Mortgage rates in Alabama
30-yr fixed 7.18% · Freddie Mac PMMS, week of Nov 5, 2026 · APR benchmark 7.19% (APOR for locks from Nov 9, 2026) · Last reviewed Oct 18, 2026 by the Editorial Team
Alabama has one of the lowest effective property-tax rates in the country.
Mortgage rates today by loan type
These are national averages. Lenders in Alabama price off the same national market, so treat them as a benchmark: your quote depends on your credit, down payment, loan size and points. The APR benchmark folds in typical points and fees, so it shows what a prime borrower's APR looks like this week.
| Loan type | Avg rate | APR benchmarkAPOR | Source · as of | What it measures |
|---|---|---|---|---|
| 30-year fixed | 7.18% | 7.19% | Freddie Mac PMMSNov 5, 2026 | Conventional purchase loans, 20% down, strong credit; weekly survey |
| 20-year fixed | 6.66% | 6.93% | Zillow (via NerdWallet)Nov 6, 2026 | Lender-quoted average; checked by hand every two weeks |
| 15-year fixed | 6.57% | 6.67% | Freddie Mac PMMSNov 5, 2026 | Conventional purchase loans, 20% down, strong credit; weekly survey |
| 10-year fixed | 6.31% | 6.82% | Zillow (via NerdWallet)Nov 6, 2026 | Lender-quoted average; checked by hand every two weeks |
| 5-year ARM | 6.73% | 6.67% | Zillow (via NerdWallet)Nov 6, 2026 | Fixed for 5 years, then adjusts; APOR = prime ARM benchmark |
| 7-year ARM | — | 6.50% | APOR, locks from Nov 9, 2026 | No free rate series; APOR benchmark only |
| 10-year ARM | — | 6.63% | APOR, locks from Nov 9, 2026 | No free rate series; APOR benchmark only |
| FHA 30-year | 6.89% | — | Optimal Blue OBMMINov 5, 2026 | Locked FHA loans, all credit profiles; daily |
| VA 30-year | 6.71% | — | Optimal Blue OBMMINov 5, 2026 | Locked VA loans; daily |
| USDA 30-year | 6.86% | — | Optimal Blue OBMMINov 5, 2026 | Locked USDA loans; daily |
| Jumbo 30-year | 7.25% | — | Optimal Blue OBMMINov 5, 2026 | Locked loans above the conforming limit; daily |
APR benchmark = FFIEC/CFPB Average Prime Offer Rate for rate locks in the week starting Nov 9, 2026 (published in advance): a prime borrower's APR including typical points and fees. It is not a quote; your APR depends on credit, down payment and the points you pay. APOR is not published for FHA, VA, USDA or jumbo loans.
Calculate your Alabama mortgage payment
The calculator starts from Alabama's median list price, 20% down, the state's 0.42% effective property tax, its median insurance premium and its average closing costs. Switch to FHA or VA, change the down payment, or pick your county to set its conforming limit. For the month-by-month split of principal and interest, open the full payoff schedule. To see how Alabama's property tax and insurance compare with every other state, try the full PITI calculator.
Alabama vs. the U.S.
Alabama's median list price is 22% below the U.S. median, so at the same 7.18% rate the principal and interest on a 20%-down loan runs $488 a month less. Five-year price growth here was the 24th-fastest of 51 jurisdictions.
| Measure | Alabama | U.S. |
|---|---|---|
| Median list priceRealtor.com, Oct 2026 | $324,900 | $415,000 |
| Principal + interest, 20% down30-yr avg 7.18% | $1,761 | $2,249 |
| Average home-purchase loanHMDA 2025 | $277,871 | $404,828 |
| Average closing costsincl. transfer taxes | $2,791 | $4,661 |
| Median conventional rate paid2025 purchase loans | 6.50% | 6.50% |
| Mortgage approval rateHMDA 2025 | 73.6% | 76.6% |
| Home values, 1 yearFHFA index, Q2 2026 | +3.7% | +3.0% |
| Home values, 5 yearsFHFA index, Q2 2026 | +43.8% | +41.3% |
What Alabama borrowers actually paid in 2025
This is the state-specific part. Federal HMDA records show the rate and costs on every Alabama home-purchase loan closed in 2025. We compare like with like: 30-year fixed, first-lien, one-unit primary homes. On conventional loans, Alabama borrowers paid 0.01 percentage points above the market benchmark at lock, the 25th-lowest of all 50 states and the District of Columbia.
