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The following table shows current 30-year Ashburn mortgage refinance rates. You can use the menus to select other loan durations, alter the loan amount. or change your location.
Alabama goes by several names including “The Yellowhammer State,” “The Heart of Dixie,” and “The Cotton State.” It is the thirtieth largest state by area, and it has the twenty-fourth largest population in the United States. Alabama is a historically rich state with several important landmarks in the American Civil Rights Movement, including the Rosa Parks Museum and Martin Luther King Jr's historic church. When you pair this with the broad cultural environment, it makes Alabama an excellent state to raise a family.
People are drawn to Alabama for a broad range of reasons including the low cost of living, which ranks as the fourth lowest in the nation. The Alabama Crimson Tide and the large universities draw a lot of college-aged people, and the historical significance of this state also brings many tourists and permanent residents to this state every year.
The people in Alabama as a whole have a strong work ethic, and this can help to attract many new businesses to the state each year. People move here because of these new companies, the culturally diverse background, the rich historical significance of this state, and the low tax rates. Currently, Alabama ranks sixth for the lowest tax rates in the nation. There are also a wide range of cities, suburbs, and rural areas to choose from, along with coastline and beach communities.
However, people are also leaving Alabama for several key reasons. Many students move out of the state once they finish their college education for their first jobs. Also, even though there are companies moving into the state at a quick pace, there aren't enough jobs to sustain people. Alabama also has lower wages, and their housing markets in the larger cities are slightly higher. This can create a drain that sends people to other states with more job opportunities and higher wages.
The early 1990s until late 1999 saw a steady increase in Alabama real estate market with a few slight peaks in 1996 and 1998. In early 2000, there was a sharp increase in the housing market that leveled off by early 2001. Once again, Alabama's housing market began to climb steadily until 2007, when it saw a slight increase that continued until early 2008.
Birmingham saw a steep by steady climb from the 1990s up to the end of 2000. From the end of 2000 until mid-2001, there was a sharp increase in the housing market. This peaked and continued to steadily climb until 2008 with one minor drop at the end of 2007.
By the third quarter of 2008, housing prices suffered a steep drop only to rise once again in 2009. Once 2009 came and went, home prices went into a rocky free fall. In mid-2010, there was a slight peak in the housing market before it continued to fall. From 2011 to 2013, there were a few peaks and falls until the market hit rock bottom at the start of 2013. The market began to recover slowly, and 2016 saw another peak and plateau, but it has been on a steady rise ever since.
Housing prices in Birmingham dropped sharply at the end of 2008, only to rise to another peak in 2009 before starting to descend into a rocky fall. There were several other peaks and losses from 2009 until 2011 when the housing market hit its lowest point. Since 2011, the housing market has started to rise in shaky patterns with peaks and setbacks. However, as of the middle of 2016, the housing market has been on a steady incline that shows no signs of stopping.
Depending on the area you want to purchase a home in, you may have a slight difficulty finding one. The larger cities are experiencing a high demand for homes, and this is driving the housing costs up. However, if you look at statewide trends, Alabama has one of the most improved housing markets as an overall state in the nation as of 2016.
Statewide, the Alabama housing market has experienced a steady increase since it hit bottom in 2013. This steady rise hit a slight peak in mid-2016 and plateaued out until it began to rise once again at the start of 2017. It has been on a steady rise ever since, and it shows no sign of slowing down.
As of today, Alabama's real estate market is higher than it was before the housing market crisis, and this is in part because of the companies that are coming in and adding more jobs to the economy. Additionally, housing market prices are predicted to rise between 3% to 4% in the oncoming year and the demand for houses increase. All of this means that people who are currently looking for houses will most likely face steep competition in the form of other buyers and rising prices.
Homeownership rates across the state rose from 66.5% in 1988 to a peak of 78% in 2004 and gradually declined back to 69.7% in 2016.
