New Option in Iowa to Save for a Down Payment for a Home
Coming up with a hefty down payment will no longer be a huge hurdle for people buying their first home in Iowa.
That’s because buying a first home just got easier.
The Iowa legislature recently passed legislation that included the First Time Homebuyers Savings Account Program, which now allows individuals or couples to save the money they need in a tax-free savings account to go toward the purchase of a home.
No longer do you have to worry about coming up with the money necessary to cover additional closing costs, taxes and fees associated with buying a home.
Because now you can save the money you need for such an important life investment tax-free.
It’s an initiative to incentivize homeownership, which is the backbone of safe neighborhoods, healthy schools, a consistent labor force and stronger communities, especially here in Iowa.
In a recovering housing market in the wake of the worst recession in 70 years, a variety of strategies are needed to support and encourage homeownership. Creating this savings account is a great first step.Five things you need to know about the Iowa First Time Homebuyers Savings Account Program.Click To Tweet
Here’s five things you need to know about the Iowa First Time Homebuyers Savings Account Program:
- Individuals or couples can establish a dedicated savings account at their local bank or credit union, a savings and loan institution or a trust company for the purchase of a first home in Iowa regardless of their income.
- Individuals and couples qualify for this loan as long as they haven’t owned a home of any kind for at least three years.
- Parents or grandparents can open an account for their children or grandchildren and contribute to those accounts as well.
- Annual contributions are capped at $4,000 for married joint filers and $2,000 for all other filers. The cap for the account is $20,000.
- All interest and dividends earned on this account can be claimed as an income tax deduction.
Visit IowaFirstHome.com or contact a Iowa REALTOR® to learn more.