| 2025 purchase loans | Median rateAL · U.S. | Over benchmarkAL · U.S. | Closing costsAL · U.S. | Paid pointsshare of loans | Median downequity on refis · AL |
|---|---|---|---|---|---|
| Conventional 30-yr fixed (conforming, 20%+ down)8,443 loans | 6.50%6.50% | +0.01+0.02 | $4,303$5,476 | 55.9%53.2% | 25% |
| Jumbo 30-yr fixed (20%+ down)101 loans | 6.63%6.63% | +0.06+0.00 | $5,792$10,251 | 37.6%38.4% | 20% |
| FHA 30-yr fixed12,859 loans | 6.13%6.25% | +0.37+0.42 | $8,692$11,291 | 56.1%59.3% | 3.5% |
| VA 30-yr fixed7,783 loans | 6.13%6.13% | −0.34−0.36 | $5,139$6,554 | 61.0%59.3% | 0% |
| Conventional rate-and-term refinance1,768 loans | 6.49%6.38% | +0.01−0.06 | $5,066$4,390 | 53.1%45.4% | 32.7% |
Source: 2025 HMDA loan-level records (FFIEC/CFPB), medians. "Over benchmark" = rate spread, the APR minus APOR on the lock date, which removes the effect of when each loan locked. Closing costs = total loan costs on the Closing Disclosure. HMDA has no credit scores, so these are what borrowers paid, not what you will be offered. See the lenders active in Alabama and what their borrowers paid.
Alabama's biggest conventional lenders: what their borrowers paid
The 8 largest conventional lenders in Alabama by 2025 purchase loans, out of 745 that made one. Each row is the median for that lender's comparable loans here: 30-year fixed, conforming, 20% or more down. A lower figure over the benchmark means cheaper pricing for the same week.
| Lender | 2025 loansshare in AL | Median rate | Over benchmark | Originationmedian | Paid pointsshare · median | Median down |
|---|---|---|---|---|---|---|
| United Wholesale Mortgage | 1,3613.9% | 6.50% | −0.02 | $3,016 | 55%$1,697 | 21% |
| Vanderbilt Mortgage And Finance, Inc. | 1,2293.5% | 6.49% | −0.01 | $1,495 | 56%$3,518 | 24.6% |
| Trustmark National Bank | 1,1803.4% | 6.63% | +0.01 | $1,545 | 43%$1,269 | 25% |
| Rocket Mortgage | 1,0593% | 6.50% | +0.04 | $3,483 | 81%$2,935 | 23.4% |
| FirstBank | 9652.8% | 6.50% | −0.03 | $1,600 | 54%$1,709 | 25% |
| Regions Bank | 9062.6% | 6.50% | −0.03 | $1,800 | 72%$1,551 | 25% |
| Fairway Independent Mortgage | 8462.4% | 6.88% | +0.27 | $1,940 | 60%$1,328 | 25% |
| Cadence Bank | 7952.3% | 6.63% | −0.04 | $1,706 | 60%$1,780 | 25.7% |
Source: 2025 HMDA loan-level records (FFIEC/CFPB), lenders with at least 30 comparable loans in Alabama. Minimum credit scores are not shown here: conventional loans usually start at 620 (a lender floor; Fannie Mae's automated underwriting sets none), FHA 580 (500 with 10% down), VA none set by VA (lenders often 620). HMDA has no credit scores, so a lender's medians reflect its own mix of borrowers. FHA and VA lenders: Alabama lender rankings.
How rates have moved
Weekly national averages over the past 30 days to 5 years. The 30- and 15-year lines are Freddie Mac average rates; the ARM lines are the APOR APR benchmark, because no free weekly ARM rate series exists.
- Now
- 7.18%
- Nov 5, 2026
- 1 week ago
- 7.24%
- −0.06 pts
- 1 month ago
- 7.40%
- −0.22 pts
- 1 year ago
- 6.22%
- +0.96 pts
30-year fixed: Freddie Mac PMMS (rate), weekly. National series.
