The City of Iowa City and GreenState Credit Union have partnered on an initiative that seeks to increase homeownership opportunities for community members who do not meet traditional financial parameters necessary to secure a mortgage. The goal of the partnership is to decrease racial gaps in homeownership within Iowa City.

Under the partnership, GreenState will provided financing for underserved neighborhoods and households that have experienced difficulty in obtaining a standard 30-year mortgage. GreenState will be flexible when considering credit, assets, and job tenure in weighing mortgage approval. The City will provide up to $15,000 in down payment assistance using federal CDBG/HOME funds for eligible homeowners.

Potential buyers will also receive homebuyer education and financial counseling through Horizons at no additional cost.

Eligibility

In order to qualify for down payment assistance, the household income of the buyers must be below 80 percent of the Area Median Income. Buyers must also qualify for financing through GreenState for the cost of the home not covered by the City's down payment assistance. 

Eligible homes must be located within the City of Iowa City municipal boundaries and within a low-income census tract. Single family homes and condominium units are eligible under the program; however, mobile homes are not. The purchase price of the home cannot exceed $247,000.

Additional eligibility criteria and a census tract map can be found here.

How to apply

Interested potential buyers must first complete a mortgage application with GreenState. Lenders familiar with the program - along with their respective branches - are:

Downtown Iowa Avenue - Pete Johnson 319-341-2213 

Eastside Iowa City - Sara Marshall 319-248-7182 

Westside Iowa City - Sean Pottratz 319-248-7128 

Coralville – Matt Frascht 319-341-3062 

North Liberty Penn St – Eric Baumgarth 319-341-3070 

North Liberty Financial Center – Tami McGary 319-341-2126 

Buyers will then need to complete the HUD-required homebuyer education course offered through Horizons. Any costs associated with the course will be covered by GreenState. 

Once buyers have been pre-approved by GreenState and have completed the homebuyer education course, they can apply for City down payment assistance here.

The buyer would then need to find a home that meets eligibility requirements, make an offer, complete the required home inspections, and close on the offer. The down payment assistance funds will be forgiven if the buy keeps the home as their principal residence for 10 years.

Date of publication

Wednesday, April 20, 2022

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