Single-Family New Construction Down Payment
The North Iowa Area Council of Governments is
offering down payment assistance of up to 25% of
the purchase price of 101 newly constructed homes
in the North Iowa area including sites in the
following communities: Charles City,
Forest City, Hampton, Mason City, Northwood,
Riceville, St. Ansgar, and Stacyville.
You can find a specific
list of site locations, prices, and home designs
here. This assistance is offered in the form
of a 5-year, forgivable loan which will be used to
buy down the amount that you borrow for the home.
The forgivable loan works like a grant in that it
does not need to be paid back except if the
property is sold, rented or vacated within 5 years
after closing. For a brochure please
download and print here. Click Here
2. You and your household MUST meet the income
guidelines below which are based on the number
of persons in your household (as set by the
Department of Housing and Urban Development each
County Of New home
The remaining Floyd
County (as shown above) and
Riceville (20% less than the Mitchell County
limit) project are subject to a
limit that is 20% less than the median income
because of the rules for the
round in which their projects were added.
3. You MUST obtain your home loan from a lender
that has been approved for the program. Approved
banks include: Iowa Heartland Community Credit
Union, North Iowa Community Credit Union,
Northwood State Bank, Manufacturers State Bank
(MBT), Liberty Bank, St. Ansgar State Bank,
First Citizens National Bank, Cresco Union
Savings Bank (CUSB), Home Trust & Savings
Bank, First Security, Clear Lake Bank &
Trust Co., and Habitat For Humanity. The home
loan obtained must be at least a 15-year,
fixed-rate fully amortized loan with early
pay-off allowed. Co-signers are allowed,
but they cannot be included on the deed as an
owner. The loan must be between 50% and
75% of the home's purchase price. You will
need to pay the closing costs out of pocket
because they cannot be included in the loan;
these include the cost for the bank to make the
loan, the appraisal, legal work, etc.
4. You must be prepared to close on the home at
the time required by the seller after issuance
of a certificate of occupancy.
5. If you are approved for the program and agree
to purchase one of the participating properties,
the program will pay 25% of the purchase price
of the home at the closing. You will need to pay
the closing costs.
6. The assistance will be paid in the form of a
5-year forgivable loan, and a lien will be
placed on the property. The lien will provide
that 20% of the original loan balance will be
forgiven each year for 5 years. After 5 years,
the loan is fully forgiven, and the lien can be
removed from the property. You may sell the home
during the 5-year period, but the remaining
balance of the loan must be repaid to NIACOG.
7. The home must be your primary residence
during the five-year period. This is not a
first time homebuyer program, and people who
currently own a home are not precluded from
participating in this program; however, the
current home must be sold or otherwise disposed
of as a residence for the applicant.
8. Assistance under this program will not be
allowed to be combined with any Federal
Jumpstart Homebuyer Assistance or State
Jumpstart Down Payment Assistance on the same
dwelling unit or person/household served.
I’M INTERESTED. WHAT DO I DO NEXT?
1. First, you will need to
submit a Homebuyer Assistance Application Form
including all attachments listed in the
application, such as a copy of your most recent
tax return, basic financial information, and a
copy of a loan preapproval letter from an
approved bank. Approved banks include: Iowa
Heartland Community Credit Union, North Iowa
Community Credit Union, Northwood State Bank,
MBT, Liberty Bank, St. Ansgar State Bank, First
Citizens National Bank, CUSB, Home Trust &
Savings Bank, First Security, Clear Lake Bank
& Trust Co., and Habitat For Humanity.
2. NIACOG will verify your eligibility and
income based on information submitted with your
application, and if you are not eligible you
will be notified immediately.
3. Information about the homes can be obtained
from the participating builders or from
HOW WILL HOMEBUYERS BE SELECTED?
1. Income will be verified
through tax and income documentation and
third-party verification to determine