What a mortgage costs in Alabama
On a home at Alabama's median list price of $324,900 with 20% down, the mortgage totals $259,920, or about $1,761 a month in principal and interest at the 7.18% 30-year average.
What makes Alabama different is the cost around the loan. Its 0.42% effective property-tax rate adds roughly $114 a month, and homeowners insurance — at the state's median 0.60% of home value — about $163 more, bringing the all-in estimate to $2,037. That figure is principal and interest at the 30-year average, property tax and insurance; at 20% down a conventional loan has no PMI, and HOA dues or local special assessments are not included. Your own price and down payment will move the number — work backward from your income with the home-price affordability tool.
Payment at the $324,900 median list price by down payment and loan type
| Loan | Rate | Monthlyall-in | Mortgage ins. | Cash to close | Income needed28% rule · yearly |
|---|---|---|---|---|---|
| Conventional, 20% downNo PMI | 7.18%Freddie Mac 30-yr avg | $2,037P&I $1,761 | — | $67,771 | $87,000 |
| Conventional, 10% downPMI est. 0.7%/yr | 7.18%Freddie Mac 30-yr avg | $2,428P&I $1,981 | $171 | $35,281 | $104,000 |
| Conventional, 5% downPMI est. 0.7%/yr | 7.18%Freddie Mac 30-yr avg | $2,548P&I $2,091 | $180 | $19,036 | $109,000 |
| Conventional, 3% downPMI est. 0.7%/yr | 7.18%Freddie Mac 30-yr avg | $2,596P&I $2,135 | $184 | $12,538 | $111,000 |
| FHA, 3.5% down1.75% upfront MIP financed + annual MIP | 6.89%OBMMI FHA avg | $2,519P&I $2,099 | $144 | $14,163 | $108,000 |
| VA, 0% down2.15% funding fee financed; no monthly MI | 6.71%OBMMI VA avg | $2,420P&I $2,144 | — | $2,791 | $104,000 |
Monthly = principal and interest + property tax (0.42% effective) + homeowners insurance (about $163/mo — Alabama's median premium, 0.60% of home value) + mortgage insurance. HOA dues and local special assessments are not included. Cash to close = down payment + Alabama's average closing costs ($2,791). PMI is an illustrative 0.7% a year; FHA and VA figures use HUD's MIP schedule and VA's first-use funding fee. Income needed = the gross yearly income at which the monthly figure is 28% of pay, the classic housing-cost guideline. Lenders also limit your total monthly debts as a share of income, so car, student-loan and card payments raise the income you need.
Prices, loan limits and payments in Alabama's biggest counties
Home prices, and so the loan you need, vary more inside Alabama than rates do. The table covers the largest county markets. Pick a row to load it into the calculator above.
| County | Median list priceSep 2026 · yr/yr | Avg purchase loanHMDA 2025 | Conforming limitmax price at 20% down | At 20% down | Est. paymentP&I + tax + ins. | Calculator |
|---|---|---|---|---|---|---|
| Baldwin County2,838 homes for sale · Sep 2026 | $499,000-0.2% | $362,8305,363 loans | $832,750$1,040,937 | Conforming$399,200 loan | $3,129at 7.18% | |
| Jefferson County2,767 homes for sale · Sep 2026 | $229,925-6.1% | $312,3257,440 loans | $832,750$1,040,937 | Conforming$183,940 loan | $1,442at 7.18% | |
| Madison County2,227 homes for sale · Sep 2026 | $350,000-2.8% | $320,0916,816 loans | $832,750$1,040,937 | Conforming$280,000 loan | $2,195at 7.18% | |
| Mobile County1,351 homes for sale · Sep 2026 | $259,950-1.9% | $249,9484,254 loans | $832,750$1,040,937 | Conforming$207,960 loan | $1,630at 7.18% | |
| Shelby County1,012 homes for sale · Sep 2026 | $399,125-0.7% | $333,9723,649 loans | $832,750$1,040,937 | Conforming$319,300 loan | $2,503at 7.18% | |
| Montgomery County959 homes for sale · Sep 2026 | $225,000-5.2% | $228,0512,534 loans | $832,750$1,040,937 | Conforming$180,000 loan | $1,411at 7.18% | |
| Lee County950 homes for sale · Sep 2026 | $403,671+0.3% | $368,1272,798 loans | $832,750$1,040,937 | Conforming$322,937 loan | $2,531at 7.18% | |
| Limestone County949 homes for sale · Sep 2026 | $397,725-6.4% | $320,0412,468 loans | $832,750$1,040,937 | Conforming$318,180 loan | $2,494at 7.18% | |
| Tuscaloosa County847 homes for sale · Sep 2026 | $336,604+2.2% | $283,0032,684 loans | $832,750$1,040,937 | Conforming$269,283 loan | $2,111at 7.18% | |
