Iowa Mortgage and Refinance Rates

Current mortgage rates in Iowa

As of Monday, September 15, 2025, current interest rates in Iowa are 6.75% for a 30-year fixed mortgage and 6.13% for a 15-year fixed mortgage. Like the rest of the country, borrowers in Iowa are dealing with mortgage rates that don't seem poised to make any meaningful drops anytime soon. If the Federal Reserve opts to cut the federal funds rate in the back half of 2025, mortgage rates could edge down, but rates will likely spend the rest of the year above 6 percent.

Refinance rates in Iowa

Refinance rates in Iowa are hovering in the same territory as purchase rates: between 6.5 and 7 percent. Despite that, refinancing activity in the state is actually up. The number of refinance loans in May 2025 was up over 23 percent from the year prior, according to ATTOM. 

In addition, the rise in home values has increased the equity stakes that many homeowners have. You might consider using that home equity to do a cash-out refinance on your Iowa home to pay for renovations or other expenses.

National mortgage rates by loan type

Iowa mortgage rate housing market statistics and trends

Mortgage rates in Iowa may not be all that appealing compared to the pandemic-era lows, but the median home sale price in the Hawkeye State is modest compared to the national median price. Whether you want the city life of Des Moines or a place rich with outdoorsy activities like Decorah, use these statistics to inform your homebuying process in Iowa:

• Median sale price (June 2025): $256,400
• Median days on market (June 2025): 30 (up 3 days from year prior)
• Median down payment (May 2025): $26,350
• Months of supply (June 2025): 2 (indicating a seller's market)
• Homes with price drops (June 2025): 35.2% (up 5.6 percentage points from year prior)

Sources: Redfin, ATTOM

Mortgage options in Iowa

Like elsewhere in the U.S., there are various mortgage options in Iowa to suit a range of needs and financial circumstances. Here are some of the most common:

• Iowa conventional mortgages: To qualify for a conventional mortgage, you’ll need a minimum credit score of 620 and a debt-to-income (DTI) ratio of no more than 45 percent. With a down payment of less than 20 percent, you’ll need to pay private mortgage insurance (PMI) premiums, as well.
• Iowa FHA loans: If your credit history disqualifies you from a conventional mortgage, you might be able to obtain a loan insured by the Federal Housing Administration (FHA). If you have a down payment of at least 3.5 percent, you could qualify for this type of loan with a credit score as low as 580.
• Iowa VA loans: If you’re a veteran or active-duty member of the military, you might qualify for a mortgage guaranteed by the Department of Veterans Affairs (VA). A VA loan doesn’t require a down payment or mortgage insurance, but you do need to pay a funding fee, which ranges from 1.25 percent to 2.15 percent for the first use.
• Iowa USDA loans: If you’re buying a rural property in Iowa, you might be eligible for a mortgage guaranteed by the U.S. Department of Agriculture (USDA). USDA loans don’t require a down payment, but you’ll need to purchase in a designated rural area and meet the area’s income limits.

First-time homebuyer programs in Iowa

The state of Iowa’s first-time homebuyer program is operated by the Iowa Finance Authority (IFA) and provides buyers assistance with the down payment and closing costs. 

• FirstHome Program: Called the FirstHome program, qualified homebuyers can obtain a mortgage with a below-market interest rate as well as either a $2,500 grant to put toward the down payment and closing costs or a second loan of up to 5 percent of the home's sales price. To be eligible, you’ll need to be within household income limits, which depend on the home's location and your household size.
   
• Homes for Iowans: For repeat buyers and first-time homebuyers with higher incomes than what FirstHome allows, Homes for Iowans offers a lower interest rate mortgage with fewer fees. There’s a household income limit of $173,460 and a home purchase price limit of $665,000. You may also be eligible for closing cost and down payment assistance.
   
• Military Homeownership Assistance Program: Iowa’s Military Homeownership Assistance Program is a $5,000 grant for service members, veterans and surviving spouses that can be used toward the down payment and closing costs. The money can be used together with the FirstHome program. There are certain eligibility requirements to meet, including length of service, and you must work with an IFA-approved lender to qualify.

How to find the best mortgage rate in Iowa for you

Additional Iowa mortgage resources

• Iowa loan limits by county: Learn the conforming and FHA loan limits for your city or county.
• Iowa mortgage lenders: Explore home loan lenders in your state.
• Iowa homeowners insurance: Compare policies from a variety of providers.