Alabama Foreclosure Laws
Judicial Foreclosure Available: Yes
Non-Judicial Foreclosure Available: Yes
Security Instruments: Mortgage, Deed of Trust
Right of Redemption Period: 12 Months
Deficiency Judgments Allowed: Yes
Time Frame: Typically 30-90 Days; 60 is Average
Public Notice: Notice of Default
Alabama is considered to be a title theory state, which means that a property title will remain in trust until the loan is paid in full. In the state, a title can be secured by either a mortgage or a deed of trust. The mortgage and deed of trust serve the same purpose and generally have the same terms.
Two types of foreclosures are allowed In Alabama. Lenders may choose to foreclose on a mortgage or deed of trust through either a judicial foreclosure or a non-judicial foreclosure. However, the state’s primary method of foreclosure is non-judicial foreclosure.
Types of Foreclosures Allowed in Alabama
Alabama statute allows for judicial foreclosures on defaulted property. This type of foreclosure, also known as foreclosure by judicial sale, involves selling the defaulted property under court supervision. In order for a judicial foreclosure to be possible, no power of sale clause may be present in the loan documents.
The lender may either file a lawsuit against the mortgagor or may sell the property to the highest bidder for cash in front of the courthouse door in the county where the property is located. The sale may not take place until a notice of the time, place and terms of the sale have been posted in a newspaper that is published within the county where the property is located for four (4) consecutive weeks.
The state of Alabama also allows for a non-judicial foreclosure, which is also known as foreclosure by power of sale. In order for non-judicial foreclosures in Alabama to be possible, the loan documents must contain a power of sale clause. The purpose of the clause is to authorize the lender to sell the property in the event of default to be able to recover what is owed on the property.
The difference between non-judicial foreclosures and judicial foreclosures is that non-judicial foreclosures allow for the property to be sold without court supervision. This type of foreclosure process is usually much faster and less expensive than a judicial foreclosure.
There are two ways in which a non-judicial foreclosure in Alabama can proceed. If the power of sale clause states a specific time, place, and outlines terms of sale, then the lender must follow the procedure that is stated. If there is no specification, then the sale may take place in front of the courthouse of the county in which the defaulted property is located and the property will be sold to the highest bidder for cash. In Alabama, the sale of the foreclosed property may not take place until thirty (30) days after the last notice of sale has been published.
The notice of sale must be publicized in a newspaper that is published in the county in which the property is located once a week for four (4) consecutive weeks. If the defaulted property is under mortgage in more than one county, then the notice must be published in all the counties. The notice of sale must contain the time, place and terms of the sale as well as a description of the property. If there are no local newspapers in the county in which the property is located, then the notice shall be publicized in a newspaper that is published in an adjacent county for four (4) consecutive weeks.
Working with a Foreclosure Lawyer in Alabama
In these tough economic times, many mortgagors are finding it hard to keep up with payments. They may have experienced a pay cut or have lost their jobs, preventing them from being able to pay their mortgage on time. If this has happened to you and you are behind on your mortgage payments or have already received a notice of default, turn to a leading foreclosure lawyer in Alabama for help right away.
Foreclosure attorneys do whatever it takes to ensure you don’t lost your home. They will speak to lenders on your behalf and try to work out a plan of action in which everyone benefits. Your foreclosure lawyer may suggest mortgage modification, refinancing or even a temporary halt in payments. Since the process of foreclosing a property costs lenders money, if an adequate plan is proposed, your lender will most likely agree to it.
As a homeowner in Alabama, you have rights. Don’t wait another minute before contacting a top team of foreclosure lawyers in Alabama to prevent your home from being repossessed.