| Cullman County532 homes for sale · Sep 2026 | $319,475-2.8% | $241,7461,137 loans | $832,750$1,040,937 | Conforming$255,580 loan | $2,003at 7.18% | |
| Marshall County502 homes for sale · Sep 2026 | $393,725+12.5% | $265,9761,106 loans | $832,750$1,040,937 | Conforming$314,980 loan | $2,469at 7.18% | |
| Lauderdale County445 homes for sale · Sep 2026 | $314,350-7.2% | $246,9611,122 loans | $832,750$1,040,937 | Conforming$251,480 loan | $1,971at 7.18% |
Sources: Realtor.com county research data (median listing price, Sep 2026); FHFA 2026 one-unit conforming limits; 2025 HMDA home-purchase originations (average loan, all loan types). Payments use the 30-year average (7.18%, or the jumbo average 7.25% above the limit), Alabama's 0.42% effective property tax and its median insurance premium (0.60% of value), both from Census ACS 2024 data; county tax rates differ. Max price at 20% down = the county limit ÷ 0.8, the highest price at which a 20%-down loan stays conforming. Homes for sale = active Realtor.com listings in the month, excluding pending sales.
What's different about buying a home in Alabama
Rates are national, but the rules around the loan are not. These Alabama specifics can change your payment, your closing or your protections as a borrower.
7% cap on assessed value resets at sale
Alabama limits annual increases in the taxable assessed value of owner-occupied homes to 7%, but a change in ownership generally resets it to the true assessed value. Don't assume the seller's tax bill will carry over; the limits are scheduled to continue through the fiscal year beginning October 1, 2027.
Source: revenue.alabama.govHomes assessed at 10% of market value
Alabama assesses single-family, owner-occupied homes (Class III) at 10% of appraised market value, with a state rate of 6.5 mills; county millage varies by taxing jurisdiction. Homestead owners under 65 are exempt from state property tax on up to $4,000 of assessed value.
Source: revenue.alabama.govPost-foreclosure redemption: 180 days or one year
After a foreclosure sale, the borrower may generally redeem within 180 days if the property is residential with a homestead exemption claimed in the year of the sale; for other property the window is one year. Lenders must mail a redemption-rights notice at least 30 days before foreclosing on such a home.
Source: alison.legislature.state.al.usAlabama law requires FORTIFIED retrofit discounts
Alabama law generally requires insurers to give a premium discount or rate reduction to owners who retrofit a home to Institute for Business and Home Safety (IBHS) Fortified Home standards, but only on policies that provide wind coverage. The owner must present the IBHS certification to the insurer before the discount takes effect.
Source: alison.legislature.state.al.usAlabama is a buyer-beware state
Alabama is a caveat emptor state for existing homes. The Alabama Real Estate Commission says that, unless asked, neither the seller nor the seller's agents must disclose defects, except those posing an immediate health or safety risk, so buyers should perform their due diligence.
Source: arec.alabama.govChecked against official sources on October 20, 2026. Laws and programs change; confirm details with the agency named or a local real estate attorney.
How Alabama buyers finance their homes
USDA loans are where Alabama stands out: they made up 1.6% of home loans originated here in 2025, against 0.6% nationally — the 6th-highest USDA share of any state. Lenders, agents and appraisers here handle USDA deals routinely, which helps if that is the loan you need.
| Loan type | Share in AL | U.S. share | Approval in AL | Avg loan in AL |
|---|---|---|---|---|
| Conventional | 67.7% | 78.0% | 71.4% | $231,150 |
| FHA | 17.9% | 13.2% | 76.4% | $243,714 |
| VA | 12.9% | 8.2% | 81.8% | $329,669 |
| USDA | 1.6% | 0.6% | 84.6% | $213,315 |
The average Alabama home loan in 2025 was $245,790 — 30% below the U.S. average of $352,861, the 11th-smallest of 51 jurisdictions. Home purchases accounted for 65.7% of those loans (U.S. 64.2%); cash-out refinances for 15.9% (U.S. 17.1%).
