The Iowa legislature created the Military Service Member Homeownership Assistance Program in 2005 to help eligible members of the armed forces of the purchase qualified homes in Iowa through matching grants. A grant under the Program is a dollar-for-dollar match of the service member’s contribution, up to $5,000. The Program is administered by the Iowa Finance Authority.

Eligible home buyers
The program is available to service members who:
At the time of applying for a grant under the program, have served on active duty in a Title 10, United States Code, active federal military service status for at least 90 days cumulative, other than training, during the period beginning September 11, 2001, and ending June 30, 2008, as a member of the national guard, reserve, or regular component of the armed forces of the United States;

• Purchase a qualifying home;
• Utilize a participating lender (if financing the purchase); and
• Contribute a matching cash amount to the purchase (up to $5,000).

The Program is also available to surviving spouses of deceased eligible service members who meet the other eligibility requirements. There are no income or purchase price limits, and grants awarded under the Program may be used in conjunction with other assistance available through FHA, VA, USDA, IFA, or other programs if the eligible service member qualifies for those programs.

Eligible homes
A home is eligible under the Program if it:

1. Is located in the state of Iowa
2. Is purchased by an eligible service member as the service member’s primary residence on or after March 10, 2005; and
3. Falls into one of the following categories:
   • Single-family residences (including “stick-built” homes, modular homes, or manufactured homes, provided the home is attached to a permanent foundation and is taxed as real estate);
   • Condominiums;
   • Townhomes; or
   • Duplexes, if one of the units will be the primary residence of the service member.

The following categories of property do not qualify for the program:

• Multifamily properties;
• Commercial or nonresidential property;
• Vacation or second homes;
• Farmland or other investment property;
• Recreational vehicles, mobile homes, or trailers not attached to a permanent foundation.

Service member’s contribution
The service member’s contribution is cash the service member applies towards the purchase of the home. The following can be counted towards the service member’s contribution:

• Cash from the service member’s own savings;
• Gifts of cash from a parent or grandparent or from a legal guardian; and
• Cash grants to the eligible service member.

The following examples may not be counted towards the service member’s contribution:

• Gifts from other sources;
• Contingent grants;
• Proceeds of loans, and
• In-kind gifts may not be counted.

Participating lenders
Participating lenders are lenders who have been screened and pre-approved for participation in IFA’s FirstHome loan program. The screening process ensures that the lenders involved in the Program are legitimate, solvent, and reputable lenders. There are currently over 145 participating lenders with approximately 630 office locations around the state. IFA maintains a list of participating lenders on its Web site.

Application process
The loan and grant application process under the Program is as follows:

1. The service member locates a participating lender, and fills out a loan application and a grant application form, stating the amount of the requested grant. The service member also provides to the participating lender documentation establishing his or her status with the armed forces of the United States – typically a copy of a valid DD Form 214, four months of leave and earnings statements, a statement of wartime service, or other documentation satisfactory to the Iowa National Guard.
2. The participating lender transmits copies of the loan application, the status documentation, and the grant application to IFA. Upon receipt of the completed grant application, IFA submits the status documentation to headquarters, Iowa National Guard, for verification that the applicant’s duty status is consistent with the definition of “eligible service member.” The Iowa National Guard shall be the final authority as to whether an applicant is an eligible service member. Upon confirmation of the applicant’s duty status by the Iowa National Guard (and provided that the information submitted on the grant application form complies with the requirements of this chapter) IFA shall notify the participating lender that the grant application has been approved.
3. In cases where the grant is approved prior to the closing of the home purchase, the participating lender advances funds at closing in an amount equal to the amount of the grant on behalf of the eligible service member. The advanced funds are applied toward closing costs or the down payment. To be reimbursed for the amount of the grant, the participating lender then submits to IFA a copy of the HUD-1 Settlement Statement, a copy of the deed conveying title to the home, and evidence that a Title Guaranty certificate has been issued.

Program restrictions and limitations
All grants under the program are subject to funding availability. Grants are awarded in the order in which completed grant applications are received. Grants awarded pursuant to the Program are personal to their recipients and may not be assigned. Only one grant shall be awarded per home purchase. An eligible service member shall receive only one grant award under the program.

To learn more, send us an e-mail or call 800.432.7230.