So when someone in Alabama says they are “facing a foreclosure,” this can mean different things because we really have three stages to a foreclosure. We have written this article to give you an overview of these three typical stages in an Alabama foreclosure.
Alabama is a non judicial foreclosure state which means that a foreclosure does not have to go through the court system. This is different from judicial foreclosure states such as Florida. (Important — you can sue your mortgage company before the actual foreclosure sale to turn it into a “judicial” type of foreclosure).
A lot depends on where you are — if in Alabama then 90 days is normally enough time to foreclose but you will have some options to stop the foreclosure. Several things to consider. Having income to pay your mortgage now is critical — hard to help someone who can’t afford their mortgage.
Your mortgage will normally allow you the absolute right to reinstate if you do so at least five days before the foreclosure. Find out how the mortgage company wants you to do this — every detail:
Alabama foreclosures are “non-judicial” which means no judge is involved. But you have the right, under almost every mortgage, to bring a lawsuit before a foreclosure to have a judge look at your claims and defenses.
If the answer is “yes” then the foreclosure should stop as that’s the whole point of loss mitigation. If the answer is “no” then you will be told why you do not qualify. You may then want to appeal or challenge that decision. But while you are waiting on a “yes” or “no” decision, the foreclosure should be stopped.
In Alabama, a notice has to be placed in the newspaper for three consecutive weeks prior to the sale. It must be placed in the local newspaper in the county in which the home is located. While the foreclosure is still in this stage, it is usually possible for homeowners to work out a deal with the mortgage company.
There are three stages to a foreclosure in Alabama. The first stage is what happens before the home is put up for sale. The second is what happens after the home is sold. The third occurs only if the person who lost the home doesn't move out after the home is sold.
It also has to include how to cure the default and what is included in the default. In most cases, the foreclosure sale can occur 30 days after the default letter is served.
Stage Two. If a homeowner is unable to cure the default to the satisfaction of the mortgage holder, the sale on the home can proceed. An important point here is that the sale must take place at the place noted in the newspaper ads on the date specified. If the sale occurs anywhere else or at any other time, the sale is an illegal sale.
If the judge rules in the new owner's favor, the court will order the eviction. That would mean the former owner would have to move immediately. With the short time span from missing a mortgage payment to the home being sold at an auction, it is vital for Alabama homeowners who are facing foreclosure to take swift action.
When people don't move out of a home they lost to a foreclosure within the time specified by the mailed notice sent from the new owner, the new owner can go to court to have them forcibly removed. This is called the ejectment lawsuit. If the new owner opts to do this, the former owner will have 30 days to answer the lawsuit. Some people choose to answer the lawsuit to try to fight the eviction. Others choose to ignore the lawsuit. In that case, a default judgment is issued.
When the sale on the foreclosed home goes through in a legal manner, the new owner of the home can send a letter to the former homeowner giving 10 days to move out. This brings up a choice. The person who lost the home can choose to ignore the eviction notice and remain in the home or the person can move out within the specified time.
The laws that govern foreclosures are contained in Alabama Code (1975) Foreclosure sales are covered in Title 35 (Property) Articles 1 , 1A , 2 , 3 §35-10-1 et. seq. (Powers Contained in Mortgages, Foreclosure by Power of Sale). To view these statutes on the Web, you can visit:
The primary method of foreclosure in Alabama involves what is known as non-judicial foreclosure. When the mortgage is initially signed it will usually contain a provision called a power of sale clause, which upon default allows an attorney to foreclose on the property in order to satisfy the underlying defaulted loan.
Depending on the timing of the various required notices, it usually takes approximately 60-90 days to effectuate an uncontested non-judicial foreclosure. This process may be delayed if the borrower contests the action in court, seeks delays and adjournments of sales, or files for bankruptcy . top.
The document that secures the title is usually called a deed of trust or mortgage. In Alabama, the mortgage serves the same purpose and generally contains the same terms as a deed ...
The lender must then publish a notice of foreclosure sale date for three (3) weeks in a newspaper of general circulation in the county in which the property is located. If there is no such newspaper in the county in which the property is located, then the newspaper in an adjacent county may be used.
The borrower may make payment and discontinue the foreclosure process provided the payment is made prior to the foreclosure sale and all costs and fees are paid in full.
In Alabama, the mortgage serves the same purpose and generally contains the same terms as a deed of trust and serves the same function in a non-judicial foreclosure . top.