa Finance Authority (IFA) counts you as a first-time buyer if one of these is true.

  • You have not owned your main home in the last three years.
  • You served, your discharge was other than dishonorable, and you have not used FirstHome or a program like it to buy a home before.
  • You are buying in what IFA calls a targeted area. More on that below.

The second one comes from a federal tax law that lets a veteran skip the three-year rule once. Ask an IFA lender whether your service counts.

Owned a home recently? IFA's Homes for Iowans program is open to first-time and repeat buyers.

Sources: IFA, FirstHome Program. IFA, Program Eligibility (its questions and answers). 26 U.S. Code 143(d). IFA, Homes for Iowans. All retrieved 15 October 2026.

The Programs

IFA's three home buyer programs

IFA runs all three. You apply through a lender that takes part in IFA's programs, not through IFA itself.

01

FirstHome: for first-time buyers

First-time as defined above. Its income limit depends on your county and household size. You can add IFA's help with the down payment and closing costs.

02

Homes for Iowans: for first-time and repeat buyers

One income limit and one price limit for the whole state. You can add the same down payment help.

03

Military Homeownership Assistance: for service members and veterans

Up to $5,000 toward the down payment and closing costs. You can use it with FirstHome or Homes for Iowans. Each eligible person gets it once, and it depends on the money the program has left. Who qualifies is in the next section.

IFA offers a second loan with no monthly payments. You pay it back when you sell, refinance or pay off your mortgage. IFA sets how much you can get and changes it, so check its down payment page.

IFA says that if you use FirstHome or its second loan and sell within nine years, you may owe the IRS part of your profit, called a recapture tax. It says it pays you back for that tax on loans closed on or after November 14, 2011.

For all three, the home has to be in Iowa, and you have to move in as your main home within 60 days of closing. FirstHome and Homes for Iowans need a homebuyer education course. IFA says its programs can be used with the common loan types, including a VA home loan, the one backed by the U.S. Department of Veterans Affairs (VA).

IFA posts each year's income and price limits in one table. They change, so check the current one.

Sources: IFA, Homeownership. IFA, FirstHome Program. IFA, Homes for Iowans. IFA, Military Homeownership Assistance Program. IFA, Down Payment and Closing Costs Programs. IFA, Program Eligibility. Iowa Administrative Code 265, chapter 27. All retrieved 15 October 2026.

Who Qualifies

What counts for the military grant

Iowa's law covers members and former members of the National Guard, the reserves and the regular forces who served at least 90 days of active duty, either on or after September 11, 2001, or between August 2, 1990, and April 6, 1991.

IFA says the days can add up and do not have to be in a row. It also says drill, annual training, inactive duty training and active duty for training may not count. If your service is mostly drill and annual training, ask before you count on the grant.

Left the service? A discharge under honorable conditions meets Iowa's law. For any other discharge, ask. The law also covers someone discharged honorably because an injury on federal active duty in those years kept them from reaching 90 days.

The Iowa Department of Veterans Affairs has the final say on who qualifies. IFA sends it your papers, which can include your DD Form 214 showing your character of service, or recent leave and earnings statements showing 90 days of active duty.

A surviving spouse of an eligible service member can apply too, and has to meet the program's other rules.

Get approval before you close. Iowa's rules require IFA to approve the grant before closing. Once approved, it holds for 60 days for an existing home, or 120 days for one being built or renovated, while the money lasts. If your loan is delayed for reasons you cannot control, you can ask for more time.

If the money runs out during your purchase, you may be put on a waiting list. If money comes in after you close, it goes toward your loan balance. If you and your spouse both qualify, only one of you can use it on a home. IFA posts how much money is left on its program page.

This is not the test for a VA home loan. VA has its own routes for Guard members, and our Iowa National Guard guide covers them.

Sources: Iowa Code 16.54. Iowa Administrative Code 265, chapter 27 (rules 27.2 to 27.4). IFA, Military Homeownership Assistance Program. All retrieved 15 October 2026.

Where You Buy

Why the home's address matters

For FirstHome, the address can change the rules, even inside one county.

IFA lists its targeted areas by census tract, a small area on the map. In a targeted area, FirstHome's income and price limits are higher, and you do not have to be a first-time buyer.

Outside them, FirstHome's income limit depends on your county and household size. Homes for Iowans uses one limit for the whole state.

Before you make an offer, check the address with IFA's Eligibility Quick Check. And for every program on this page, the home has to be in Iowa.

Sources: IFA, 2026 Homeownership Program Income and Purchase Price Limits. IFA, FirstHome Program. IFA, Homes for Iowans. All retrieved 15 October 2026.

