See programs you qualify for
Get Matched Free →By Tyler Thompson · Licensed Real Estate Agent · Updated April 23, 2026
Homebuyer Programs in Marshalltown, IA (2026)
Marshalltown is the county seat of Marshall County in central Iowa, with a population around 27,900 and one of the most affordable housing markets in the state — Zillow puts the median home value near $170,000. The City is still recovering from the 2018 tornado that damaged large portions of the housing stock, which has shaped its recent housing strategy. Marshalltown does not currently operate a city-funded down payment assistance program, but its low entry-level home prices mean state programs go further here than almost anywhere else in Iowa. Habitat for Humanity of Marshall County offers a zero-interest mortgage on Habitat-built or rehabilitated homes for qualifying families. Financial Plus Credit Union adds a $5,000 first-time homebuyer grant available statewide. Iowa Finance Authority layers in a $2,500 FirstHome Plus grant, the IFA 2nd Loan Program for up to 5% of purchase price, and the Iowa Mortgage Credit Certificate worth up to $2,000 per year in federal tax savings. Combined, qualifying first-time buyers in Marshalltown can stack $7,500 to $15,000+ in assistance — often enough to cover the full down payment and closing costs on a median-priced home.
State Programs in Iowa
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| FirstHome Plus Grant | Grant | $2,500 grant | Yes | View → |
| FirstHome Program (Iowa) | Government-Insured Mortgage | Low-rate 30-year mortgage with 3% down | Yes | View → |
| Homes for Iowans Program | Government-Insured Mortgage | Low-rate 30-year mortgage available to first-time and repeat buyers | No | View → |
| IFA 2nd Loan Program | Deferred Loan | Up to 5% of purchase price or appraised value (whichever is lower), no maximum cap | Yes | View → |
| Iowa Mortgage Credit Certificate (MCC) | Tax Credit | Up to $2,000 federal tax credit per year (50% of annual mortgage interest paid) | Yes | View → |
| Military Homeownership Assistance Program | Grant | $5,000 grant | No | View → |
- Type:
- Grant
- Amount:
- $2,500 grant
- First-time only:
- Yes
- Type:
- Government-Insured Mortgage
- Amount:
- Low-rate 30-year mortgage with 3% down
- First-time only:
- Yes
- Type:
- Government-Insured Mortgage
- Amount:
- Low-rate 30-year mortgage available to first-time and repeat buyers
- First-time only:
- No
- Type:
- Deferred Loan
- Amount:
- Up to 5% of purchase price or appraised value (whichever is lower), no maximum cap
- First-time only:
- Yes
- Type:
- Tax Credit
- Amount:
- Up to $2,000 federal tax credit per year (50% of annual mortgage interest paid)
- First-time only:
- Yes
- Type:
- Grant
- Amount:
- $5,000 grant
- First-time only:
- No
Federal Programs
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| FHA Loans | Government-Insured Mortgage | Up to FHA county loan limits ($541,287 floor to $1,249,125 ceiling for single-family in 2026) | No | View → |
| Good Neighbor Next Door (HUD) | Government Property Sale Program | 50% discount off the list price of HUD-owned homes | Yes | View → |
| Home Possible Mortgage (Freddie Mac) | Government-Guaranteed Mortgage | Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment | No | View → |
| HomeReady Mortgage (Fannie Mae) | Government-Guaranteed Mortgage | Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment | No | View → |
| HUD $100 Down Program | FHA-Financed HUD REO Purchase | Only $100 down payment required (vs. standard 3.5% FHA down payment). HUD may also pay up to 3% of buyer's closing costs. | No | View → |
| USDA Rural Development Loans | Government-Guaranteed Mortgage | 100% financing (no down payment required); loan amount up to appraised value | No | View → |
| VA Loans | Government-Guaranteed Mortgage | No loan limit for veterans with full entitlement (0% down at any price); partial entitlement subject to conforming limits ($832,750 standard in 2026) | No | View → |
- Type:
- Government-Insured Mortgage
- Amount:
- Up to FHA county loan limits ($541,287 floor to $1,249,125 ceiling for single-family in 2026)
- First-time only:
- No
- Type:
- Government Property Sale Program
- Amount:
- 50% discount off the list price of HUD-owned homes
- First-time only:
- Yes
- Type:
- Government-Guaranteed Mortgage
- Amount:
- Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment
- First-time only:
- No
- Type:
- FHA-Financed HUD REO Purchase
- Amount:
- Only $100 down payment required (vs. standard 3.5% FHA down payment). HUD may also pay up to 3% of buyer's closing costs.
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- 100% financing (no down payment required); loan amount up to appraised value
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- No loan limit for veterans with full entitlement (0% down at any price); partial entitlement subject to conforming limits ($832,750 standard in 2026)
- First-time only:
- No
Nonprofit Programs
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| Financial Plus Credit Union First-Time Homebuyer Grant | Grant | $5,000 grant | Yes | View → |
| Habitat for Humanity of Marshall County Homeownership Program | Zero-Interest Loan | Affordable zero-interest mortgage on a Habitat-built or rehabilitated home | No | View → |
- Type:
- Grant
- Amount:
- $5,000 grant
- First-time only:
- Yes
- Type:
- Zero-Interest Loan
- Amount:
- Affordable zero-interest mortgage on a Habitat-built or rehabilitated home
- First-time only:
- No
How to Apply
Step 1: Check your eligibility. Most Iowa Finance Authority programs cap income at roughly 80% AMI for FirstHome, though Homes for Iowans allows higher income (up to about $139,580). Habitat for Humanity of Marshall County sets its own income bands based on household size.
Step 2: Complete homebuyer education. HOME, Inc. (515-243-1277) is the HUD-certified housing counseling agency serving Central Iowa and delivers the required 8-hour eHome course online at your own pace. Most state and lender grant programs require a completed HUD-approved course before closing.
Step 3: Contact the right local partner. For Habitat for Humanity of Marshall County, visit marshallhabitat.org and apply when the homeownership window opens. For the Financial Plus Credit Union grant, call their loan hotline at 515-669-3380.
Step 4: Get pre-approved with an IFA participating lender. Layering the FirstHome Program, IFA 2nd Loan, and FirstHome Plus grant requires all three to be originated through the same IFA-approved lender. Ask about the Iowa Mortgage Credit Certificate at the same time — it is claimed on your federal tax return each year you occupy the home.
Step 5: Find a home within program limits. Marshalltown's $170,000 median home value is far below any state program purchase price cap, which makes it easy to stack programs. If the home was damaged by the 2018 tornado and later rebuilt or rehabilitated, ask the seller about any remaining city improvement grants tied to the property.
Step 6: Submit your application and close. Plan on 45-60 days from application to closing. Keep records of all assistance received — some programs carry multi-year owner-occupancy requirements.
Step 7: If you are buying a home that needs repairs, the City of Marshalltown's Owner Occupied Housing Improvement Program offers up to $24,999 in forgivable home improvement grants for qualified homeowners (forgiven after five years of continued occupancy). Contact the Housing & Community Development Department at the City of Marshalltown for eligibility once you close.
Frequently Asked Questions
How much down payment assistance can I get in Marshalltown?+−
Does Marshalltown have its own city DPA program?+−
Do I have to be a first-time homebuyer?+−
What is the maximum home price in Marshalltown?+−
How did the 2018 tornado affect homebuyer programs?+−
What homebuyer education is required?+−
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