Alabama Down Payment Assistance Programs

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‘Bamers! Let’s get you a house!

Listed below are down payment assistance programs for the state of Alabama. We’ve listed them in two categories: statewide and county/ city specific. If you don’t see a DPA program for your county, don’t be disheartened. New grants and services are made every day. Also, the best program that works best for you may not be advertised on the web. Before applying to a statewide or national down payment assistance program, contact your county’s local housing authority because they may have a program better suited to your needs.

Also: Cities are statistically more likely to have a DPA program than suburban counties. It is what it is. However, even if you don’t consider your purchase area to be ‘rural,’ the US Department of Agriculture may disagree.

The Department of Agriculture offers a loan called a USDA (short for, you guessed it, United States of Agriculture). Though a USDA loan is not technically a DPA, it is a 0% down loan, so it’s effectively the same thing. You’ll still need to have closing costs figured out, but if you’re smart you’ll ask the seller to pay those.

While USDA programs may only be listed below in certain counties, that doesn’t mean you can’t get a USDA loan elsewhere. All it means is that it’s not as prevalent in your preferred county. Find a house you like and look it up on the USDA website. Even if you work in a city, you may be able to find a USDA approved home within a short driving distance.

Statewide Down Payment Assistance Programs for Alabama State:

Alabama Housing Financing Authority: Step Up

  • Website: http://www.ahfa.com/homebuyers/programs-available

  • 3% of the purchase price (maximum of $7,500)

  • 10-year fixed rate 2nd mortgage

  • Interest rate is the same that is locked in on the first mortgage

  • Must make less than $97,300 a year (click here for specific income limititations)

  • Can be used with either a conventional loan or FHA Loan

  • Borrower must pay a fee of 0.5-0.75% of the DPA loan amount, that can be paid prior or at closing

  • Must complete a homeownership education course

  • Need a credit score of 620 or higher

  • HFA Preferred conventional loans only

  • Must be an existing or new house in the state of Alabama

  • Must apply for the loan through one of their participating lenders (click here for full list)

Down Payment Assistance Programs in Butler County, Alabama:

Housing and Redevelopment Authority County of Butler

Neighborhood Housing Services of Hamilton, Inc.

  • Website: http://www.butlercounty-nhs.org/id6.html

  • Comes in the form of a forgivable loan.

  • “First come first serve.”

  • Your yearly income must be at or below 80% of the median income.

  • Must attend 8 hours of purchase counseling

  • Purchase price must be at or below $149,000.

  • Maximum DPA is $5,000.

  • Must pay 1% of the purchase price.

  • Must live in the property for five years. If not, you will have to pay a prorated amount for the amount of time you’re absent.

  • Note: This program is available in the City of Hamilton, Butler County, and the City of Middletown.

Down Payment Assistance Programs in Calhoun County, Alabama:

City of Middleton: Neighborhood Housing Services of Hamilton, Inc.

  • Website: http://www.butlercounty-nhs.org/id6.html

  • Comes in the form of a forgivable loan.

  • “First come first serve.”

  • Your yearly income must be at or below 80% of the median income.

  • Must attend 8 hours of purchase counseling

  • Purchase price must be at or below $149,000.

  • Maximum DPA is $5,000.

  • Must pay 1% of the purchase price.

  • Must live in the property for five years. If not, you will have to pay a prorated amount for the amount of time you’re absent.

  • Note: This program is available in the City of Hamilton, Butler County, and the City of Middletown.

Down Payment Assistance Programs for Colbert County, Alabama:

USDA Rural Development

Down Payment Assistance Programs in Cullman County, Alabama:

USDA Rural Development

Down Payment Assistance in Jackson County, AL:

USDA Rural Development

Down Payment Assistance in Jefferson County, Alabama:

Birmingham Community Development

NeighborhoodLift Program

  • $7,500 for qualified properties

  • Not limited to first-time buyers

  • Must be below income limits (see chart)

  • Property must be in Jefferson County

  • Purchase must be for a primary, owner-occupied home of the buyer(s)

  • Can be used for the purchase of a detached home, townhouse, condominium, 1-4 unit property, or planned unit development

  • 3-year forgivable loan.

