Getting a conventional loan in Alabama: numbers, limits and rules
A conventional loan in Alabama is priced by Fannie Mae and Freddie Mac’s national rules, then shaped by local facts: a $230,000 median, property tax near 0.4%, attorney closings, and a baseline conforming limit of $832,750. Here are the numbers and the rules, in that order.
| Conforming limit (2026, one unit) | $832,750 baseline — all 67 counties, no FHFA high-cost area |
|---|---|
| Median home price (approx.) | $230,000 — statewide order of magnitude |
| 20% down on the median | $46,000 down, loan $184,000, about $1,163/month P&I at 6.5% |
| 5% down on the median | $11,500 down, loan $218,500, about $1,381/month P&I + about $137 PMI |
| PMI ends (5% down, scheduled payments) | request at 80% after about 10 years and 4 months, automatic at 78% after about 11 years and 3 months |
| Property tax (effective) | about 0.4% — roughly $920 a year on the median |
| Closing practice | Attorney closing state |
How much house stays conforming in Alabama
A conventional loan is conforming when it fits Fannie Mae and Freddie Mac’s limit and their guidelines; in Alabama that limit is $832,750 for a one-unit home in 2026. With 20% down, a purchase up to about $1,040,938 stays conforming; with 5% down, up to about $876,579. The state’s $230,000 median leaves ample room, so a typical purchase here is conforming unless the buyer is in a premium neighborhood. Every Alabama county is in the table below; see conforming loan limits and jumbo loans.
County-level loan limits in Alabama for 2026
For 2026 the FHFA county list shows a single tier in Alabama: all 67 counties at the $832,750 baseline for one unit, $1,066,250 for two units, $1,288,800 for three and $1,601,750 for four. Above those figures a loan is jumbo, whatever the county.
| County | 1 unit | 2 units | 3 units | 4 units |
|---|---|---|---|---|
| Autauga County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Baldwin County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Barbour County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Bibb County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Blount County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Bullock County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Butler County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Calhoun County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Chambers County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Cherokee County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Chilton County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Choctaw County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Clarke County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Clay County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Cleburne County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Coffee County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Colbert County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Conecuh County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Coosa County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Covington County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Crenshaw County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Cullman County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Dale County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Dallas County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Dekalb County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Elmore County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Escambia County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Etowah County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Fayette County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Franklin County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Geneva County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Greene County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Hale County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Henry County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Houston County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Jackson County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Jefferson County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lamar County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lauderdale County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lawrence County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lee County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Limestone County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lowndes County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Macon County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Madison County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Marengo County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Marion County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Marshall County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Mobile County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Monroe County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Montgomery County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Morgan County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Perry County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Pickens County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Pike County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Randolph County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Russell County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Shelby County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| St. Clair County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Sumter County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Talladega County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Tallapoosa County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Tuscaloosa County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Walker County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Washington County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Wilcox County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Winston County | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
Source: FHFA, Conforming Loan Limit Values for 2026 (county list, mortgages acquired in calendar year 2026). Limits are for Fannie Mae and Freddie Mac loans; FHA and VA use their own county figures.
Down payment and monthly payment, four ways
The table assumes Alabama’s $230,000 median, a 6.5% rate chosen for illustration, typical PMI pricing by down payment (your credit score moves it), and the state’s 0.4% effective property tax. Add insurance and HOA dues to get a full payment.
| Down payment | Cash down | Loan | P&I | PMI (est.) | Property tax | Monthly total |
|---|---|---|---|---|---|---|
| 3% | $6,900 | $223,100 | $1,410 | $167 | $77 | $1,654 |
| 5% | $11,500 | $218,500 | $1,381 | $137 | $77 | $1,595 |
| 10% | $23,000 | $207,000 | $1,308 | $86 | $77 | $1,471 |
| 20% | $46,000 | $184,000 | $1,163 | — | $77 | $1,240 |
For other loan amounts and rates, the payment tables show principal and interest, total interest and the PMI break points.
When PMI ends in Alabama
Three dates matter: the month the balance hits 80% of the original price (you ask), 78% (the servicer must act) and the loan’s midpoint (cancellation regardless of value, if current). On Alabama’s median with 5% down at 6.5%, the schedule reaches 80% in about 10 years and 4 months; with 3% down, about 11 years and 1 months; with 10% down, about 7 years and 11 months. Over that time the 5% buyer pays roughly $16,988 in PMI at $137 a month.
