Information for the Alabama First Time Home Buyer
In the state of Alabama the real estate market is doing fairly well considering the conditions that exist all over the country. Currently real estate is a mixed bag in Alabama, with the total dollar value of transactions increasing from a year ago while at the same time total number of units sold is down. This suggests that prices in the state are beginning to moderate and trend upward. While experts don't expect housing prices to return to their peak of just a few years ago, the slight increase in value is being seen as the first signs of a rebounding market.
Huntsville seems to be the hotbed of the state due to the perception that it has the potential for a burgeoning economy. There is a new commercial development all over the city including new office buildings and retail outlets. This is seen as a positive sign for the overall real estate climate heading into the New Year and beyond. Other cities of interest in the state include Decatur and Birmingham.
State Programs Available for Alabama First Time Home Buyers
First time home buyers in the state have access to limited financial help through the Alabama Housing Finance Authority. Since 1980 the Authority has provided over $150 million in financial assistance to more than 30,000 home buyers in the state. Funds are provided through the sale of tax-exempt bonds offered by the Authority. Unfortunately, there are only two programs currently administered by the AHFA, one of which has no funding available at this time. Those two programs are as follows.
- First Step Program - When this program is funded it provides mortgages to qualified individuals and families at rates that are significantly less than the current market. To qualify for this program, home buyers must purchase a property located in one of several targeted areas according to federal guidelines at the time of application. Those targeted areas change depending on federal standards and targets for community economic development. Furthermore, applicants must meet income and credit requirements similar to what is required for an FHA or VA loan. The purchaser must live in the home as his principal residence and cannot have owned a home any time during the previous three years.
- Step Up Program - The Step Up program is unique in that it provides 100% housing for first time home buyers purchasing property in a designated federal disaster area. The program is designed to help rebuild and maintain the housing market in areas that have been devastated by natural events such as tornadoes and hurricanes. The current rate for the program is 4.5%. Like the First Step program there are certain income and credit eligibility requirements.
This program is offered in conjunction with the US Department of Housing and Urban Development (HUD) and is therefore subject to some HUD requirements as well. The program offers special assistance to victims of the April 27 tornadoes which devastated large portions of the state. Those who qualify may be able to get a mortgage with 100% financing and no down payment.
Check with Your Real Estate Agent
Now is a great time to buy your first home in the state of Alabama. Even though state programs are not as plentiful here is they are in some other states, there are still plenty of lenders willing to supply both conventional and FHA-backed mortgages. First time home buyers in Alabama should enlist the aid of a licensed real estate agent and a qualified mortgage lender. Between the two they can steer you not only to the right properties, but all of the financial assistance that might be available.
