Down Payment Assistance Program (City of Mobile)

What is Down Payment Assistance Program (City of Mobile)?

Down Payment Assistance Program (City of Mobile) is a forgivable loan for homebuyers in Mobile, Alabama, administered by City of Mobile Community & Housing Development Department.

• The City of Mobile's First Time Home Buyers' Program (Down Payment Assistance Program) helps income-eligible first-time buyers with up to $15,000 toward down payment and eligible closing costs to purchase a home within Mobile city limits. Funds are a HUD HOME-funded forgivable loan, fully forgiven if the buyer occupies the home as their primary residence for five years. All applicants must complete at least 8 hours of pre-purchase homeowner counseling, and the home must pass an HQS inspection.
• Up to $15,000 for down payment and eligible closing costs.
• 0% interest, forgiven after 5 years of owner-occupancy.
• Covers single-family, condo, duplex, and modular homes.
• Pre-purchase counseling provided through local HUD-approved partners.
• Funding comes from U.S. Department of Housing and Urban Development (HUD) HOME Investment Partnerships Program.

How much assistance does it provide?

Down Payment Assistance Program (City of Mobile) offers up to $15,000 in assistance.

• The program can be combined with other assistance, subject to the rules of each.
• Amounts are the program's published maximums, not an offer — City of Mobile Community & Housing Development Department determines any individual award.

Do you have to pay it back?

Down Payment Assistance Program (City of Mobile) is forgiven after 5 years, so a buyer who stays that long does not repay it.

• Repayment is triggered by Pro-rata repayment if the homeowner does not maintain the home as their primary residence for the full five-year period.
• The assistance is recorded in Second position.
• Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

Down Payment Assistance Program (City of Mobile) is open to first-time homebuyers and buyers who will live in the home as their primary residence.

What are the income limits?

Down Payment Assistance Program (City of Mobile) limits household income to 80% of the area median income, which varies by county and household size.

• HUD income limits effective 6/1/2025 (household must earn less than): 1 person $45,650; 2 $52,200; 3 $58,700; 4 $65,200; 5 $70,450; 6 $75,650; 7 $80,850; 8 $86,100.
• The limit applies to total household income, not only the borrower’s.
• Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

What kind of home can it be used for?

Down Payment Assistance Program (City of Mobile) caps the purchase price at $193,000.

• Eligible property types include Single Family, Condo, Duplex, and Modular.
• New construction is eligible.
• Manufactured homes are not eligible.

Where does it apply?

Down Payment Assistance Program (City of Mobile) serves buyers purchasing in Mobile, Alabama.

How do you apply?

Applications for Down Payment Assistance Program (City of Mobile) go through City of Mobile Community & Housing Development Department, which publishes the current terms and the application steps on its own site.

1. 1

   Take a homebuyer education course

   Required by the program, through Consumer Credit Counseling Services of Mobile (251-602-0011); Legal Services Alabama (251-433-6560 ext. 3429). HUD requires at least 8 hours of approved pre-purchase counseling..

2. 2

   Contact City of Mobile Community & Housing Development Department to reserve funds

   Funds are reserved through Applications through the City of Mobile Community & Housing Development Department after completing homebuyer counseling., and are subject to availability.

3. 3

   Work with a lender who handles the program

   Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.