Through the first 3 quarters of 2020 real estate held up far better than it did during the 2008 housing recession. Central banks and politicians reacted faster and much more aggressively to the COVID-19 crisis than they did to the 2008 recession. Many novel and unconventional policies which began in response to the prior recession were used much more aggressively in this recession. For instance, here are some of the policies which were enacted:
On November 24, 2020 the Federal Housing Finance Agency (FHFA) raised conforming loan limits by 7.42%, reflecting strong annual growth in the nationwide FHFA House Price Index (HPI).
|AL Rank||US Rank||Metropolitan Area||2016 Pop||2010 Pop||Change||% △|
|5||161||Columbus, GA-AL Metro Area||308,755||294,865||13,890||4.71%|
|26||830||Eufaula, AL-GA Micro Area||28,300||29,970||-1,670||-5.57%|
Alabama is home to several prominent cities that are popular for their culturally diverse backgrounds, entertainment venues, education opportunities, and their historical significance.
Birmingham is the most populous city in the state of Alabama with a population of 212,157 people as of 2016. It is part of the Birmingham-Hoover Metropolitan area and combined they have a total population of 1,147,417 people. This metro area encompasses around one-fourth of Alabama's total population, and it continues to grow.
This city was founded on the steel industry, and it was affectionately called the “Pittsburgh of the South” due to this economic base. This continues to be a pillar of the local economy, but it has also shifted to banking, biotechnology, and medical research. You'll also find several prominent engineering companies here, and two of the largest pop-bottling companies are found here as well.
If you visit or live here, you'll be living in a humid or subtropical climate zone. You'll experience very hot and humid summers, mild winters, and a lot of rainfall year round. The lowest temperatures come in mid-January, and they're around 46 degrees Fahrenheit, with the highest temperatures commonly seen in July in the upper 80s to low 90s. Additionally, it isn't unusual to experience strong thunderstorms in the spring and fall months due to cold fronts moving through.
Birmingham is billed as the art and cultural center for all of Alabama, and there are dozens of events and museums to visit. The Birmingham Museum of Art is located here, and it is the largest art museum in the Southeast portion of the nation. You can find the Alabama Jazz Hall of Fame here, along with the Civil Rights Institute. Additionally, the Sidewalk Moving Picture Festival draws thousands of tourist through the city each year.
There are several notable educational institutions found in Birmingham as well. Students can choose between eleven universities and technical colleges found in this city, and this includes University of Alabama at Birmingham, the Miles Law School, and the University of Montevallo.
You'll find a major portion of the nation's banking industry in Birmingham, and this includes Regions Financial Corporation. Another notable employer in this city is the UAB Hospital. This Level 1 Trauma Center is the largest employer in the city, and the second-largest employer in the state of Alabama with over 23,000 staff members. Finally, another notable employer is Blue Cross Blue Shield of Alabama who has their headquarters here.
The local economy continues to grow as more and more companies become interested in the area. It is a great place to find steady work, and it has consistently been ranked as one of the best cities to live as the low cost of living and steady work opportunities provide a comfortable living for its residents.
The median home price in Birmingham is around $62,600, and this represents just over a 1% increase over the past year. The price per square foot is also relatively low at $53. However, when you compare this to the Birmingham Metro area, you see that the prices are almost on opposite ends of the spectrum. The Metro area's median home price is $132,400 with a price per square foot of $103. This price has increased over 1% in the past year with a projected 3.3% increase coming this year.
The second largest city in the state of Alabama is Montgomery with a population of 200,022 people. It is also the capital of the state of Alabama, and it is the 115th largest city in the nation. The Montgomery Metro area has a total population of 373,922 people, and this makes it the fourth-largest metro area in Alabama.
Montgomery's economy relies heavily on several key crops including soybeans, cotton, and peanuts. Other sections that complete this city's economy include government jobs, a busy industrial hub, the school system, and healthcare. The military plays a large roll in employing people in Montgomery as well.
This city has a humid subtropical climate, and this means you get hot summers and mild winters with a lot of annual rainfall. December and January typically see the lowest temperatures of the year at around 40 degrees Fahrenheit, and June through August sees the highest temperatures topping out at 88 degrees. The spring and fall weather is typically warm with severe thunderstorms and moderate rainfall.
Montgomery has one of the biggest art scenes that you'll find anywhere in the United States. The Montgomery Zoo is home to more than 500 animal species, and it sprawls over 40 acres. You can also visit the Hank Williams Museum, or take a day tour of the Davis Theater of the Performing Arts. There is also a huge Shakespeare Festival that runs each year.
