Step Up helps low- to moderate-income applicants achieve their homeownership goals, by providing down payment assistance. The funds are made available in the form of a 10-year second mortgage and are combined with a 30-year, fixed-rate first mortgage.

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April 22, 2019
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Step Up Program

Financial Assistance for Homebuyers in Alabama

The Alabama Housing Finance Authority (AHFA) aims to make the mortgage process more affordable for eligible applicants who are interested in purchasing a home but need financial help to do so. AHFA’s Step Up Program provides applicants with funds to help pay the upfront costs associated with a mortgage transaction, such as the down payment, closing costs, and prepaid items.

Available Assistance:
The Alabama Housing Finance Authority’s Step Up program helps low- to moderate-income applicants achieve their homeownership goals by providing down payment assistance of up to 3 percent of the purchase price. The funds are made available in the form of a 10-year second mortgage and are combined with a 30-year, fixed-rate primary mortgage. 

Eligibility Requirements:
In order to apply for the Step Up program, homebuyers must meet the certain requirements. All applicants are required to have a credit score of at least 620, and their annual household income must not exceed $97,300, regardless of family size or property location. The property must be financed by an AHFA-approved conventional loan through a participating lender. Applicants are also responsible for completing a homeownership education course.

Property Guidelines:          
Any property being purchased must be a new or existing home in Alabama that is meant to serve as the applicant’s primary residence, within 60 days of closing.

*Seller-funded down payment programs were eliminated in the Housing and Economic Recovery Act of 2008, but States and Local government agencies are still permitted to help borrowers finance their homes with second mortgages and grants. These agencies set different requirements that a borrower needs to meet in order to qualify for the grant programs, such as property location, and purchase price and income limits.

Note:  All figures mentioned above were accurate at the time of publication and may no longer be current - Visit the program website for updated information. spacer

Down payment assistance programs and/or grants were researched by the team at FHA.com. Please note that all programs listed on this website may involve a second mortgage with payments that are forgiven, deferred, or subsidized in some manner until resale of the mortgaged property.

FHA.com's compilation is not a complete list, but it can serve as a starting point in your search for the down payment assistance program or grant for your situation. It is up to the consumer to contact these entities and find out the specifics of each program.

Down Payment Grants in Alabama

The Mobile County Down Payment Assistance Program provides income-eligible applicants assistance funds between $1,000 and $10,000 in the form of a grant. This money may be put toward the down payment and closing costs associated with the mortgage transaction. 

Step Up helps low- to moderate-income applicants achieve their homeownership goals, by providing down payment assistance. The funds are made available in the form of a 10-year second mortgage and are combined with a 30-year, fixed-rate first mortgage.

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