The 1988 session of the General Court appropriated the initial $4,000,000 for acquisition, development, and preservation of low-income housing. This initial appropriation was entirely committed by 1989. However, this fund has been replenished through program income, tax-exempt bond fees, earnings, and, in 2002, with a state appropriation of $5 million recapitalization of the Fund.

The fund is used to provide loans and grants to support rental housing, group homes, and manufactured housing cooperatives. Funds are typically reserved for below market rate loans or grants to cover financing gaps or fund projects that cannot support debt. Both for and non-profit sponsors are eligible for financing. 

Minimum requirements are that 50% of the units in a project must be affordable to households at 80% or less of the Median Area Income. Typically, projects financed by the AHF have other funding programs, the most common being tax credits. These other programs generally have more restrictive affordability requirements.