How to Buy Your First Home in Des Moines With Little or No Money Down (2026 Guide)
Updated: 1 day ago
Can you buy your first home in Des Moines with little or even no money down? In some cases, yes. The important part is knowing the difference between a low down payment, a true zero-down loan, and the total cash you may still need for closing costs, inspections, prepaid taxes and insurance, or reserves.
As of 2026, first-time buyers in Des Moines and Central Iowa may have several financing paths: FHA loans with as little as 3.5% down, conventional programs that can allow 3% down, USDA loans with 100% financing in eligible rural areas, and VA loans that can allow no down payment for eligible veterans and service members. Down payment and closing-cost assistance may also reduce the amount you need upfront if you qualify.
The goal is not to find the loan with the smallest number on a flyer. The goal is to build a financing plan that fits your income, credit, monthly payment, property type, and cash available.
Financing Your First Home in Des Moines With Little or No Money Down
There are four main ways buyers reduce the amount of cash they need upfront: use a low-down-payment mortgage, qualify for a zero-down loan, use assistance if eligible, or negotiate allowable seller-paid closing costs. Sometimes more than one of those pieces can work together.
Financing path | Typical down payment | Best fit |
FHA | As low as 3.5% | Buyers who want a low down payment and flexible qualifying standards |
Conventional 3% programs | As low as 3% | Eligible buyers who prefer conventional financing |
USDA | 0% down for eligible buyers and properties | Qualified buyers purchasing in eligible rural areas |
VA | Often 0% down for eligible borrowers | Qualified veterans, service members, and certain surviving spouses |
FHA Loans: 3.5% Down Can Make the First Step Smaller
FHA financing is one of the most common low-down-payment paths for first-time buyers. HUD states that the down payment can be as low as 3.5% of the purchase price. FHA loans also include mortgage insurance, so the monthly payment needs to be evaluated—not just the down payment.
For a local example, a $200,000 home with 3.5% down would mean a $7,000 down payment. On a $225,000 home, 3.5% is $7,875. On a $250,000 home, it is $8,750.
If you want to see what those price points can buy locally, read What Can $200,000 Buy in Des Moines, Iowa? and my starter-home neighborhood price guide.
Conventional Loans: Some Buyers Can Put 3% Down
Conventional financing does not always require 5%, 10%, or 20% down. Fannie Mae HomeReady and Freddie Mac programs such as Home Possible or HomeOne can allow qualified buyers to purchase with as little as 3% down.
Home price | 3% down | 3.5% down |
$200,000 | $6,000 | $7,000 |
$225,000 | $6,750 | $7,875 |
$250,000 | $7,500 | $8,750 |
Which option is better depends on more than the down payment. Credit profile, income, mortgage insurance, interest rate, property type, and lender guidelines can all change the answer.
Can You Really Buy a Home With Zero Down?
Yes—but only in specific situations.
USDA Loans
USDA's Single Family Housing Guaranteed Loan Program can provide 100% financing for qualified low- and moderate-income buyers purchasing eligible homes in eligible rural areas. That does not mean every town outside Des Moines automatically qualifies. The buyer, the property, and the location all have to meet USDA requirements.
This can be especially relevant when a buyer is open to communities outside the urban core of the Des Moines metro. A lender should verify current property eligibility before you build a search around USDA financing.
VA Loans
For eligible veterans, service members, and certain surviving spouses, a VA-backed purchase loan can often be made with no down payment. VA also does not require monthly private mortgage insurance, although a funding fee may apply unless the borrower qualifies for an exemption.
If you may qualify for VA financing, tell your lender and REALTOR® early. It can significantly change how you plan your cash-to-close.
No Down Payment Does Not Always Mean No Cash Needed
This is one of the most important things I explain to first-time buyers. A zero-down loan covers the down payment requirement, but buyers may still have other expenses.
Home inspection
Appraisal or lender-related costs
Prepaid homeowners insurance
Prepaid property taxes or escrow deposits
Earnest money, depending on the offer
Moving costs and emergency reserves
I break these expenses down separately in How Much Money Do You Need to Buy Your First Home in Iowa?.
