|
If you do not FULLY understand the foreclosure process outlined on this page and how it may apply to you please take advantage of our FREE consultation by clicking here.
Judicial foreclosure available: Yes
Non Judicial foreclosure available: Yes
Alabama allows foreclosure in one of three ways:
- by filing a lawsuit to foreclosure;
- by a foreclosure sale conducted in accordance with
the terms specified under a power of sale clause in the deed of trust or
mortgage, or
- if there is no power of sale clause, then by a public
sale at the courthouse steps.
Foreclosure by filing a lawsuit seeking a court order
to foreclose is not common. Methods two and three are more commonly used.
Power of Sale Foreclosure
Preliminary Notices
Advertising
The sale may not take place until 30 days after
publishing an advance notice of the time, place and terms of the sale once a
week for four consecutive weeks. The notice must be published in the county in
which the property is located.
Sale Procedures
Documents May Specify Procedures
If the mortgage or deed of trust contains a power of
sale clause and specifies the time, place and manner of the foreclosure sale,
then that procedure must be followed.
Statutory Procedure
However, if the mortgage or deed of trust with a power
of sale clause is silent as to the place of terms of the sale, or as to the
type of notice of the sale, then a foreclosure sale may be made at the
courthouse door of the country where the property is located, after a breach of
the conditions or requirements of the mortgage, or deed of trust, by selling
for cash to the highest bidder. However, in the case of a sale under a
mortgagee or deed of trust with a power of sale clause, a foreclosure deed
conveys the title.
Foreclosure Without a Power of Sale Clause
If the mortgage or deed of trust lacks a power of sale
clause and the lender chooses not to file a lawsuit to foreclose, then the
lender may foreclose by selling the property for cash to the highest bidder at
the courthouse door in the county where the property is located. Advance notice
of the time, place, terms and purpose of the sale must be given by publishing
an ad once a week for four consecutive weeks in a newspaper in the county where
the property is located.
Deficiency
The lender may sue to foreclose the mortgage without
filing a suit to obtain a deficiency judgment. Alternatively, the lender
may sue to foreclose, and then sue for any resulting deficiency. It is the
lender’s choice.
Redemption
The borrower has a right to redeem within one year after
the foreclosure. Anyone who wants to redeem should obtain a statement of the
price paid for the property at the foreclosure sale from whoever bought the
property at the foreclosure sale. The borrower can then redeem the property by
paying the purchase price, taxes, insurance, improvements and ten percent
interests on the price and all other the legitimate charges to the purchaser.
If necessary, the borrower can sue in the circuit court to redeem the
property. |
