AHFA's 2021 Annual Report

Home means many different things to different people. Over the years, we have interviewed homeowners and residents who have benefited from AHFA programs, and we consistently hear that home means security, comfort, and independence. These are significant ideals, and at AHFA, we take seriously our commitment to making home affordable for low- to moderate-income Alabamians and showing them “The Way Home.”

The way home for some may be through our homeownership programs that make buying a home more affordable and open the market to more Alabamians. In FY21, we helped even more Alabamians qualify for our programs by raising the qualifying income from $97,300 to $130,600 for our flagship Step Up down payment assistance program. Also in FY21, we hosted our first Spring Virtual Homeownership Forum. Guest speakers from partner organizations including the Alabama Center for Real Estate, the Home Builders Association of Alabama, and Freddie Mac, as well as experts in the fields of appraisals and mortgage insurance provided a wealth of information for attendees in the mortgage and real estate industries. We hope to make this an annual event due to its success.

The way home is also paved by our multifamily programs that incentivize developers to build quality, affordable rental housing throughout the state. In FY21, we provided more than $54 million in funding awards. Forty percent of this amount went towards properties financed by tax credits, 36 percent to developments financed by a combination of HOME Program funds and tax credits, and 24 percent to developments utilizing Housing Trust Fund allocations. All the while, the Multifamily Division expertly managed changes to the funding cycle due to the COVID-19 pandemic.

For many other Alabamians, AHFA helped them continue to find their same way home in FY21 through administering federal emergency housing assistance programs necessitated by the economic toll of the COVID-19 pandemic. Emergency Rental Assistance Alabama and Mortgage Assistance Alabama have prevented nearly 3,900 evictions and foreclosures, with thousands more slated to receive funding in FY22 and beyond to help them stay in their homes.

We encourage you to explore AHFA’s FY21 accomplishments and listen to the stories of Alabamians who we’ve helped find their way to homes they can afford. We are grateful for the trust placed in us by our partners and thankful for the dedication of our staff. We look forward to continued progress in the year ahead.

We cannot close this letter without observing one of the most remarkable tenures in the history of AHFA. Since 1983, Dr. Shelton E. Allred served as chairman of the AHFA Board of Directors. At his choosing, Dr. Allred presided over his last meeting in December 2021, but he will continue to serve as a board member through his appointed term. In his 38 years of leadership, he led AHFA to many historic milestones, demonstrating an unparalleled devotion to AHFA and the Alabamians who live in safe, decent, and affordable homes thanks to the programs of AHFA. We are fortunate to have enjoyed his guidance and look forward to his continued service on the board. Thank you, Dr. Allred, on behalf of the board and staff of AHFA, and all the Alabamians who have benefited from your service.

LEADERSHIP

AHFA experienced great loss during FY21 due to the passing of board member Tommy Doyal and employee Patsy House. Doyal was a veteran, successful homebuilder, and an integral member of our Board of Directors for 19 years. House worked for 16 years in our mortgage servicing division. She was dedicated to her job and was a beloved and valued employee. We are grateful for their service, and our deepest sympathies and heartfelt thoughts continue to be with their families and friends.

Since 1980, AHFA's versatile, affordable housing programs have helped nearly 75,000 families purchase a home.

Our Step Up down payment assistance program is available to homebuyers who earn $130,600 or less and meet standards for creditworthiness. The program offers a competitive 30-year fixed rate and no sales price limits. In addition to the down payment assistance currently offered through Step Up, qualified buyers are eligible for an Affordable Income Subsidy Grant that helps with closing costs. A Mortgage Credit Certificate (MCC) is also available to qualified homebuyers. An MCC is a dollar-for-dollar annual income tax credit for the life of the loan that increases available income to qualify for a mortgage.

The Step Up program can be combined with an MCC for even greater buying power.

AHFA administers multifamily programs that create quality, affordable rental housing by providing funding and tax incentives that help developers build or rehabilitate properties for Alabama’s low- to moderate-income families.

Since its beginning, AHFA has provided more than $855 million in funding and tax incentives to help build or preserve 724 active developments comprising 38,801 units across the state with an average reported occupancy of 96 percent. Another 82 developments, comprising 4,631 units, are in various stages of completion. AHFA-financed developments can be found in every county in the state.

AHFA is Alabama’s administrator of the federal HOME Investment Partnerships Program (HOME) and Low Income Housing Tax Credit (LIHTC) program, as well as the national Housing Trust Fund. In addition, AHFA issues multifamily housing revenue bonds for the acquisition, renovation and new construction of affordable rental housing.

Emergency Rental Assistance Alabama (ERA Alabama)

In FY21, AHFA was authorized to implement the State’s new COVID-19 emergency rental assistance program, funded by a grant from the U. S. Department of Treasury as part of the Consolidated Appropriations Act of 2021. ERA Alabama helps Alabama renters who are adversely affected by COVID-19 pay past due and future rent and utility bills.

The total Treasury allocation to the state of Alabama was approximately $326 million, of which AHFA received $263 million to administer the state entity program covering 61 counties, Emergency Rental Assistance Alabama. The remainder was allocated directly to local jurisdictions (six counties and two cities) with populations greater than 200,000 to administer in their areas. AHFA worked diligently to get assistance to Alabama families in need. We were one of the first states in the nation to set up a program from scratch, as ERA Alabama went live on March 1. Because we were the first program in the state to launch, we also covered applications from several of the local jurisdictions until their separate programs launched much later.

As the program progressed, we created the Imminent Eviction Prevention Initiative in collaboration with Legal Services Alabama to allow for expedited processing of applications for households facing eviction, usually within 14 days. As of September 30, 194 eviction cases had been funded with another 238 pending expedited processing.

Overall, in FY21, ERA Alabama approved 3,804 applicant households for payment, which consisted of actual disbursements of $23.4 million and a future obligation of payments of $212.9 million.

Mortgage Assistance Alabama (MAA)

In FY21, AHFA was also authorized to administer the Homeowner Assistance Fund appropriated by the U.S. Department of Treasury to help eligible Alabama homeowners facing temporary financial hardships due to COVID-19 keep their home. The program helps homeowners with past due mortgage-related expenses incurred after January 21, 2020, and up to 12 months of expected mortgage expenses. With the encouragement of Treasury, AHFA tested its prototype program, Mortgage Assistance Alabama, by launching it as a pilot program on August 16 limited to customers of ServiSolutions. The pilot program closed on October 1 with 81 homeowners receiving actual disbursements of $468,449 and future committed funding of $4,050,000.

As of September 30, the statewide program was pending final approval by the U.S. Department of Treasury. Once approval is granted, MAA will open to homeowners statewide.

ServiSolutions is the home mortgage loan servicing division of AHFA. In addition to the loans funded by AHFA, ServiSolutions services loans for housing finance agencies in Arkansas, Mississippi, Missouri and North Carolina, as well as community banks in Alabama. ServiSolutions services many different types of mortgages including FHA, VA, Rural Development, conventional uninsured and conventional insured loans.

Audited Financial Statements

The Alabama Housing Finance Authority is a public corporation and instrumentality of the State of Alabama created July 25, 1980, by Act No. 80-565 of the Alabama Legislature.

The bonds of the Alabama Housing Finance Authority are not obligations of the State of Alabama and are not repaid with tax dollars. AHFA is a self-sustaining organization which pays all operating expenses from program revenues.