The four sums worth doing before you reserve
Program and regulatory figures verified October 5, 2026. Details change; confirm your scenario with us.
Most assistance calculators answer one question. In Alabama the number you get is capped, the money is a loan, and there is a fee on the way in.
Sum one: how much assistance?
4% of the sales price, capped at $10,000. The cap bites at exactly $250,000, because 4% of $250,000 is $10,000.
| Purchase price | 4% of price | You receive | As a share of price |
|---|---|---|---|
| $150,000 | $6,000 | $6,000 | 4% |
| $180,000 | $7,200 | $7,200 | 4% |
| $225,000 | $9,000 | $9,000 | 4% |
| $250,000 | $10,000 | $10,000 | 4% — the crossover |
| $300,000 | $12,000 | $10,000 | 3.3% |
| $350,000 | $14,000 | $10,000 | 2.9% |
| $400,000 | $16,000 | $10,000 | 2.5% |
This is the same on First Step and Step Up. The programmes differ on eligibility, not amount.
What that means in practice: Birmingham's typical value of $262,563, Huntsville's $315,402 and Daphne's $372,137 are all past the crossover, so most Alabama buyers receive the flat $10,000. Tuscaloosa, at $241,271, is the one major metro still under it.
★ Sum two: what does it cost to take?
Ten years of payments. The assistance is an amortizing second mortgage at the same interest rate as your first, so this is not free money with a repayment at the end — it is a loan you service monthly from the first month.
We do not publish payment figures anywhere on this site, because a payment without a locked rate and a real file behind it is a number people plan around to their cost. But the shape of the sum is simple: a $10,000 loan, ten-year term, priced at your first mortgage rate, and that payment sits inside AHFA's 45% debt-to-income ceiling.
Which leads to the question worth asking before the arithmetic: do you need it? AHFA sets no minimum borrower investment and says plainly that a borrower can bring their own down payment instead. When the second is worth it.
Sum three: the money you keep
The Affordable Income Subsidy Grant, on HFA Advantage conventional, if your income is at or under 80% of your county's area median.
| Loan amount | At or below 50% AMI (1%) | 50.01–80% AMI (0.5%) |
|---|---|---|
| $150,000 | $1,500 | $750 |
| $200,000 | $2,000 | $1,000 |
| $250,000 | $2,500 | $1,250 |
| $300,000 | $3,000 | $1,500 |
Smaller than the assistance, and worth more per dollar, because none of it comes back. How to qualify.
Sum four: the commitment fee, First Step only
Wired to AHFA within 72 hours of reservation, set by how long you lock.
| Loan amount | 30-day lock (0.50%) | 45-day lock (0.75%) | Difference |
|---|---|---|---|
| $200,000 | $1,000 | $1,500 | $500 |
| $250,000 | $1,250 | $1,875 | $625 |
| $300,000 | $1,500 | $2,250 | $750 |
No commitment fee on the second mortgage. Detail.
What arithmetic cannot tell you
Whether your address is targeted. It changes your income limit by 20%, your price cap by $125,856, and whether a repeat buyer gets into First Step at all. No table on this page knows your street.
Your qualifying income. Self-employment, overtime and bonus income are each calculated to a guideline rather than read off a pay stub — and AHFA counts borrowers only, not the household.
Whether the file works. 640 credit, the 45% ratio with the second loaded into it, the property's eligibility, the education certificate. None of that is arithmetic.
What is not on this site
No rates, no APRs, no payment figures, anywhere. First Step's whole advantage is its below-market rate, and that rate changes often — AHFA issued rate-change notices three times in September 2026 alone. Publishing one would mislead within a fortnight. Ask and we will run your actual numbers.
Frequently asked questions
How much down payment assistance will I get in Alabama?
4% of the sales price up to a maximum of $10,000, on either First Step or Step Up. Because 4% of $250,000 is exactly $10,000, any purchase at or above $250,000 receives the flat $10,000 rather than a percentage.Does the Alabama $10,000 assistance cap affect most buyers?
Yes. The cap binds above a $250,000 purchase price, and Birmingham's typical home value is $262,563, Huntsville's $315,402 and Daphne's $372,137. Tuscaloosa at $241,271 is the one major Alabama metro still below the crossover.How much is the Affordable Income Subsidy Grant worth?
1% of the loan amount for borrowers at or below 50% of area median income, or 0.5% for borrowers between 50.01% and 80%. On a $200,000 loan that is $2,000 or $1,000, and unlike the down payment assistance it is never repaid.Can a calculator tell me if I qualify for AHFA?
It can compare your income against the published limits and size the assistance at your price. It cannot confirm whether your address is in a targeted census tract, how your qualifying income is calculated under AHFA guidelines, or whether the file clears the 640 credit and 45% debt-to-income requirements once the assistance payment is included.Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content about financing, not a loan commitment and not legal or tax advice. AHFA program terms, income limits and sales price limits are set by the Alabama Housing Finance Authority and change; figures here carry the date we verified them against AHFA's published documents. AHFA down payment assistance is an amortizing second mortgage with a monthly payment, not a grant. Federal recapture tax may apply on First Step bond loans; consult a tax advisor. Loans are subject to borrower and property qualification.