Income and Sales Price Limits Increase for First Step, MCC Programs

June 06, 2024

More homebuyers now qualify for Alabama Housing Finance Authority (AHFA) assistance programs, thanks to newly increased income and sales price limits effective May 22.

Set by the U.S. Department of Housing and Urban Development, the new income limits increased over 2023 figures by as much as 33 percent due to increasing median incomes and economic gains. Qualifying households now can earn up to $159,040 annually, depending on the home’s location and family size.

The changes benefit participants in the First Step Mortgage Revenue Bond (MRB) and Mortgage Credit Certificate (MCC) programs, available to Alabama homebuyers only through AHFA.

The First Step MRB program offers below market, 30-year fixed mortgage interest rates and up to $10,000 in down payment assistance to first-time or repeat homebuyers. The MCC gives homebuyers an annual credit to reduce federal income tax. The credit is equal to a percentage of mortgage interest paid for every year of the life of the loan.

Designed to make homeownership more affordable, both programs are available on a first-come, first-served basis by a statewide network of participating lenders, said AHFA Executive Director Robert Strickland.

“We are pleased to open these popular programs to even more Alabama homebuyers through higher income and sales price limits,” said Strickland. “These homeownership programs result in real savings over the life of a mortgage loan. Despite constantly changing market conditions, homeownership remains one of the best paths to economic stability and strong communities.”

Maximum sales prices for the home purchase have risen as well, to $624,481 in “target” areas and $510,939 in “non-target” areas. These areas are set by the federal government to encourage economic development. AHFA will verify each property’s location and apply the appropriate limit on an individual basis. Both programs are available on 30-year, fixed-rate, amortizing conventional, FHA, VA, Rural Development, or privately insured mortgages.

Several parts of the state, both rural and urban, have their own income limits based on each area’s median income. Visit www.ahfa.com/homebuyers/programs-available/mccs/income-limits for a complete listing.