The Montgomery Public School system has over 32,000 students enrolled and over 2,000 staff members. There are 32 elementary schools, 10 middle schools, 5 high schools, and several charter and alternative schools in this system. Alabama State University is also found here, along with Huntingdon College, and several smaller technical and private colleges.
The diverse employment opportunities it this city draw a lot of people each year. The largest employer in Montgomery is the Maxwell-Gunter Air Force Base with around 12,500 employees. The state of Alabama comes in as the second largest employer with almost 10,000 employees, and the Baptist Health Center comes in third with just under 9,000 employees.
The economic outlook for Montgomery is steadily improving. Its unemployment rate is dropping, but it is still slightly higher than the national average. However, the economy is projected to improve by almost 30% in the next ten years, adding thousands of new jobs and giving the economy a boost.
The median local home price for the city of Montgomery is $119,900 with a price per square foot around $64. This is a 2% increase in the past year, with projections of more growth in the coming years. The Montgomery Metro area's median home price is slightly lower at $113,000 and a price per square foot of $84. The Metro area's prices have increased by 5% in the past year, and it is predicted to continue to increase at least another 3% in the coming year.
Mobile had a population of 192,904 as of the 2016 census, and this makes it the fourth-largest city in the state of Alabama. It is the largest city in Mobile County and the largest municipality on the Gulf Coast. The Mobile Metro area is the third-largest metro in the state with a population of 414,836 people.
Mobile has several important economic support systems including aerospace, the steel industry, shipbuilding, retail, construction, and medicine. It is also home to Alabama's only saltwater port, and this brings a lot of shipping business through this city. The economy saw a surge of growth in the mid-1990s with several companies coming in, and this trend continues to grow.
The residents of Mobile enjoy a subtropical climate year round, and this comes with hot, humid summer weather and mild, wet winters. This city also sees some of the most rainfall out of anywhere in the United States year round. Temperatures are at their lowest points from December to January, and they typically stay around the low 40s. Spring and summer in Mobile bring temperatures in the low 90s with humidity and rain.
Mobile has a rich cultural history that pulls heavy influences from Spanish and and French history. This city is the birth place of Mardi Gras, and each year the annual Carnival celebrate brings thousands of tourists out each year. You can also visit the Mobile Museum of Art and the Greater Gulf State Fair.
The Mobile County Public School System has over 65,000 students enrolled, and it is one of the largest employers in the city. The Alabama School of Mathematics and Science is also located here, and there are several universities and technical colleges to attend. The University of Mobile and the Bishop State Community College are two large educational institutions.
The top three largest employers in Mobile are based in education and health care. The largest employer is the Mobile County Public School System with just over 7,750 employees. The second-largest employer is Infirmary Health System and it has 5,460 staff members. Finally, the employer that rounds out or top three largest employer list is University of South Alabama with 5,300 employees.
Mobile's economic outlook looked bleak in the early 1990s, but it's taken a turn for the better with dozens of companies coming in and offering employment opportunities. The unemployment rate is still higher than the national average, but this is predicted to drop within the next ten years, and employment opportunities continue to grow.
The median home price in Mobile is relatively inexpensive at $110,400, and the price per square foot is $90. This represents a 1.2% growth over the past year, and it is supposed to continue to grow another 3.2% in the coming year. The Mobile Metro area is slightly cheaper when it comes to median home prices. Currently, the median home price for the Metro area is $110,300 with a price per square foot of $90.
Huntsville is the third-largest city in the state of Alabama with a population of 193,079 and this population has been quickly climbing. It is projected that Huntsville will soon take the title of the third-largest city in Alabama. This city is part of the Huntsville Metropolitan area, and the metro area's population as of 2016 was 449,720 people. This population puts the Huntsville Metro area as the second-largest in Alabama.
The main economic influences in the city are military technology and aerospace. This technology-driven economy has seen steady growth over the past year. This city ranked as the sixth best in the nation for business in 2005, and also as one of best places for engineers to work. Retail also makes up another large portion of the economy with several large shopping centers and strip malls located here.
Huntsville is also classified as a humid subtropical climate, but it differs from the other cities in Alabama as it experiences large amounts of rainfall in the winter and spring months, but not in the summer months. The average temperatures in December and January hover right around 45 degrees Fahrenheit, and July through the end of August usually has temperatures in the high 80s to low 90s.