Where Down Payment Assistance Fits
Iowa also has programs that may help eligible buyers with down payment and closing costs. I am intentionally not repeating the full program rules here because those rules can change and I already keep a separate article focused on them.
For the detailed Iowa program information, read First-Time Homebuyer Programs and Down Payment Assistance in Iowa.
The practical takeaway is that assistance can sometimes reduce the buyer's cash requirement, but it does not automatically make every loan or every home a good fit. Eligibility, loan type, credit, income, property guidelines, and lender participation all matter.
Can the Seller Help With Closing Costs?
Sometimes. Depending on the loan program and the transaction, a buyer may be able to negotiate for the seller to contribute toward allowable closing costs. That can reduce the amount the buyer needs to bring to closing.
But seller-paid costs are part of the negotiation. They are not guaranteed, and the strongest strategy depends on the home's price, competition, condition, appraisal, and the seller's priorities. I would rather structure an offer around the actual property than assume every seller will pay the same amount.
What About Gift Funds or Lender Credits?
Some loan programs allow eligible gift funds or grants to help with down payment or closing costs. Lender credits may also reduce upfront closing costs, although they can come with a higher interest rate or other pricing tradeoffs. This is exactly why I want the lender involved before we start writing offers.
A Local Example: Buying Around $225,000 in Central Iowa
Suppose a first-time buyer is approved around $225,000. A 3% conventional down payment would be $6,750. A 3.5% FHA down payment would be $7,875. A qualified USDA or VA buyer could potentially have no down payment requirement.
Then we look at the second layer: closing costs, inspection, prepaid expenses, assistance eligibility, seller credits, and how much cash the buyer wants to keep after closing. That full picture is more useful than asking only, “How much do I need for the down payment?”
The Best First Step Is Not Shopping for Houses
If your biggest concern is that you do not have enough money saved, the first step is not to eliminate yourself from buying. It is to talk with a lender who works with first-time buyers and find out which financing paths you actually qualify for.
A good pre-approval conversation can answer questions such as:
Do I qualify for FHA, conventional, USDA, or VA financing?
Could I qualify for down payment or closing-cost assistance?
How much cash would I realistically need at closing?
What monthly payment keeps me comfortable?
Would improving my credit or paying off a small debt help?
Are there property types or locations I should avoid because of my financing?
Frequently Asked Questions About Buying With Little Money Down
Do first-time buyers need 20% down in Des Moines?
No. Many qualified buyers use loan programs requiring far less than 20% down. Some conventional loans can allow 3%, FHA can allow 3.5%, and eligible USDA or VA borrowers may qualify for zero-down financing.
Can I buy a house in Iowa with no money saved?
Possibly, but it is safer to think in terms of cash-to-close rather than down payment alone. Even with a zero-down loan or assistance, you may still need money for inspections, prepaid expenses, or costs that are not covered by another source.
Is FHA always best for a first-time buyer?
No. FHA is one strong option, but some buyers are better served by conventional, USDA, VA, or another program. The right answer depends on the buyer and the property.
Can down payment assistance be combined with a low-down-payment loan?
Sometimes, yes. The exact combinations depend on the assistance program, lender, loan type, and current program rules. That is why eligibility should be verified before making assumptions.
Should I Talk to a REALTOR® or a Lender First?
You can talk to either first, but before we seriously shop for homes, I want you connected with a lender. That way we know your real budget, financing type, cash needed, and whether the homes we are looking at fit the loan program.
If you are just starting, visit my First-Time Homebuyer page for Des Moines and Central Iowa. I can also connect you with trusted local lenders who regularly work with first-time buyers.
Sources and 2026 Program References
HUD: FHA loan information | USDA Rural Development: Single Family Housing Guaranteed Loan Program | U.S. Department of Veterans Affairs: VA-backed purchase loans | Opportunity Iowa / Iowa Finance Authority homeownership programs
Dallas L. Wood, REALTOR® — Realty ONE Group Impact | Helping you find your Sacred Space.
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