As interest rates fall, Iowa’s FirstHome mortgage program has followed suit, dropping its interest rate for the fourth time in nine months to 5.5 percent. We talked to Chuck Simmons of Wells Fargo Home Mortgage to explore the new interest rates and some details of the FirstHome program. The program is aimed at helping first-time homebuyers afford a house. All figures given by Simmons pertain to Polk County, unless otherwise specified.

Q: What is the average interest rate on home mortgages, and what effects are interest rates having on consumers?

A: It’s the best interest rate environment I’ve seen since I’ve been in the industry. According to an article by MSNBC, 30-year mortgage rates were averaging 5.84 percent last week. These rates are at some of their lowest levels since 1971, so many people are going to buy a new home or refinance their existing home. When you hear 1971 being referenced, that’s as far back as the records for interest rates go.

Q: Do you anticipate that the rates could fall lower?

A: There are a lot of things that go into that. It’s not impossible that the rates could go lower. Historically, when consumer confidence is low, people are attracted to safer investments, such as bonds, which help to keep mortgage interest rates low.

Q: Is there a ceiling to the value of homes eligible for the FirstHome Mortgage rate?

A: At 5.5 percent, it’s the lowest rate they’ve ever had. In Polk County, there are purchase price limits for an existing homes at $130,800 and for new construction at $162,850. Within each county, there is what is considered a designated targeted area. Targeted area is determined by the Housing and Urban Development established qualified census tract. Targeted census maps are available on the Iowa Finance Authority web site. Your local lender should have the targeted census tract maps available to them. You can contact your local lender to find out where the targeted areas are. In these areas, the program actually allows you to purchase an existing home for $159,850 and a new home for $199,050

Q: What makes a homebuyer qualified for the program?

A: For a one- to two-person family in Polk County, the income cannot be more $66,900. But again, in targeted regions, they’re more flexible; you’re allowed $82,800. For a family of three or more people [the maximum total income] is $76,935, and in the targeted region it’s $93,660.