There are several historical districts in Huntsville along with several museums, parks, festivals, and activities going on year round. The US Space Camp is found here, along with the US Space and Rocket Center museum. There are also over 57 state parks to explore including the Big Spring International Park and the Rocket City Brew Fest helps to bring tourists in each year.
The Huntsville City Schools are one of the top ranked in the nation with 77% of its students scoring at or above national levels on their ACT exams. There are 53 schools in this system with over 22,800 students enrolled. Students can also attend the Alabama A&M University or the Ross Medical School. Along with these colleges, there are several satellite courses and technical colleges available as well.
There are several large employers in Huntsville with the largest one being NASA's Marshall Space Flight Center. This is closely followed by Cummings Research Park whose Huntsville location makes it the fourth-largest in the world. The third-largest employer in this city is the military base Redstone Arsenal.
The economy in Huntsville is continuing to grow at a rapid pace. The various technological companies draw people from all over the United States, and the availability of jobs is expected to grow by over 34% in the next ten years. The lower cost of living is also another big draw for this area.
Huntsville has a median home price of $138,900 and a price per square foot of $96. Over the past year, the home prices have risen 1.2%, and they're expected to rise at least another 3% in the coming year. The Huntsville Metro area has a higher median home price, and it comes out around $221,900 with an average price per square foot of $95.
The city to round out our top five largest cities in Alabama is Tuscaloosa, and Tuscaloosa had a population of 99,543 people as of 2016. This city is part of the Tuscaloosa Metropolitan area, and the greater metro area has a population of 241,378, and it is the fifth-largest metro area in the state of Alabama.
A major cornerstone of Tuscaloosa's economy is the education sector followed closely by manufacturing and the service industry. Federal, local, and state government agencies make up over 20% of the economic sector in this city. Tuscaloosa also ranked as one of the top cities in the nation to start a business in 2010. Assembly plants and the healthcare industry make for a strong economic outlook.
Tuscaloosa experiences a climate that is typical of the deep south, and it has a humid subtropical climate with four seasons. Spring and fall can bring a lot of rainfall along with severe storms and tornado activity. Winters are mild, and they last from mid-December until the end of February. You'll experience temperatures in the mid to upper 30s during this time. From mid-May until the end of September you'll have summer weather with temperatures up in the low 90s.
Several performing arts organizations call this city home, and there are dozens of museums and festivals to keep people entertained all year round. The Bama Theatre is a huge hub for the performing arts, and it holds over 1,900 people. The Moundville Native American Festival and the Dickens Downtown festival draw tourists each year as well.
The University of Alabama is located in Tuscaloosa, and it has over 36,000 students enrolled each year. Students can also attend Stillman College or the Shelton State Community College. The public school system in this area is also large, and there are over 10,000 students spread across the city.
There are a few notable employers in the city of Tuscaloosa, and the largest one is the University of Alabama with over 10,000 staff members. The DCH Regional Medical Center claims the second-largest employer spot with 4,500 employees. Finally, the third-largest employer is Mercedes-Benz U.S. International Inc with 3,600 people.
Despite all of the companies that call this city home, the unemployment rate is still higher than the national average. However, this is slated to change in the next ten years with job potential growing over 31%. The lower cost of living may continue to draw people to this area, but the lower wages will have a negative impact as well.
The Tuscaloosa median housing price experienced a slight decline in the past year, and it now sits at $140,600 and the price per square foot is $115. The housing price is expected to rise over 3% in the upcoming year. The Tuscaloosa Metro area has a median house price of $145,900, and this is a 2% increase over the past year. The housing price will continue to rise over the next year, and the price per square foot is $109.
Real estate prices remain affordable across the state. Some of the fastest growing cities in the state include Auburn, Madison, Dephne, Phenix City and Fairhope.
According to the United States census an estimated 4,863,300 people live in the state of Alabama. The state has 50,645.33 mi² of land area, which gave it a population density of 96.03 per mi². Here is a list of cities with more than 5,000 residents, with their estimated population as of June 2016 & the 2010 United States Census. For Census Designated Places (CDP) where there was no population estimate available for 2016, the 2011-2015 American Community Survey 5-Year Estimates data was used.
