5 Best Land and Lot Loans in Alabama


Alabama land loans give aspiring homeowners an easier way to create their ideal home and business owners access to real estate.

Key Terms

  • Purchasing land with a land loan can make it easier to have a home in popular neighborhoods.
  • Many land loans offer flexible payment options.
  • Land loans, sometimes referred to as lot loans, do not require monthly insurance, saving you money.

Do you love the relaxing ethos of Southern living, delicious seafood and Southern cuisine, and a great quality of life? You may well live in Alabama.  Within the 50,647 square miles of Alabama as documented by the U.S. Census Bureau, you can find everything from bustling cities to quaint small towns and rural settings.

Given all that, it’s no surprise that many Americans want to call Alabama home. Many Alabamans are taking a different approach to property in the state, however, by turning to land loans. Per the New Estimates of Value of Land of the United States, the value per acre of land in Alabama is $12,355.59, giving Alabamans perhaps an easier way to approach homeownership. 

While construction loans in Alabama finance a renovation or build project, a land loan helps you secure the land you need to build a home. There are no requirements with land loans as to how you use the land, giving you some time for planning and budgeting.  

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Benefits of getting a land loan in Alabama

Purchasing a home is a costly endeavor. This is particularly true when buying a turn-key, move-in ready, or new construction home. You could buy a fixer-upper, but that would entail months, if not years, of costly renovations and additions.

The other option is to lower your expectations so that your budget matches what is on the market. None of those alternatives sound appealing, which is why many people prefer to buy vacant land instead. The benefits of getting a land loan include:

  • Owning a home for less than a new, built home on the market
  • Being able to design your home to your tastes
  • Building on your own schedule
  • Gaining access to neighborhoods you might not otherwise afford

When the alternative is settling for less, taking out a land loan can well be worth the effort for certain borrowers who don’t want regular home loans or can’t get them. If a land purchase is in your future and you already found a great piece of land through the NMLS, other types of loans may not work. However, land loans are an excellent option or land financing for your real estate. Whether you’re seeking rural property or another location for your dream home, discuss your loan amount, competitive rates, closing costs, and other details with a financing expert who understands land loans.

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5 Best Alabama land loan lenders

If you’re ready to learn more about the best land loan lenders in Alabama, here are the top options we’ve found through our research.

1. Alabama Credit Union

Founded to serve the University of Alabama in 1956, Alabama Credit Union serves the state of Alabama with financial services with over $1.5 billion in assets and 35 branch locations. As part of their financial service platform, you won’t be surprised to hear that Alabama Credit Union has a land loan and lot loan program.

To get you the best information, we contacted Alabama Credit Union for more details on their land loans and here are the key features and terms:

Subdivision lot loans:

  • 10-year terms
  • Fixed rates available
  • 25% down payment
  • Purchase and refinance options available

Undeveloped land loans:

  • 15-year terms
  • Fixed rates available
  • 30% down payment
  • Purchase and refinance options available

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

2. First South Farm Credit

With over 100 years of experience, First South Farm Credit is an important financial resource. Operating as a financial cooperative, they are member owned and specifically focus on supporting agriculture and rural communities through land loans for small and large tracts, cropland, poultry operations, timberland, pastures, and more.

To get you the best information, we contacted First South Farm Credit for more details on their land loans and here are the key features and terms:

  • Small & large acreage tracts
  • Crop land
  • Poultry operations
  • Timberland
  • Land for other agricultural purposes
  • Pasture land
  • Land for a rural residence
  • Long-term financing up to 30 years

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

3. AgAmerica Lending

AgAmerica Lending is a multi-generational family farm lender serving residents in numerous states. The organization specifically focuses on agricultural financing. It is ranked as one of the fastest growing private companies and offers coast to coast services to farmers and ranchers throughout the country.

We reached out to AgAmerica Lending to discuss land loan details, which you can read about below:

  • Minimum of 25 acres required
  • Minimum loans of $150,000
  • Farm/ranch financing available
  • Recreational land loans available
  • Terms from 18 months to 30 years

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

4. Citizens Bank & Trust

Based in North Alabama, Citizens Bank & Trust provides a number of services for those living in the area and looking to invest in property. Citizens Bank & Trust offers land loans and construction loans to help with the purchase of property as well as the building on property.

We reached out to Citizens Bank & Trust to discuss land loan details, which you can read about below:

  • Available for home construction or land
  • Available for primary residence or secondary home construction
  • Draw system: funds can be disbursed in stages as construction progresses
  • May roll into permanent loan, saving on closing costs
  • Local decision-making and processing

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

5. Alabama Farm Credit

Since its founding in 1916, Alabama Farm Credit, along with its network called Farm Credit System, provides farmers, ranchers, farmer-owned co-ops, rural home buyers, agricultural businesses, and infrastructure investors with financing solutions. That includes rural land loans in Alabama offering competitive pricing.

We reached out to Alabama Farm Credit to discuss land loan details, which you can read about below:

  • Land loans to build new construction, including homes or barns.
  • Land loans to buy land for hunting, fishing, riding horses, or other recreational activities.
  • Land loans to make improvements to the existing land.
  • Fixed-rate loans, short-term loans, and long-term loans.
  • Interest rates vary due to credit score, the loan size, and other considerations.

When you’re ready to connect with a loan officer, use our form to quickly match with land and lot loan programs based on your specific circumstances.

Does an Alabama home land loan make sense for you?

If you’re having trouble finding the right home in Alabama, a land loan might be a good option for you. Is a land loan right for you? Ask yourself:

  • Do you want some flexibility in the process of buying a home?
  • Are you interested in highly prized neighborhoods where home prices are increasing?
  • Is the land you are looking at raw, unimproved or improved?
  • Do you already have a design in mind?

These questions are a good start when considering a land loan. With the wealth of easy and affordable construction options out there today, you could have a dream home well within your budget with the right planning. 

If you’re looking to explore land and lot loans in other states, check out our national overview of land loans as a starting point in your search.

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Joshua Holt

Joshua Holt is a licensed mortgage loan originator (NMLS #2306824) and founder of Biglaw Investor. His mortgage expertise lies in the areas of professional mortgage loans, particularly for lawyers, doctors and other high-income professionals. Prior to Biglaw Investor, Josh practiced private equity mergers & acquisition law for one of the largest law firms in the country.

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