The City of Iowa City and GreenState Credit Union have partnered on an initiative that seeks to increase homeownership opportunities, according to a release.
This initiative is geared toward 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, the release states.
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. Iowa 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, according to the release.
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. This amount is based on household size and includes income for anyone who will live in the purchased home.
The City’s website lists Maximum Household Income as such:
- 1-person household: $55,850
- 2-person household: $63,800
- 3-person household: $71,800
- 4-person household: $79,750
- 5-person household: $86,150
- 6 person household: $92,550
These are affective as of June 1, 2021, according to the website.
Buyers must also qualify for financing through GreenState Credit Union 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, although mobile homes are not, and 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 Credit Union.
The release provided contact information for lenders familiar with the program:
- 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 Credit Union 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.