Source: 2025 HMDA originations, FFIEC/CFPB. Approval = originated ÷ (originated + denied).
Alabama loan limits for 2026
All 67 of Alabama's counties use the 2026 baseline conforming limit of $832,750 for a one-unit home. Any loan above that is a jumbo loan here, which usually means a larger down payment and cash reserves. See the full national grid in our full FHFA limit schedule.
County limits: FHFA 2026 conforming loan limit list (one-unit properties; two- to four-unit limits are higher).
Cash you'll need to close in Alabama
Average closing costs in Alabama are about $2,791 including transfer taxes (No. 39 of 51, highest first). On a home at the median list price of $324,900:
| 20% down | 3% down | |
|---|---|---|
| Down payment | $64,980 | $9,747 |
| Average closing costs | $2,791 | $2,791 |
| Cash to close (estimate) | $67,771 | $12,538 |
Prepaid taxes and insurance are extra. Closing-cost averages by state (source: Bankrate).
Transfer taxes and recording rules in Alabama
Alabama charges a deed tax of $0.50 per $500 of value ($1 per $1,000) and a mortgage tax of $0.15 per $100 of the loan amount, both collected by the county probate judge at recording. On a $300,000 loan the mortgage tax alone is about $450. Source: revenue.alabama.gov
Getting approved in Alabama
Federal HMDA lending records show Alabama lenders originated 115,118 home loans in 2025 and denied 41,252 applications — an approval rate near 73.6% among decisioned applications, against 76.6% nationwide. See how all 50 states compare in our nationwide approval report, and how Alabama ranks for complaint rankings (4,423 on record).
Shopping for a loan? See the most active mortgage lenders in Alabama, ranked by federal HMDA volume.
Down-payment help in Alabama
You rarely need 20% down. These are the main programs from AHFA, Alabama's housing finance agency; they are offered through participating lenders, usually alongside the agency's own first mortgage.
Step Up
A 30-year fixed first mortgage paired with down-payment assistance of 4% of the sales price, capped at $10,000, carried as a 10-year second mortgage. It is not limited to first-time buyers; a 640 credit score, a debt-to-income ratio of 45% or less and a homebuyer-education course are required.
Source: ahfa.comFirst Step
A first-mortgage program funded by mortgage revenue bonds for first-time buyers, with income and purchase-price limits.
Source: ahfa.comChecked against official sources on October 9, 2026. Assistance amounts, income limits and funding change during the year — confirm current terms with AHFA or a participating lender.
Alabama's MCC program: closed since October 31, 2025
AHFA sunset its MCC program: no new commitments after October 31, 2025, and certificates had to be issued by December 31, 2025. It says it hopes to relaunch when bond cap allows. Mortgage credit certificates by state.
Check current terms at AHFA, see how a smaller down payment changes your number with the how-much-down calculator, or compare the full state-by-state directory.
How these numbers are measured
- Freddie Mac PMMS (30- and 15-year): a weekly average of rates offered to borrowers with 20% down and strong credit, published Thursdays; latest week Nov 5, 2026. Points are not reported.
- Optimal Blue OBMMI (FHA, VA, USDA, jumbo): daily averages of rates actually locked, across credit profiles. Points vary by loan.
- APOR (APR benchmark): FFIEC/CFPB's weekly Average Prime Offer Rate, an APR that includes typical points and fees for a prime borrower. Regulators use it to flag higher-priced loans.
- HMDA 2025 (Alabama vs U.S.): rates, costs, points and down payments on loans that actually closed, reported by lenders to federal regulators. Updated once a year.
- Census ACS 2024 (property tax and insurance): what homeowners with a mortgage in Alabama reported paying — the median real-estate tax divided by the median home value, and the median insurance premium as a share of value. Updated once a year.
