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Alabama Mortgage Rates

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Use SmartAsset's mortgage rate comparison tool to compare mortgage rates from the top lenders and find the one that best suits your needs.

Overview of Alabama Mortgages

In a state lineup, Alabama ranks nearly dead center in terms of population size. This southern state’s mortgage market follows suit, coming in right around average compared to historical national rates. For the most part, Alabama counties’ conforming loan limits and FHA loan limits also hover at the average.

Today's Mortgage Rates in Alabama

Product Today Last Week Change
30 year fixed 4.88% 4.49% +0.38
15 year fixed 4.00% 3.63% +0.38
5/1 ARM 4.63% 2.00% +2.63
30 yr fixed mtg refi 5.99% 5.88% +0.12
15 yr fixed mtg refi 5.10% 5.24% -0.14
7/1 ARM refi 4.75% 4.75% 0.00
15 yr jumbo fixed mtg refi 3.09% 3.11% -0.02

National Mortgage Rates

Source: Freddie Mac Primary Mortgage Market Survey, SmartAsset Research
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Historical Mortgage Rates in Alabama

Photo Credit: ©iStock.com/Peeter Viisimaa

Alabama Mortgage Rates Quick Facts

  • Median Home Value: $154,000 (U.S. Census Bureau)
  • Loan Funding Rate: 55.80% (CFPB)
  • Homeownership Rate: 74.8% (St. Louis Fed)
  • Median Monthly Homeownership Costs: $1,186 (U.S. Census Bureau)

Alabama mortgage rates generally align closely with the national average. Homeownership costs in the state are also lower than the national median, which is $1,595.

A financial advisor in Alabama can help you plan for the homebuying process. Financial advisors can also help with investing and financial plans, including tax, retirement and estate planning, to make sure you are preparing for the future.

Alabama Historic Mortgage Rates*

YearAlabama RateU.S. Rate
20008.087.86
20016.936.94
20026.546.44
20035.755.67
20045.895.68
20055.985.85
20066.736.54
20076.546.42
20086.026.06
20094.935.05
20104.784.81
20114.514.56
20123.643.65
20133.893.84
20144.234.13
20153.963.88
20163.813.73
20174.194.03
20184.714.56

*The FHFA stopped reporting new data in 2018.

Alabama Mortgages Overview

Alabama is one of the more affordable states to purchase a home. The median home value here is $154,000, well under the corresponding national figure of $240,500.

Every county in the state has a standard conforming loan limit of $647,200. The data once again puts Alabama at an average, affordable level compared to the rest of the country. Every county also has the standard FHA limit of $420,680.

Conforming and FHA Loan Limits by County

CountyConforming LimitFHA Limit
Autauga$647,200$420,680
Baldwin$647,200$420,680
Barbour$647,200$420,680
Bibb$647,200$420,680
Blount$647,200$420,680
Bullock$647,200$420,680
Butler$647,200$420,680
Calhoun$647,200$420,680
Chambers$647,200$420,680
Cherokee$647,200$420,680
Chilton$647,200$420,680
Choctaw$647,200$420,680
Clarke$647,200$420,680
Clay$647,200$420,680
Cleburne$647,200$420,680
Coffee$647,200$420,680
Colbert$647,200$420,680
Conecuh$647,200$420,680
Coosa$647,200$420,680
Covington$647,200$420,680
Crenshaw$647,200$420,680
Cullman$647,200$420,680
Dale$647,200$420,680
Dallas$647,200$420,680
De Kalb$647,200$420,680
Elmore$647,200$420,680
Escambia$647,200$420,680
Etowah$647,200$420,680
Fayette$647,200$420,680
Franklin$647,200$420,680
Geneva$647,200$420,680
Greene$647,200$420,680
Hale$647,200$420,680
Henry$647,200$420,680
Houston$647,200$420,680
Jackson$647,200$420,680
Jefferson$647,200$420,680
Lamar$647,200$420,680
Lauderdale$647,200$420,680
Lawrence$647,200$420,680
Lee$647,200$420,680
Limestone$647,200$420,680
Lowndes$647,200$420,680
Macon$647,200$420,680
Madison$647,200$420,680
Marengo$647,200$420,680
Marion$647,200$420,680
Marshall$647,200$420,680
Mobile$647,200$420,680
Monroe$647,200$420,680
Montgomery$647,200$420,680
Morgan$647,200$420,680
Perry$647,200$420,680
Pickens$647,200$420,680
Pike$647,200$420,680
Randolph$647,200$420,680
Russell$647,200$420,680
St. Clair$647,200$420,680
Shelby$647,200$420,680
Sumter$647,200$420,680
Talladega$647,200$420,680
Tallapoosa$647,200$420,680
Tuscaloosa$647,200$420,680
Walker$647,200$420,680
Washington$647,200$420,680
Wilcox$647,200$420,680
Winston$647,200$420,680

It’s important to note that Alabama is a “caveat emptor," which is also known as a “buyer beware” state. That means responsibility falls heavily on the buyer to uncover any defects with the property prior to purchasing. Property inspections are an incredibly valuable tool to verify a property’s conditions before purchase. Home inspections are not mandatory, but they are absolutely critical to the integrity of a purchase. Following through on a sale without an inspection generally means a buyer is accepting the property as-is.