All table columns are sortable. Click on the column headers to sort by that column. Click again to sort low to high. Cities with higher levels of population growth typically see the increased demand drive faster real estate price appreciation.
|Rank||Geography||County||2016 Pop||2010 Pop||Change||% △||Land mi²||Pop Den mi²|
|1||Birmingham||Jefferson & Shelby||212,157||212,237||-80||-0.04%||146.07||1,452.43|
|3||Huntsville||Madison & Limestone||193,079||180,105||12,974||7.20%||209.05||923.60|
|6||Hoover||Jefferson & Shelby||84,978||81,619||3,359||4.12%||47.16||1,801.91|
|7||Dothan||Houston, Dale & Henry||68,468||65,496||2,972||4.54%||89.4||765.86|
|9||Decatur||Morgan & Limestone||55,072||55,683||-611||-1.10%||53.67||1,026.12|
|10||Madison||Madison & Limestone||47,959||42,938||5,021||11.69%||29.59||1,620.78|
|12||Phenix City||Russell & Lee||37,132||32,822||4,310||13.13%||27.75||1,338.09|
|14||Prattville||Autauga & Elmore||35,606||33,960||1,646||4.85%||32.85||1,083.90|
|15||Vestavia Hills||Jefferson & Shelby||34,688||34,033||655||1.92%||19.41||1,787.12|
|18||Enterprise||Coffee & Dale||28,024||26,562||1,462||5.50%||31.24||897.06|
|28||Trussville||Jefferson & St. Clair||21,422||19,933||1,489||7.47%||33.03||648.56|
|29||Oxford||Calhoun & Talladega||21,120||21,348||-228||-1.07%||30.67||688.62|
|Tillmans Corner CDP||Mobile||19,065||17,398||1,667||9.58%||12.97||1,469.93|
|34||Helena||Shelby & Jefferson||18,673||16,793||1,880||11.20%||20.34||918.04|
|40||Millbrook||Elmore & Autauga||15,413||14,640||773||5.28%||12.81||1,203.20|
|49||Pell City||St. Clair||13,794||12,695||1,099||8.66%||24.75||557.33|
|51||Calera||Shelby & Chilton||13,489||11,620||1,869||16.08%||24.09||559.94|
|58||Leeds||Jefferson, St. Clair & Shelby||11,940||11,773||167||1.42%||22.86||522.31|
|64||Boaz||Marshall & Etowah||9,710||9,551||159||1.66%||14.55||667.35|
|75||Southside||Etowah & Calhoun||8,600||8,412||188||2.23%||18.98||453.11|
|78||Arab||Marshall & Cullman||8,340||8,050||290||3.60%||12.98||642.53|
|Brook Highland CDP||Shelby||7,032||6,746||286||4.24%||2.83||2,484.81|
|Moores Mill CDP||Madison||6,591||5,682||909||16.00%||13.6||484.63|
|Grayson Valley CDP||Jefferson||5,160||5,736||-576||-10.04%||2||2,580.00|
|101||Glencoe||Etowah & Calhoun||5,135||5,160||-25||-0.48%||16.93||303.31|
Annual Estimates of the Resident Population: April 1, 2010 to July 1, 2016
Source: U.S. Census Bureau, Population Division
Release Date: May 2017.
As of 2022 the conforming loan limit across the United States is set to $647,200, with a ceiling of 150% that amount in areas where median home values are higher. With the state of Alabama having below average median home prices, the $647,200 limit applies to single family homes statewide. The limits for 2, 3 & 4 unit dwellings are: $828,700, $1,001,650, & $1,244,850.
The homeownership rate in Alabama is close to seventy percent and the most popular type of loan is a 30 year mortgage. Given that homes are quite affordable across the state, 15 year fixed loans are another popular option which helps home buyers build equity faster and save on interest expenses.
Adjustable rate mortgages (ARM) are also an option for potential homeowners who don't believe they will live in the home for many years and want to write off interest payments. Balloon mortgages are another route for aspiring homeowners. Balloon mortgages are when a large portion of the borrowed principle is repaid in a single payment at the end of the loan period. Balloon loans are not common for most residential buyers, but are more common for commercial loans and people with significant financial assets.