- Interest rate vs APR: the rate sets your payment; the APR adds points and lender fees spread over the loan. Compare APRs on Loan Estimates for the same day and loan type.
Rates and APOR refresh every week; HMDA, loan limits and closing-cost averages refresh when their publishers release new data. Reviewed by our editorial reviewers. Full sources and formulas: source and method details.
Alabama mortgage FAQ
What is a good mortgage rate in Alabama right now?
A 30-year fixed close to the national average of 7.18% (Freddie Mac, week of Nov 5, 2026) is a fair benchmark for a borrower with strong credit and 20% down. In 2025, Alabama's conventional buyers paid a median 6.50%.
Quotes well above that usually reflect lower credit, a small down payment or lender credits taken in exchange for a higher rate.
Are mortgage rates higher in Alabama than in other states?
No, about the same as nationally. In 2025 HMDA records, Alabama's median conventional 30-year rate was 6.50%, against 6.50% nationally.
Against the benchmark for each loan's lock week, which counts points and fees, Alabama loans priced 0.01 percentage points above it (the 25th-lowest of all 50 states and the District of Columbia), against 0.02 above nationally.
Rates are set mainly in one national market, so your credit, down payment and loan size matter more.
What are current jumbo mortgage rates in Alabama?
The national jumbo 30-year average is 7.25% (Optimal Blue). In 2025, Alabama's jumbo buyers paid a median 6.63%. A loan is jumbo above the $832,750 conforming limit, which applies in every Alabama county.
Jumbo lenders typically want 10–20% down, a 700+ credit score and 6–12 months of reserves.
Should I choose a 15-year or 30-year mortgage?
On a $259,920 loan (20% down on Alabama's median list price), a 30-year at 7.18% costs $1,761 a month and a 15-year at 6.57% costs $2,274.
The 15-year saves about $224,529 in interest but needs $513 more a month, so it fits only if that payment is comfortable.
How much does a 1% difference in mortgage rates change my monthly payment?
On a $259,920 loan (20% down on Alabama's median list price), moving from 7.18% to 8.18% raises the principal-and-interest payment from $1,761 to $1,940, or $179 a month.
Over 30 years that is about $64,486 more in interest, which is why comparing several lenders on the same day matters.
Are mortgage rates different for purchase and refinance loans?
Yes, slightly. In 2025, Alabama's conventional rate-and-term refinances closed at a median 6.49% and purchases at 6.50%, partly because refinances bunch up when rates dip. Refinances priced 0.01 percentage points above the market benchmark; cash-out refinances usually cost more. Your own pricing depends on credit, loan-to-value and points.
How much is a $400,000 mortgage at 7.18% interest?
About $2,710 a month in principal and interest over 30 years. In Alabama, a $500,000 home with that loan adds roughly $175 a month in property tax at the 0.42% effective rate, plus homeowners insurance. Over 30 years the loan costs about $575,506 in interest.
How much income do I need to buy a home in Alabama?
About $87,000 a year for a home at the $324,900 median list price with 20% down, if the full $2,037 monthly payment, including tax and insurance, stays within 28% of gross income.
Smaller down payments add mortgage insurance and raise that figure; existing debts lower what lenders approve.
What down payment assistance is available in Alabama?
AHFA, the state housing finance agency, runs Step Up and First Step, offered through participating lenders. Help usually comes as a grant or a deferred or forgivable second loan paired with the agency's first mortgage.
Amounts, income limits and funding change during the year, so confirm current terms with AHFA or a participating lender before you apply.
- Freddie Mac — Primary Mortgage Market Survey
- FFIEC / CFPB — Average Prime Offer Rates (APOR)
- FFIEC / CFPB — HMDA data browser (2025 loan-level records)
- Optimal Blue OBMMI via FRED (FHA, VA, USDA, jumbo)
- FHFA — 2026 conforming loan limits by county
- U.S. Census Bureau — 2024 American Community Survey microdata (property tax and homeowners insurance)
- HUD — Handbook 4000.1 (FHA mortgage insurance)
Rates shown are national weekly averages for general guidance, not an offer or personalized quote. Payment estimates assume the down payment noted plus estimated taxes and insurance. Confirm current pricing with a licensed lender.