30-Year Fixed Mortgage Rates in Alabama

Fixed-rate mortgages tend to be the best mortgage option for buyers who plan to stay in their home for the long haul. As a result, 30-year fixed-rate mortgages are the most common type of home loan. Rates are reasonable and you’re guaranteed the same principal and interest payment over the life of the loan. Another option is a 15-year fixed-rate mortgage, a loan that generally comes with lower interest rates than the 30-year alternative. However, your monthly payments will be higher with this option.

The average 30-year fixed mortgage rate in Alabama is 3.49% (Zillow, Jan. 2022).

Alabama Jumbo Loan Rates

Homes in Alabama tend to be on the more affordable end. Because of that, there are fewer jumbo loan mortgages in Alabama. These type of loans exceed the $647,200 conforming loan limit that exists in every Alabama county. If you’re considering a jumbo loan for your mortgage, be aware that they come with higher interest rates.

Conforming loan limits exist because issuing a loan beyond that price is riskier for lenders. There is more money at stake, so the higher mortgage interest rate on jumbo loans is meant to compensate for the added risk.

The average rate for a 30-year fixed jumbo mortgage in Alabama is 3.37% (Zillow, Jan. 2022).

Alabama ARM Loan Rates

An ARM is an adjustable-rate mortgage that typically offers a lower interest rate upfront than a fixed-rate mortgage. The lower rate is available for an initial, introductory period that may last for 1, 3, 5, 7 or 10 years, depending on the terms of the loan. After that initial period, the mortgage interest rate can “adjust” once a year. Generally, the rate increases.

The good news is that there’s an interest rate cap specified in the loan’s terms, which protects you from that scenario. So you will know upfront what the highest possible rate could be.

However, the loan rate may still adjust to a level that you can’t afford. Before deciding on an ARM, it’s best to assess the potential maximum interest rate listed in the terms to see if it’s something you would be comfortable paying.

The average rate for an 5/1 ARM in Alabama is 2.75% (Zillow, Jan. 2022).

Alabama Mortgage Resources

If you need help with your Alabama mortgage, there are resources available for you. The Alabama Housing Finance Agency (AHFA) offers two programs to help you get started. The Step Up program was designed to help mid-range homebuyers who can afford a mortgage, but need more assistance with their down payment. The funds for the down payment are secured with a second mortgage and combined with a standard 30-year fixed-rate mortgage.

The AHFA also offers a Mortgage Credit Certificate, which reduces homebuyers’ federal income tax to free up income for a mortgage qualification.

If you’re struggling with your mortgage and are concerned you might go into foreclosure, the Hardest Hit Alabama program can help. Eligible homeowners can receive unemployed or underemployed mortgage help, loan modification and lien extinguishment.

Available Resources

ResourceProblem or IssueWho Qualifies
Alabama Housing Finance AuthorityOffers down payment assistance, affordable loans and a mortgage credit certificate.First or repeat homebuyers who are eligible.
Hardest Hit AlabamaForeclosure protection.At-risk homeowners who need help keeping their homes.
USDA Rural Development - Single family loansOffers low-interest loans to buy, build, repair, or own safe and affordable homes in rural America.Applicants must be without decent, safe and sanitary housing; Be unable to obtain a loan from other resources on terms and conditions that can reasonably be expected to meet; Agree to occupy the property as your primary residence; Have the legal capacity to incur a loan obligation; Meet citizenship or eligible noncitizen requirements; Not be suspended or debarred from participation in federal programs.

In Alabama, you may also qualify for assistance from the United States Department of Agriculture Rural Development. The program is intended to help rural communities by offering aid in securing safe, affordable housing. Loans and grants are available for people looking to purchase a new home or repair their current home.

Alabama Mortgage Taxes

Homeowners are allowed to deduct the mortgage interest they pay when they file their federal income taxes. This applies for Alabama state income taxes as well. You can double your deductions for the qualifying mortgage interest payments you have made in the tax year by including it on both state and federal filings.

Alabama also charges taxes on real estate property title transfers. The state real estate transfer tax for Alabama is $0.50 per $500 of transferred value. In Alabama, the buyer typically pays this tax. You’ll want to discuss this tax with your lawyer or accountant before buying.

Alabama Mortgage Refinance

While the Home Affordable Refinance Program (HARP) no longer exists, there is an alternative: the High Loan-to-Value Refinance Option from Fannie Mae.