The Alabama closing: costs and who runs it
Alabama closings are run by attorneys or by title agencies working under a supervising lawyer, because the Alabama State Bar treats the drafting of deeds and mortgages for others as the practice of law. The lender’s closing attorney typically examines title, prepares the mortgage and deed, and disburses; Alabama is a wet-funding state, so money changes hands the day the papers are signed. Attorney and title fees together usually land in the low four figures on an ordinary purchase.
Alabama levies a mortgage recording privilege tax of $0.15 per $100 of the amount secured (Ala. Code § 40-22-2), so a $250,000 mortgage costs $375 in tax at recording, generally paid by the borrower. A separate deed tax of $0.50 per $500 applies to the conveyance itself. Probate-court recording fees per page are added on top. Alabama charges a deed recording tax of $0.50 per $500 of value (0.10%) plus a mortgage recording tax of $0.15 per $100 borrowed; together they add well under 1% and are usually split by local custom.
Closing costs in Alabama run low by national standards because transfer taxes are small and title premiums are moderate; budget roughly 2% to 4% of the price before any seller concessions.
Prepayment, spouses and homestead in Alabama
Prepayment. Alabama has no statute that flatly bans prepayment penalties on residential mortgages; a penalty is enforceable only if the note provides for it, and the Alabama Consumer Credit Act (the “Mini-Code”, Ala. Code § 5-19) gives borrowers a right to prepay the loans it covers. Fannie Mae and Freddie Mac do not buy loans with prepayment penalties, so a conforming loan will not carry one.
Spouses and title. Alabama is a separate-property state, and dower and curtesy were abolished in 1983.
Homestead. The Alabama homestead exemption (Ala. Code § 6-10-2) shields equity in up to 160 acres of the family residence, in an amount the legislature raised to $15,000 per person in 2015 and now adjusts for inflation every few years — check the current figure before relying on it.
The complete state layer — licensing, predatory-lending limits, disclosures, foreclosure — is on mortgage laws in Alabama.
Frequently asked questions
What is the conforming loan limit in Alabama for 2026?
The FHFA baseline of $832,750 applies statewide — none of Alabama’s 67 counties qualifies as high-cost in 2026. With 20% down you can buy up to about $1,040,938 and stay conforming; two- to four-unit homes have higher limits ($1,066,250, $1,288,800, $1,601,750).
When can I cancel PMI on a conventional loan in Alabama?
The request point is 80% of the original value, the automatic point 78% — federal rules, identical in Alabama. With 5% down on the state’s $230,000 median at 6.5%, the amortization schedule alone gets you to 80% in roughly 10 years and 4 months; with 10% down, in about 7 years and 11 months. Paying extra principal shortens both.
Does Alabama add anything to a conventional loan’s closing costs?
Alabama levies a mortgage recording privilege tax of $0.15 per $100 of the amount secured (Ala. Code § 40-22-2), so a $250,000 mortgage costs $375 in tax at recording, generally paid by the borrower. Alabama charges a deed recording tax of $0.50 per $500 of value (0.10%) plus a mortgage recording tax of $0.15 per $100 borrowed; together they add well under 1% and are usually split by local custom. Closing costs in Alabama run low by national standards because transfer taxes are small and title premiums are moderate; budget roughly 2% to 4% of the price before any seller concessions.
Alabama: where to verify
- Alabama Housing Finance Authority (AHFA): state housing finance agency, for current programs and income limits
- Alabama State Banking Department: state regulator of mortgage lenders and brokers
- NMLS Consumer Access: check any lender’s or loan officer’s license
- FHFA conforming loan limit files: the county limits shown on this page
Links checked September 22, 2026. Researched and edited by Clément Lacaille (Tech-Bharat); how we research.
Sources
Related: Mortgage points and rate buydowns: when paying for a lower rate pays off, Cash-out refinance: limits, costs and when it is the wrong tool, Rate-and-term refinance: when it pays, how to compute the break-even, DSCR loans vs conventional for investment property: qualify on rent or on income. First home in Alabama: programs and assistance. Hub: Conventional loan.