Iowa Mortgage Guide 2026
Loan limits, loan programs, Iowa Finance Authority mortgages, property taxes and closing costs — everything an Iowa buyer needs in one place.
Iowa loan limits by county
Every one of Iowa’s 99 counties carries the same 2026 FHA limit and the same conforming limit — there is not a single high-cost county in the state, so the figure in Sioux City is the figure in Davenport is the figure in Des Moines.
| Property type | FHA limit (2026) | Conforming limit (2026) |
|---|---|---|
| One-family | $541,287 | $832,750 |
| Two-family | $693,050 | $1,066,250 |
| Three-family | $837,700 | $1,288,800 |
| Four-family | $1,041,125 | $1,601,750 |
HUD sets FHA limits from local median home prices, with a national floor and ceiling. Because Iowa home prices sit below the threshold where the calculated limit would rise, all 99 counties land on the national floor. Verify any county at the HUD FHA mortgage limits lookup or the FHFA conforming loan limit page.
Loan programs available in Iowa
Iowa buyers use the same four core loan programs available nationally. The down payment and credit score figures below are practical lender thresholds rather than published agency minimums, and they are the same in every state.
| Program | Min Down Payment | Min Credit Score | Best For |
|---|---|---|---|
| FHA | 3.5% | 580 | Buyers with limited savings or thinner credit files |
| VA | 0% | No VA minimum (set by lender) | Eligible veterans, service members and surviving spouses |
| USDA | 0% | No USDA minimum | Buyers in Iowa’s eligible rural areas within income limits |
| Conventional | 3–20% | Set by lender | Buyers with stronger credit who want to avoid FHA mortgage insurance |
USDA publishes no program minimum credit score — the 640 figure is the threshold used by its automated underwriting system and by most lenders. VA publishes no minimum score at all.
Iowa Finance Authority mortgage programs
The Iowa Finance Authority (IFA) runs two first-mortgage programs, and which one applies to you depends mainly on whether you have owned a home in the last three years.
| Program | Income limit | Purchase price limit | First-time buyer required |
|---|---|---|---|
| FirstHome | $102,100–$171,360, varies by county and household size | $566,000 (up to $692,000 in targeted areas) | Yes — waived for eligible military or targeted areas |
| Homes for Iowans | $171,360 | $692,000 | No |
Both require a minimum 640 credit score, are limited to new purchases in 25- or 30-year terms, and cap debt-to-income at 50%. Assistance comes in three forms: a $2,500 FirstHome grant, a $5,000 Military Homeownership grant for eligible service members and veterans, and a 2nd Loan of up to 5% of the sale price or appraised value. FirstHome buyers choose the grant or the 2nd Loan, not both; Homes for Iowans offers the 2nd Loan only.
The 2nd Loan is not a grant. It carries no monthly payment, which makes it feel like free money, but the balance is due in full when you sell, refinance, or pay off the first mortgage. The two grants are genuinely forgiven; the 2nd Loan is not.
Full program terms are published by the Iowa Finance Authority.
Iowa property taxes
Iowa’s property tax system has an extra step, and it changes what the headline rate means. You are not taxed on your home’s full market value — you are taxed on a percentage of it, set annually by the Department of Revenue and called the rollback.
| Measure | Figure | What it measures |
|---|---|---|
| Estimated effective rate | 1.39% | Median real estate taxes paid divided by median home value, owner-occupied units |
| Average consolidated levy | $32.41 per $1,000 | Statewide FY2026 levy against taxable value, after the rollback |
| Residential rollback | 44.5345% | Share of market value that becomes taxable value, assessment year 2025 |
County averages vary widely — Decatur County averages $20.04 per $1,000 while Dubuque County averages $39.20. The assessment cycle runs about eighteen months: your assessor sets value on January 1, the first half payment comes due the following fall, and the second half the spring after that. Mechanics are explained by the Iowa Department of Revenue.
Iowa closing costs
Iowa closings are unusual in two ways, and both work in the buyer’s favour.
First, the transfer tax is modest and lands on the deed only: $0.80 for each $500 of price above the first $500, under Iowa Code 428A.1. Mortgages are expressly exempt, so there is no transfer tax on the mortgage.
Second, Iowa does not use private title insurance. Iowa Code 515.48(10) excludes title insurance from the lines insurers may write in the state, and Iowa Code 16.91 puts a state-run alternative in its place: Iowa Title Guaranty, operated by the Iowa Finance Authority. An owner or lender certificate costs $175 for coverage up to $750,000, with the closing protection letter included at no additional premium.
Recording fees are set by statute and identical in every county: $5.00 per page, plus $1.00 records management and $1.00 land record system per transaction.
Iowa housing market overview
Iowa’s housing market is best understood as several distinct local markets rather than one statewide one. The table below describes each area qualitatively.
| Area | Market notes |
|---|---|
| Des Moines–West Des Moines | The state’s largest metro and its main job engine, covering Polk, Dallas, Warren, Madison, Guthrie and Jasper counties. |
| Cedar Rapids and Iowa City | Two adjacent metros with different characters — Cedar Rapids industrial and Iowa City driven by the university and medical centre. Iowa City carries higher USDA income limits than the state base. |
| Quad Cities and eastern Iowa | Scott County anchors a bi-state metro with Illinois. Dubuque and Clinton serve the Mississippi river corridor. |
| Western Iowa | Sioux City in the north-west and the Council Bluffs area, which sits inside the Omaha metro and carries Omaha’s higher USDA income limits. |
| Rural and small-metro Iowa | The large majority of Iowa’s 99 counties. Most are USDA-eligible and most sit at the base income limit, making no-down-payment financing broadly available. |
