Mortgage Rates in Iowa

Buying a home in Iowa is a big investment, so you'll likely need a mortgage. Since most people take out a large mortgage and pay it off over a long time, it pays to research the best mortgage rates.

Your financial situation affects the rate you pay, and rates can vary among mortgage lenders like banks, credit unions, and online lenders.

5 affordable places to live in Iowa

Many factors go into deciding where to purchase your home. However, choosing a more affordable locale may allow you to have a smaller mortgage, which could potentially help you qualify more easily, get a better rate, and pay off your loan faster. Fortunately, there are many affordable places to live in Iowa, including these five cities and towns.

1. Cedar Rapids

Cedar Rapids has the 18th-lowest cost of living of any American city, according to Niche. It's also an especially affordable place to become a homeowner -- it ranks 10th on the list of best cities in which to buy a house in the U.S. Houses in Cedar Rapids have a median value of just $141,800, substantially below the national median value of $217,500. Those low prices make it easy to see why almost 70% of residents own rather than rent. It's worth noting however that Linn County has a property tax rate of 1.38% of assessed value (Tax-rates.org), which is on the higher end. Cedar Rapids also offers plenty for residents to do, whether that's visiting the Carl and Mary Koehler History Center, checking out the Creative Corridor, or enjoying a visit to Ushers Ferry Historic Village.

2. Davenport

Davenport comes in at No. 26 on the list of the lowest-cost American cities. Also recognized as a top place to live and raise a family, Davenport offers residents homes with a median value of $131,700. However, property taxes in Scott County are among the highest in America. Still, the high tax rate -- 1.35% of a property's assessed fair market value, according to Tax-rates.org -- has not stopped 62% of residents from becoming homeowners.

3. Des Moines

In Des Moines, 6 out of 10 residents own their own homes. Ranked 48th on the list of the most affordable cities, Des Moines offers residents homes with a median value of $133,200 -- although property taxes here are relatively high, with an average rate of 1.6% of a property's assessed value. Residents still find living here affordable, though, and Des Moines has also been ranked as the 96th best city for young professionals, out of 228 urban areas.

4. Fort Madison

This town of just over 10,500 people has a median home value of $81,600, and around 73% of residents are owners. It's also home to Riverview Park, the Sheaffer Pen Museum, and Old Fort Madison, a unique open-air museum. Property taxes in Lee County, are relatively high, although they come in below those of many of the other towns on this list -- they'll set you back an average of 1.29% of the assessed fair market value of your home.

5. Keokuk

Keokuk has been recognized as one of Iowa's most diverse cities. It has a median home value of $71,200, well below the national average, and around 62% of people living in Keokuk own their homes. Like Fort Madison, it's in Lee County, so residents also pay an average property tax rate of 1.29% of a home's assessed fair market value.

Choosing to buy in any of these affordable locales can help you purchase a less expensive home and thus take out a smaller mortgage. A loan with a lower balance will cost you less in monthly payments and in total interest over time, making it much more affordable to become an Iowa homeowner.