July 17, 2024

Since the relaunch of the First Step program, we have seen a rise in errors when submitting the Step 1 and Step 2 packages. To correct these errors, we have created a short list of items to double-check before submission. Please contact us at lenderhelp@ahfa.com if you have any questions. Thank you!

One common mistake we find in submissions is the amount presented as the Commitment Fee. This fee is based on the total loan amount, not the sales price of the loan.

The Recapture Application Disclosure, Sellers Certification Affidavit and the Borrower Affidavit are now required documents for the Step 2 submission. Make sure you are using the revised Step 2 Transmittal Checklist. Program checklists are posted on Lender Online - Program Documents.

The Mortgagee Certification form requires the lender to provide a wet signature or E-doc signature. A typed signature with a script font is not acceptable.

Both Section A and B of the pre-closing CD must be completed and submitted with the Step 2 Package.

• Maximum Origination Fee - 0.50%

• Lender Fees - cannot exceed $1,300

• Tax Service Fee - currently $80



*Please note that this fee will increase to $85 effective October 1, 2024, on loans of $500,000 or less, with an incremental $10 upcharge to be assessed for every $100,000 over a loan amount of $500,000. For example:



Loan Amount                  Tax Service Fee

$1-$500,000                     $85

$500,001-$600,000         $95

$600,001-$700,000         $105

• AHFA Funding Fee - $211

Conventional borrowers whose qualifying income is at or below 80% AMI are eligible for Affordable Income Subsidy Grant funds offered by Freddie Mac. These grant funds must be listed in Section L of the pre-closing CD. See section IV of Allregs for full details.

The AHFA Income Calculation Worksheet document must be competed and submitted with the Step 2 package.

Alabama Housing Finance Authority