Alabama Mortgage Lender

    The Best Alabama Mortgage Lenders In 2021

    shutterstock 568476061 1

    The typical cost of buying a home in Alabama is $138,975 – meaning it’s the 47th most expensive state (including Washington D.C.) to buy a house in the United States. That’s a pretty good number compared to the national median of $287,148. 

    But housing prices are just one piece of the puzzle. You also have to consider the current mortgage rates, refinance rates, and available mortgage lenders in your chosen area. 

    No two mortgage lenders are the same, of course. Some offer more leeway to those with less-than-stellar credit scores or who can’t afford exorbitant down payments and closing fees. At the end of the day, finding a lender that can cater to your needs is just as important as finding your dream home. 

    If you’re looking to find the best mortgage lender in the Heart of Dixie, this article is for you. Below, we offer our expert advice on the best Alabama mortgage lenders in 2021, along with a guide to choosing the best mortgage lender today.

    shutterstock 1828086869

    How To Choose A Mortgage Lender 

    Before we discuss our picks for the best Alabama mortgage lenders, let us talk about our methodology. In deciding on a top 5 list, we considered these key factors: home loan products offered, affordability, ease of application, customer service and satisfaction, and availability. 

    Mortgage Options

    There are several ways to classify the current loan products available today, including: 

    • Conforming loans: These are loan types that fall within the maximum borrowing limit of $548,250. Note that in high-cost markets like Alaska and Hawaii, the limit is higher at $822,375.
    • Jumbo mortgage: These are loans that exceed the maximum limit. 
    • Fixed-rate loans: These are loan types that have a fixed or unchanging interest rate. Most lenders will offer 10-, 20-, and 30-year fixed-rate options, wherein the rate remains the same throughout the loan terms. Typically, homebuyers who value consistency and predictability will get this type of loan.
    • Adjustable-rate mortgages: Unlike fixed-rate loans, ARMs have a fixed rate only for a certain amount of time (that was previously agreed upon). Once that time is up, the interest can fluctuate annually depending on the market. ARMs usually come in 3/1, 5/1, 7/1, and 10/1 terms – the first number represents the initial fixed period, while the second number represents the number of times the rate can change in a year. 
    • Government-backed loans: Homebuyers with poor credit or minimal funds for a down payment can opt for a government-backed loan, via the Federal Housing Authority, the Department of Veterans Affairs, or the United States Department of Agriculture. These loan products are usually targeted at low-income, first-time buyers. 
    • Mortgage refinancing: Also known as a refi, this is a new home loan you can take to pay off an outstanding loan. Most people opt for refis when they believe they can get a new loan with better terms and rates than their current one. This is also an option for consolidating debt if needed. There are different kinds of refis, including rate and terms refinancing, cash-in refinancing, and cash-out refinancing. 
    • Home equity lines of credit: Also known as a HELOC, this financial solution is akin to a credit card wherein your home acts as the collateral. 


    Interest rates are always changing, so we choose not to use this as a metric for a lender’s affordability. Instead, we look at how easy a lender makes it for people to become prospective homeowners. Some of the factors we look at are:

    • Minimum FICO score: While credit scores range from 300 to 850, most lenders only accept folks with a minimum score of 620. This is because they need to make sure that you can consistently meet your monthly payments. However, some lenders may be more lenient than others and accept lower scores for first-time buyers.
    • Minimum down payment: The rule of thumb used to be that borrowers should put 20 percent down when buying a house. These days though, you can find lenders that are willing to accept as low as 3 percent down – as long as you can pay for private mortgage insurance, too.
    • Closing costs: Aside from the principal amount and the down payment, homebuyers should set aside money for additional fees at closing, including things like application fees, origination fees, underwriting costs, etc. All of this can amount to up to 5 percent of your mortgage’s value, but it varies per lender. 
    • First-time homebuyer programs: Each state has its own version of this, which provides assistance for families that are just starting out. Typically, this includes down payment loans, tax credits, and closing cost grants. Some lenders may also have their own special loan program offers. 
    shutterstock 1397767763 1


    When we assess a lender’s application process, we ask the following questions:

    • Can an applicant complete the application online? This isn’t necessarily a deal-breaker, but it’s good if a lender can provide the option for those who are busy, live far away from the nearest branch, or who are still following social distancing protocols.
    • Does the lender show mortgage rates online? Online financial tools like calculators and rate comparison tools make it easier for homebuyers to compare multiple lenders before making a move.
    • How long does the application process take? Always ask your loan officers how much time it will take between submitting your documents and closing. Depending on the lender, the process may take anywhere between a few weeks to several months. 

    Customer Service And Satisfaction

    If a good mortgage lender can create lasting relationships with its customers, it'll show. Online reviews can help you get a better picture of how well a lender takes care of its customers. But aside from these, we also look to two agencies for more concrete analysis – JD Power and the Better Business Bureau.

    JD Power is a marketing research firm specializing in consumer insights and data analytics, and they release annual customer satisfaction studies across different industries. 

    The BBB, on the other hand, tells us whether a lender is “trustworthy” through a rating system from A+ to F. The ratings represent the BBB’s opinion of how the company is “likely to interact with its customers”.


    Finally, remember to consider whether there are loan officers near you who can accommodate you. If you’re a first-time buyer, being close to a brick-and-mortar location will make it easier for you to ask questions and get assistance from mortgage brokers.

    5 Best Alabama Mortgage Lenders 

    Based on the criteria we discussed above, here are 5 of the best Alabama mortgage lenders:

    1. Regions Bank: Best For First-Time Buyers

    Min. credit rating: 620

    Min. down payment: 3.5%

    Loan types offered: Conventional, home equity loans, HELOCs, FHA, VA, and USDA loan products, mortgage refinancing

    BBB Rating: A+

    JD Power rating: N/A

    Overview: Based in Birmingham and with over 200 branches across Alabama, Regions is an excellent choice for first-time buyers who feel more comfortable getting face-to-face assistance with loan officers. 