  • If the borrower does not reside in the home at the end of the 3 year anniversary because of a transfer or move, the entire balance will be immediately due

  • As long as the borrower resides in the home, the loan will be forgiven at a prorated amount each year on the anniversary date of the settlement

  • Only the borrower’s income is calculated.

  • You may be required to make an additional down payment contribution from your own funds if your 'remaining liquid assets' at the time of your eligibility determination session will exceed $20,000.

  • Must use one of the following approved lenders: Wells Fargo, Bancorp South, BB&T, Regions, Renasant Bank, Synovus Mortgage

  • If you currently own a home, but will be selling prior to closing on the NeighborhoodLift Property, you are still eligible for DPA. However, at the time of closing, you may not own any other properties

  • Short sale properties are eligible

  • Wells Fargo real estate owned properties are not eligible

Down Payment Assistance Programs in Lauderdale County, Alabama:

USDA Rural Development

Down Payment Assistance Programs in Lawrence County, Alabama:

USDA Rural Development

Down Payment Assistance Programs in Lee County, Alabama:

City of Opelika: Community Development Services

  • Grant of up to 50% lender required down payment.

  • $6,000 maximum

  • Home must be within the Opelika City limits

  • Must be Owner Occupied

  • Home buyer must complete an education course

  • Eligibility is determined by family size and total household income

  • Grant comes from the Community Development Block Grant (CDBG)

Down Payment Assistance Programs in Limestone County, Alabama:

City of Decatur: Decatur H.O.M.E.

Down Payment Assistance Programs in Macon County, Alabama:

USDA Rural Development

Down Payment Assistance Programs in Madison County, Alabama:

City of Huntsville: Home Program


Huntsville: USDA Rural Development

Down Payment Assistance Programs in Marion County, Alabama:

City of Hamilton: Neighborhood Housing Services of Hamilton, Inc.

  • Website: http://www.butlercounty-nhs.org/id6.html

  • Comes in the form of a forgivable loan.

  • “First come first serve.”

  • Your yearly income must be at or below 80% of the median income.

  • Must attend 8 hours of purchase counseling

  • Purchase price must be at or below $149,000.

  • Maximum DPA is $5,000.

  • Must pay 1% of the purchase price.

  • Must live in the property for five years. If not, you will have to pay a prorated amount for the amount of time you’re absent.

  • Note: This program is available in the City of Hamilton, Butler County, and the City of Middletown.

Down Payment Assistance Programs in Marshall County, Alabama:

USDA Rural Development

Down Payment Assistance Programs in Mobile County, Alabama:

Mobile County Down Payment Assistance Program

  • Website: https://www.fha.com/grants/alabama-mobile-county-down-payment-assistance

  • Non-repayable grant

  • Minimum of $1,000; maximum of $10,000

  • May be used for either down payment or closing

  • There are income eligibility requirements

  • Must be a first time buyer (unless participating in the New Construction of Affordable Homes Program, or a single parent who has divorced within the last three years)

  • Must be able to put at least $500 in cash towards the purchase of the home

  • The following residences are not eligible: Mobile Homes, Condominiums, townhouses, duplexes, multiplex units, foreclosures, or houses with liens

  • Must occupy the property for five years, or the DPA program must be paid back in full

  • Home must be located in Boyou la Batre, Chickasaw, Citronelle, Creola, Mount Vernon, Prichard, Saraland, Satsuma, Semmes, or unincorporated areas of Mobile County

  • Income Limits: 1 person household:

    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

Down Payment Assistance Programs in Morgan County, Alabama:

City of Decatur: Decatur H.O.M.E.

USDA Rural Development

Down Payment Assistance Programs in Tuscaloosa County, Alabama:

Homebuyers Assistance Program for Disaster Recovery