Mortgage underwriters prefer debt-to-income ratios to be below 40%, but other factors are considered on the loan application. When qualifying for a loan, a credit score of 720 or better can help secure a favorable loan. As a general rule of thumb, coming to the table with a 20 percent down payment is usually the best approach. This down payment requirement does not apply for Federal assistance programs such as FHA, in which applicants can have a lower credit score and income but still receive financing.
The piggyback loan is another type of mortgage which is simply two mortgages in one. The piggyback loan can eliminate the need for private mortgage insurance by covering 80% of the home's value with the first loan, while the second loan helps to pay for part of the down payment.
Prospective home buyers who don't find what they're looking for at one of the state's private banks may want to take a look at some of the mortgage options the federal government offers. One of them is the loan program at the Veterans Administration, which provides mortgages with zero down. On top of that great deal, VA loans do not require private mortgage insurance. The agency does, however, charge a funding fee, and this varies from 1.2% to 3.3%. Making a voluntary down payment will reduce this charge. And in case you're wondering, yes you do have to be a qualified veteran to get one of these unbeatable deals.
If you're not a vet, you may want to consider the Federal Housing Administration's home loan services. The FHA offers loans to people who have a credit score of at least 580 and who can put at least 3.5% down. The government agency also offers mortgages for lower credit scores, but it requires more money down with these loans.
USDA loans can help people with low incomes in rural parts of the state qualify for a subsidized low-interest loan. Given the low population density throughout most of the state, most areas qualify.
State & Local Assistance Programs
The state of Alabama has a few mortgage programs that are designed to help lower-income households obtain home loans. We'll talk about requirements and the application process for each one.
The Alabama Mortgage Credit Certificate program is available to both government and private mortgages. This program will give home buyers a tax credit, and this works to reduce the amount of Federal taxes they owe each year.
This tax credit goes off of a percentage of the annual mortgage interest, and the remaining interest can be claimed as a mortgage interest deduction. However, all participants have to meet certain income and sale price limits to be considered eligible. It is also good to note that the amount of interest this program will cover is largely based on the applicant's mortgage loan amount.
Hardest Hit Alabama is a program that helps homeowners prevent their homes from going into foreclosure. There are several eligibility requirements you have to meet, and there are some things that will automatically exclude you from this program. If you're currently in active bankruptcy, have a mortgage-related felony, you have a rental property, second home, or a seller financed property, you won't be eligible.
If your mortgage is less than $258,690 and your total household income is at or below $77,700, you may be eligible. This program would give you between $30,000 and $60,000 to prevent the foreclosure proceedings if you suffered an involuntary unemployment, divorce, death of a spouse, disability, or medical hardship.
Additionally, this program can also help people who are struggling to pay their mortgages by providing loan modification assistance, lien extinguishment, and short sale assistance.
The HOME program helps first-time homebuyers obtain the financing they need to be able to afford their mortgage payments. There is a Single Family HOME and a Multi-Family HOME program to choose from.
This specific program varies by city to city, but it helps you get the financing you need to purchase a 3 bedroom/2 bathroom new home that is priced around $70,000. Your household has to meet certain income requirements to be considered eligible for this program, and you have to be a first-time homebuyer.
The Step Up+ program began in June of this year, and it is a mortgage assistance program. This program is designed to help people who need down payment assistance buy can afford to pay their mortgages. The Step Up+ program takes in a little farther, and it also offers to pay the upfront split private mortgage insurance cost, and this goes up to $1,500.
To be eligible for this program, any prospective home buyer has to prove that their monthly household income is below 80% of their area's monthly income. The income limits vary from county to county, so it is important to know which county you want to purchase a home in.
The down payment funds from this program come in the form of a 10-year second mortgage, and you have to combine them with a 30-year fixed rate mortgage to qualify. Additionally, you have to meet these requirements to apply:
Most of Alabama has a very low earthquake risk, while Birmingham and the northeastern edge of the state near Huntsville has a low earthquake risk. Here are counties which have a low risk: Cherokee, De Kalb, Jackson & Jefferson.
Standard rental and homeowner insurance policies typically do not cover earthquake damage, though they usually cover losses caused by fires which resulted from an earthquake. You can supplement your homeowner's insurance with an earthquake policy.
