Today’s AL Mortgage and Refinancing Rates

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Mortgage rates in Alabama today

mortgage term Average mortgage rate Average refinancing rate
This information was provided by Zillow. See more
mortgage rates on Zillow

Buying a home in Alabama

Corresponding Zilow, the typical home value in Alabama is less than the national home value of $356,026 in the United States. The typical home value in Alabama is $211,090 and home values ​​have increased by 16.7% over the past year.

Historical mortgage rates for Alabama

If you look at average mortgage rates in Alabama since 2010, you can see trends for 30-year fixed-rate mortgages, 15-year fixed-rate mortgages, and 7/1 variable-rate mortgages:

When you see how today’s interest rates compare to historical mortgage rates in Alabama, you can decide if you would get a good deal with a mortgage or refinance now.

mortgage calculator

To see how today’s mortgage rates could affect your monthly payments, check out our free mortgage calculator.

mortgage calculator

$1.161
Your estimated monthly payment

  • Pay a 25% you would save yourself a higher down payment $8.916,08 on interest charges
  • interest rate reduction 1% would save you $51.562,03
  • pay surcharge $500 each month would shorten the loan term by 146 Sweet

Click More Details for savings tips and insights into how interest rates affect your long-term finances.

Programs for first-time home buyers in Alabama

That Housing Finance Administration of Alabama provides financial assistance to inexperienced homebuyers. You can combine all three funding programs. Get your mortgage through an AHFA participating lender and apply to one of the following programs:

  • climb up: Receive 3% of your mortgage amount as a down payment assistance loan on a conventional mortgage or 3.5% on an FHA mortgage.
  • Affordable Income Subsidy: You can get additional financial assistance for graduation costs if you meet the income requirements and you don’t have to pay the money back.
  • Mortgage Credit Certificates: Receive a tax credit equal to 50% of the interest you pay on your mortgage, up to $2,000 per year.
  • Federal Housing Administration mortgage: Also known as an FHA loan, this loan allows you to get a 3.5% down payment with a credit score of at least 580 or a mortgage with a credit score between 500 and 580 with a 10% down payment.
  • US Department of Agriculture Mortgage: Also known as USDA loans, these loans can be useful if you are a low- to middle-income borrower looking to buy a home in a rural or suburban area.
  • Veterans Affairs Mortgage: These mortgages, also known as VA loans, are for active military members or veterans or spouses of deceased members and can offer lower interest rates than traditional mortgages.

Refinance your mortgage in Alabama

Interest rates are currently at an all-time low, so it might be worth swapping your current mortgage for one with a lower interest rate – especially if the new interest rate would be significantly lower.

You don’t necessarily have to refinance with the same lender that you used for your original mortgage. Another company might offer you a better deal this time. Look for a lender that offers the lowest interest rate based on your credit history and debt-to-income ratio, and charges relatively low fees.

This is how you get low interest rates

Here are some tips to get a good interest rate on your mortgage:

  • Save for a deposit. With a traditional loan, you may only be able to repay 3%. But the higher your deposit, the lower your rate is likely to be. Interest rates should stay low for a while, so you probably have time to save more.
  • Increase your credit score. Many lenders require a minimum credit rating of 620 to obtain a mortgage. But the higher your score, the better your guess will be. To improve your credit score, make sure you pay all your bills on time. You can also pay off debt or age your credit.
  • Lower your debt to income ratio. Your DTI is the amount you pay in debt each month divided by your gross monthly income. Most lenders want to see a DTI of 36% or less, but an even lower DTI can result in a better rate. To improve your DTI, pay off debt, or see if you can make more money.
  • Choose a government secured mortgage. If you are eligible, you can get a USDA loan (for low- to middle-income borrowers who are buying in a rural area), a VA loan (for military members and veterans), or an FHA loan (not intended for a specific group). ) consider ). These loans typically carry lower interest rates than traditional mortgages. As a bonus, you don’t need a down payment on USDA or VA loans.

Improving your financial situation and choosing the right type of mortgage for your needs can help you get the best interest rate possible.

Mortgage Resources in Alabama

Learn more about the programs offered to first-time home buyers in Alabama

Check out the Alabama mortgage loan limits by county in 2022

Mortgage and refinancing rates by state

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