If You Are Still Saving

Iowa's first-time homebuyer savings account

Iowa lets you save for a first home in an account at a bank, credit union or other financial institution in Iowa, and deduct what you put in from your Iowa income, up to a yearly limit and a lifetime limit.

The money can pay the down payment and closing costs on a single-family home in Iowa that will be the main home of the person the account is for. A condo or a manufactured home counts. Iowa's law says the costs include the VA funding fee.

Its first-time rule is its own. The person the account is for has to be an Iowa resident who has not owned a home in the three years before two dates: the day they are named on the account, and the day they buy. Iowa's law for this account has no military exception.

Open it at least 90 days before you buy, and use it within 10 years. Name who it is for on Iowa Department of Revenue Form 41-162 by April 30 of the year after you open it. If the money is used for anything else, or not used for a home within 10 years, what you deducted is added back to your Iowa income, plus 10 percent, with a few exceptions the Department of Revenue lists.

Sources: Iowa Department of Revenue, First-Time Homebuyers Savings Account. Iowa Code chapter 541B. Both retrieved 15 October 2026.

Before You Buy

What to ask your lender

Ask these before you make an offer. IFA has a lender search.

  1. Do you take part in IFA's programs?
  2. Do I count as a first-time buyer for FirstHome: by the three-year rule, my service, or the home's area?
  3. Is this address in a targeted area, and what are the limits where I am buying?
  4. Can I use the military grant with my loan, and will you ask for approval before closing?
  5. Will my active duty count for the grant, or should I ask the Iowa Department of Veterans Affairs first?

This page is not legal, tax or lending advice. IFA, its lenders and the Iowa Department of Veterans Affairs decide who qualifies. Ask about your own case.

A page can explain the programs.An agent who works Central Iowa can walk a specific home with you.

Cindy Miller is a Mission Ready Operator who helps active-duty, Guard, Reserve and veteran families moving to or from Central Iowa.

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Last reviewed October 2026 · Maintained by My Military HQ

Common Questions

Questions buyers ask about Iowa's programs

What are the first-time home buyer requirements in Iowa?

For the Iowa Finance Authority's FirstHome program, you count as a first-time buyer if you have not owned your main home in the last three years. You also count if you served, your discharge was other than dishonorable, and you have not used FirstHome or a program like it to buy a home before. Or if you buy in what the Iowa Finance Authority calls a targeted area. FirstHome also has income and price limits, a homebuyer education course, and a rule that you move in within 60 days.

Do veterans count as first-time home buyers in Iowa?

For Iowa's FirstHome program, yes, in one case. The Iowa Finance Authority says a military member whose discharge was other than dishonorable can use FirstHome without meeting the three-year rule, if they have not used FirstHome or a program like it to buy a home before. Ask an Iowa Finance Authority lender whether your service counts.

Does Iowa have a home buying grant for veterans and the National Guard?

Yes. Iowa's Military Homeownership Assistance Program gives up to $5,000 toward the down payment and closing costs on a home in Iowa. It covers members, and former members discharged under honorable conditions, of the National Guard, the reserves and the regular forces with at least 90 days of active duty in the years Iowa's law names. Each eligible person gets it once, it has to be approved before closing, and it depends on the money the program has left.

Do National Guard drill weekends count toward Iowa's military home buying grant?

They may not. Iowa's grant needs at least 90 days of active duty. The Iowa Finance Authority says the days can add up, but drill, annual training, inactive duty training and active duty for training may not count. The Iowa Department of Veterans Affairs decides who qualifies.

Can I use Iowa Finance Authority programs with a VA loan?

Yes. The Iowa Finance Authority says its programs can be used with the common loan types, including a VA home loan. You apply through a lender that takes part in its programs.

What is Iowa's first-time homebuyer savings account?

It is a savings account at a bank, credit union or other financial institution in Iowa, for a first home in Iowa. Iowa lets you deduct what you put in from your Iowa income, up to a yearly and a lifetime limit. The money can pay the down payment and closing costs on a single-family home in Iowa that will be the buyer's main home, and Iowa's law says those costs include the VA funding fee. It has its own three-year first-time rule, with no military exception.

Sources

Where every fact came from

Everything on this page comes from Iowa law, federal law, or the Iowa agencies that run these programs. Where they do not say something, we left it out.

What we left out on purpose. We give no income or price limit figures, no down payment help amounts and no savings account deduction amounts, because they change; we link IFA's and the Department of Revenue's pages. We do not say how much grant money is left, because it changes; IFA posts it. We give no interest rates, credit score or debt rules, because those belong to your lender. We do not list targeted areas, because the address decides. We do not say which Guard orders count for the military grant, because no source we read says; the Iowa Department of Veterans Affairs decides. And we cover only Iowa's state programs: ask your city or county whether it runs its own.

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