Down Payment Assistance

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The City of Iowa City, GreenState Credit Union, and Hills Bank are partnering to increase homeownership opportunities for households that do not meet traditional financial parameters in an effort to close the racial homeownership gap in Iowa City.

GreenState Credit Union and Hills Bank will provide financing for underserved neighborhoods and households that have experienced difficulty obtaining a standard 30-year mortgage. They will offer flexibility in credit, assets, and job tenure in consideration of mortgage approval. Potential buyers will receive homebuyer education and financial counseling through Horizons at no cost.

The City of Iowa City will provide up to $24,999 in down payment assistance for eligible homebuyers using federal CDBG/HOME funds.

Buyer Eligibility

  1. Household income must be under 80% of the Area Median Income to qualify for down payment assistance. This amount is based on household size and includes income for anyone who will live in the purchased home.

    Maximum Household Income (Effective June 15, 2023)
    • 1-person household: $64,650
    • 2-person household: $73,850
    • 3-person household: $83,100
    • 4-person household: $92,300
    • 5-person household: $99,700
    • 6-person household: $107,100

  2. Buyer must qualify for financing through GreenState or Hills for the cost of the home not covered by the City's down payment assistance.
  3. All participants must complete a HUD-approved homebuyer education course. 
  4. Buyers must contribute a minimum of $250 of their own funds for down payment or closing costs and show two months of housing payments in reserves (savings that will be available after the closing in case of emergency).

Property Eligibility

  • Purchased homes must be located within the City of Iowa City municipal boundaries and out of the flood plain. 
  • Single family and condo units are eligible. Mobile home purchases are not eligible.
  • The purchase price of the home cannot exceed $271,000.
  • Properties cannot be located within a 100-year floodplain. City staff will complete an environmental review for each home prior to closing.
  • Homes must pass a Housing Quality Standards (HQS) inspection and the property must be in compliance with federal lead regulations prior to the closing.
  • Homes must be owner-occupied or vacant (not a current rental property with tenants) prior to purchase.

Down Payment Assistance

Up to $24,999 will be provided to eligible homebuyers. The actual amount of assistance will be based on underwriting.

Down payment assistance is provided as a 10-year forgivable loan. If you live in the home for ten years, the loan will be forgiven. If you sell or rent out your home within the ten year compliance period you would have to repay a pro-rated amount of the assistance.

How to Get Started

  1. Complete a mortgage application with GreenState Credit Union or Hills Bank. Work with a local GreenState or Hills Bank lender to obtain a mortgage pre-approval letter.

    GreenState Credit Union Lender Contact by Location
    • 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 - Jessica Campbell (319) 248-7175
    • GreenState Area Lenders


    Hills Bank Lender Contact by Location


  2. Complete the HUD-required homebuyer education course through Horizons. GreenState or Hills will cover any costs associated with homebuyer education:
  3. Once you have been pre-approved by your lender, you can apply for down payment assistance through the City of Iowa City. Applications will be accepted on a first come, first serve basis while funds are available. Once approved for downpayment assistance, the City will issue a Pre-qualification Letter.


Online Application for Down Payment Assistance

Submit the completed application to:

Walt McFadden
Housing Rehab
City of Iowa City
410 E. Washington St
Iowa City, IA 52240

If you have questions, contact Walt McFadden:, 319-356-5129 (8am-12pm).

Next Steps

  1. Find an eligible home to purchase and make an offer.
  2. Complete required home inspections.
  3. The City and GreenState/Hills will complete the required underwriting for their respective loans.
  4. Close on your home.
  5. Keep the home as your principal residence for 10 years.