Saving for a down payment can be tough.
Even though there are a few 100% Financing options available in today's market, sometimes getting a mortgage will require at least a small down payment.
In a recent survey completed by NeighborWorks America, they noted that 62% of millennials and 73% of all consumers were either unaware or unsure about down payment assistance programs available in their community.
Here in Alabama, there are several down payment options available.
Alabama Housing Finance Authority
Alabama Housing Finance Authority, or AHFA, offers the Step Up program to homebuyers who can likely afford a mortgage, but just need help with the down payment.
The Step Up loan offers down payment assistance of 3% of the purchase price (up to a max of $7500). This amount is secured as a 10-year fixed rate 2nd mortgage. The interest rate for this 2nd mortgage is the same exact rate that is locked on the 1st mortgage. Interest rates are posted daily at AHFA.com.
See If You Qualify For An AHFA Step Up Loan
The Step Up program is available statewide to qualifying households making less than $97,300. The 3% down payment assistance can be used in conjunction with an FHA loan which typically requires 3.5% down, or a Conventional loan which requires just 3-5% down.
The AHFA Step Up loan does require a reservation fee, that is between 0.5 - 0.75% of the loan amount, and this fee