    Regions also offers renovation and repair programs, along with a HomeBonus program that incentivizes applicants for applying through approved Alabama mortgage brokers. Aside from this, Regions also offers Alabama’s first-time homebuyer programs, allowing eligible applicants access to down payment assistance. 

    Availability: Regions Bank has over 1,400 locations spread across 15 states, including Florida, Tennessee, Alabama, Mississippi, Georgia, Louisiana, Arkansas, Texas, Missouri, Indiana, Illinois, South Carolina, Kentucky, Iowa, and North Carolina. 

    2. Carrington Mortgage Services: Best For Borrowers With Low Credit Rating

    Min. credit rating: 500

    Min. down payment: 3%

    Loan types offered: Conventional, mortgage refinance, adjustable-rate loans, mortgage products for first-time homebuyers, and government-issued loans such as VA, FHA, and USDA loans

    BBB Rating: A+

    JD Power rating: N/A

    Overview: Carrington is an Anaheim-based company that is popular among low-income and first-time buyers for the low credit score and down payment requirements in most of their loan options.

    Carrington’s Flexible Advantage Loan is a conforming or jumbo loan that is marketed as an “ideal solution” for homebuyers with low credit and those who have had a recent credit event. It’s also ideal for those who may need help with their income documentation, or those who are worried they might not pass their credit and property approval. 

    Plus, the minimum credit score requirement for this loan is only 550. That’s much lower than the usual 620 requirements at other lenders. Carrington does not require clients to get PMI even if they pay below 20 percent down. 

    Availability: Carrington originates in all US states except Massachusetts and North Dakota. However, you may be hard-pressed to find a location near you if you don’t live in Arizona, California, Connecticut, Florida, Indiana, Maryland. 

    3. Rocket Mortgage By Quicken Loans: Most Convenient Lender

    Min. credit rating: 620 for conventional, 580 for FHA 

    Min. down payment: 3%

    Loan types offered: Conventional and jumbo loans, government-issued loan options like FHA and VA loans, and refinance

    BBB Rating: A+

    JD Power rating: 883 (the highest ranking on the 2021 study)

    Overview: Rocket Mortgage by Quicken Loans is the most popular mortgage lender in the US. This is because the lender offers an array of mortgage options with lower-than-average credit score requirements, a fast and convenient application process, and is available pretty much anywhere in the US – so long as you’re okay with a fully online application.

    One of the best features of Rocket Mortgage is its quick application process. On the website, you can pre-qualify in less than 10 minutes. Plus, you don’t need to pay any extra fees if you opt to pay off your mortgage early. 

    However, if you’re looking for USDA mortgages or HELOCs, you won’t find them here. If you want similar online capabilities from a lender that offers USDA mortgages, you can try Sebonic Financial. 

    Availability: Available in all 50 states

    shutterstock 1613352016

    4. Veterans United Home Loans: Best For VA Loans

    Min. credit rating: 620

    Min. down payment: 3.5%

    Loan types offered: Conforming VA, jumbo VA, refi

    BBB Rating: A+

    JD Power rating: 873, but the brand isn’t counted in the final ranking because it doesn't meet JD Power’s awards criteria

    Overview: Veterans and active-duty members are entitled to VA loan options, which usually come with lower-than-average interest, zero down payment, and no private mortgage insurance. 

    At Veterans United, getting a VA loan is made even easier, as the lender is quite flexible in terms of maximum debt-to-income and loan-to-value ratios. Veterans United also does not impose a minimum loan amount, but it does cap off its maximum at $1.5 million. 

    Availability: Veterans United has branches in multiple states, including Alabama, California, Colorado, Florida, Georgia, Hawaii, Idaho, Illinois, Kentucky, Nebraska, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and Washington. 

    5. Bank Of America: Lowest Rates And Jumbo Options

    Min. credit rating: 620

    Min. down payment: 3%

    Loan types offered: Conventional, jumbo, fixed-rate, ARMs, Federal Housing mortgages, VA loans, HELOCs, refi, and Affordable Loan Solution

    BBB Rating: A+

    JD Power rating: 860 (second on the ranking next to Rocket Mortgage)

    Overview: When measured by assets, BoA is America’s second-largest bank. It’s been around for over 200 years, so it’s a legacy brand that has been tried and tested over decades. Longevity aside, BoA has been consistent in providing excellent service to its clients as well.

    But what really makes BoA a great option are its rates. In most places, Bank of America offers the lowest rates compared to other mortgage lenders of its caliber. Aside from this, BoA and Merrill Lynch clients are entitled to discounts on origination fees.

    Aside from low rates and discounts, BoA is also known for its variety of loan products, including programs for first-time homebuyers, and its jumbo mortgages – borrowers can loan up to $2.5 million.

    Availability: Bank of America offers its loan services in all 50 states.

    shutterstock 1928903864

    Closing Thoughts

    Southern hospitality, good food, and a rich musical heritage make Alabama a great place to buy your dream home. And with housing costs and rates so low, it won't cost you an arm and a leg. Hopefully, with this guide, you can hone in on a good lender who can offer you all the right financial tools and financial products you need to get started.

    Want to learn more about mortgage rates in Alabama? Or perhaps you're looking for good lenders in other states? We've got you covered. Contact Wesley Mortgage, LLC to learn everything you need to know about getting a mortgage, including:

    • How to get pre-approved
    • Credit and property approval requirements
    • The next steps
    • Getting the best rates
    Written By Ed Wallace
    Follow the author on: