This program funding facilitates and expands homeownership among low- and moderate- income homeowners.
Applications for funding are accepted and reviewed on an on-going basis, as funds are available.
Activities covered by this program are:
- Up to 50% of the down payment required by the homebuyer’s lender
- Required closing costs up to $3500 per household
- Property inspection fees up to $300 per household
The maximum amount of homebuyer assistance for the above activities per household is limited to $24,999. Technical services including radon testing plus lead hazard reduction carrying costs cannot exceed $5,500 in total federal funds. Total federal fund costs per property may not exceed $38,500.
All incorporated cities and counties in the State, except those designated as HUD entitlement areas, are eligible to apply for and receive funds under this program.
To be eligible for funding, homebuyers must be low to moderate income. For purposes of the CDBG program “low and moderate income” is defines as persons with incomes at or below 80% of the area median income limits by household size as defined by the U.S. Department of Housing and Urban Development. Current income levels can be found on the IEDA website: http://www.iowaeconomicdevelopment.com/Community/CDBG
2 CFR 200 Audit Requirements –
CDBG contracts must be subject to audit. Federal Code (2 CFR 200) requires that recipients theta exceed $750,000 or more in federal funds within a fiscal year must have a single or program specific audit. When budgeting for CDNG funds, applicants should be aware of these audit requirements:
- For recipients of $750,000 or more in federal funds received from more than one source of federal funding, an organization-wide audit must be conducted in accordance with deferral requirements outlined in 2 CFR 200.514.
- For recipients of $750,000 or more in federal funds received from a single source, a project audit, targeting only transactions dealing specifically with the project, may be performed in lieu of an organization-wide audit.
Communities should consult with their accountants regarding the applicability of an audit and audit requirements.
Audit costs are a CDBG-eligible expense. Organization-wide audits can be paid with CDBG funds proportional to the amount of all other funds included in the audit. The total cost of a project audit can be paid with CDBG funds.
Uniform Relocation Review Requirements –
For projects that include acquisition and relocation, all recipients given the authority to acquire property are required to follow the guidelines in HUD Handbook 1378 – Tenant Assistance, Relocation and Real Property Acquisition. Cost estimates for the proposed project should reflect compliance with these requirements. For information, call IEDA (515-348-6207)
Environmental Review and Project Initiation –
No HUD funds or non-HUD funds may be committed to the project until the applicant has secured environmental approval from the State, as provided in HUD regulation 24 CFR Part 58. In addition, pending environmental approval and pursuant to 24 CFR Part 58.22(a), no grant recipient or participant in the development process, including contractors or sub-contractors, may undertake activity that may limit the choice of reasonable alternatives. Such choice limiting actions include, real property acquisition, conducting a competitive sealed bid proceed for the project, leasing, rehabilitation, repair, demolition, conversion, and new construction.
Additional Requirements –
Additional program requirements for the CDBG Homebuyer Assistance program can be found here: