AHFA First Step Program
Funding status: Active
How much assistance
Up to $10,000 or 4% of sales price, whichever is less (Deferred Loan)
Structured as a 10-year second mortgage combined with a 30-year fixed-rate First Step mortgage at below-market interest rates.
Eligibility
- Income limits: Household income at or below $172,800
- First-time buyer required: Yes — Must not have owned a home in the past 3 years in non-targeted areas. In targeted areas, previous homeownership does not disqualify.
- Credit score minimum: 640
- Geographic restrictions: Statewide in Alabama.
- Homebuyer education required: Yes
How to Apply for AHFA First Step Program
Step 1: Contact an AHFA-approved lender to apply. Complete required homebuyer education course. The lender will process your First Step mortgage application.
Notes
Combines below-market rate first mortgage with DPA. Works with FHA, VA, USDA, and HFA Advantage conventional loans. Maximum DTI ratio of 45%. Over 50,000 families have used this program since 1980.