Alabama is a state with rich history. It's also listed as one of the states with the lowest median house prices! This means if you're looking for a good deal on real estate, Alabama might be the way to go.
Local and national programs exist that offer down payment assistance and grants to qualified applicants, which can also be helpful for homebuyers in Alabama. Such programs are offered by the US Department of Housing and Urban Development and the Alabama Housing Finance Authority.
If you're thinking about purchasing a home in Alabama, you may have options to help with the down payment or closing costs. Click on any program below to learn more and see if it can help with your home purchase!
The Step Up Program, offered by the Alabama Housing Finance Authority (AHFA), provides a loan of as much as 3% of the purchase price of a home to eligible applicants to help cover the costs of the down payment, closing costs, and prepaid items. The loan is a second mortgage with a 10-year term and is combined with a 30-year fixed rate mortgage.
Interested borrowers must have a minimum credit score of 620, an annual household income of less than $97,300, and must finish a homebuyer education class. In order to be eligible, the home being purchased must be in Alabama and the borrower must use the house as their primary residence no more than 60 days after closing.
Through the Mobile County Down Payment Assistance Program, qualified individuals can receive a grant for between $1,000 and $10,000 to help cover costs associated with the down payment and closing. This program is funded by the US Department of Housing and Urban Development.
In order to qualify, applicants must either be first-time homebuyers or participating in the New Construction Affordable Homes Program.
As of 2020, the annual household income limits are:
- 1 person household: $18,901 to $30,200
- 2 person household: $21,601 to $34,500
- 3 person household: $24,301 to $38,800
- 4 person household: $26,951 to $43,100
- 5 person household: $29,151 to $46,550
- 6 person household: $31,301 to $50,000
- 7 person household: $33,451 to $53,450
- 8 person household: $35,601 to $56,900
The house being purchased using this grant must be the applicant’s primary residence for a minimum of 5 years and cannot be a mobile home, condominium, townhouse, or duplex or multiplex unit.
The house must also be located in Bayou la Batre, Chickasaw, Citronelle, Creola, Mount Vernon, Prichard, Saraland, Satsuma, Semmes, or the unincorporated areas of Mobile County.