Most of Alabama has a very low risk of flooding. Here are counties with higher risk levels.
Homeowner's insurance policies typically do not cover flooding.
Home buyers with mortgages in high-risk areas are required to buy flood insurance. Most flood insurance policies are sold by the United States federal government through The National Flood Insurance Program. Under-priced flood insurance in high-risk areas act as a subsidy to wealthy homeowners.
“The NFIP does not charge nearly enough to cover the expected costs of its liabilities. The assessments are not sufficient to build any buffer to cover an extraordinary year, such as what occurred with Hurricane Katrina in 2005 or Hurricane Sandy in 2012. Because homeowners don't incur the full cost of building in a flood zone we end up with more houses there than if homeowners incurred the full cost of the flood risk, which exacerbates the government's costs in the next disaster.”
Typically, homes built after 2002, when building code regulations tightened, are subject to lower insurance rates than older homes. On the other hand, homes without hurricane straps, with roofs that do not meet current standards for wind, with older plumbing or with outdated electrical systems may be difficult or very expensive to insure.
Homeowners who live in lower risk areas & are not required to purchase flood insurance heavily cross-subsidize homeowners who are in areas where floods are more common.
Much of the state is considered to have a moderate tornado risk, with the norther part of the state having a very high tornado risk. A basic homeowners policy should cover financial damages from tornadoes.
Hail damage is not uncommon across the state. Damage from hail is typically covered by home insurance policies.
When it comes to property taxes, the state of Alabama has one of the lowest levels in the nation, ranking in with the second lowest percentage behind Hawaii. Property prices are much lower in Alabama than Hawaii, so when the low rate is combined with the low home price this means that on average you can expect to spend around $776 per year on property taxes if your home is valued at the median local home price of $161,853. This does fluctuate slightly by county, and Shelby County has the highest property tax rates in Alabama with a median assessment of $905.00 annually. The Birmingham metro area had an average assessment of $1,229 in 2016.
When you compare this to a national level, Alabama ranks as the 49th state out of 50 for property taxes as a percentage of the average income. This works out to 0.78% of the yearly income for Alabama residents, and 0.48% of the property's value when compared against a national average of a 1.24% assessment against the value of the property.
In 2014, the Federal government passed several laws that governed how mortgage agencies interacted with customers who had defaulted and were in danger of going into foreclosure. A few key points to these laws are as follows:
Alabama foreclosures are done on a recourse basis. This means that if a person defaults on their mortgage, the mortgage lender can sue the defaulted party to make up for whatever mortgage balance they lost during the sale of the property, and any additional damages they incurred during the foreclosure process.
For example, if a person defaults on a mortgage and the balance is $90,000, and the lender sells the home at an auction for $45,000, they'll take a $45,000 loss. However, they can then sue the person who defaulted on the mortgage for the additional $45,000 they lost during the sale.
The majority of Alabama's foreclosure proceedings are done through a non judiciary process. This means the mortgage lender usually won't involve the courts in the foreclosure process. However, the mortgage lender is also able to go through the courts and have a judicial foreclosure if they choose. But, this usually takes more time, so the non judiciary foreclosure proceedings are more popular with mortgage lenders.
Borrowers who have defaulted on their mortgages have up to one year to attempt to redeem their homes. This potentially lengthy redemption period makes obtaining a deficiency judgment difficult. It also makes the foreclosure process somewhat more difficult to execute in Alabama.
Alabama recognizes both judicial and non-judicial foreclosure processes. However, as a general rule, most foreclosures in Alabama use non-judicial foreclosure procedures. This is the case because most modern mortgage instruments issued in Alabama contain a Power of Sale clause that makes it easier to foreclose on a defaulted property.
Here is a brief overview of how each procedure works in Alabama:
Here is how the judicial foreclosure procedure works in Alabama:
The judicial foreclosure procedure works in Alabama only if there is no verifiable "Power of Sale" clause in the original loan provisions. If this is the case, here are the steps that the lender must go through to use the judicial foreclosure procedure:
Here is how the non-judicial foreclosure procedure works in Alabama:
Here are those few modifications:
Check out the following resources to learn more about local real estate markets across Alabama.