Alabama Foreclosure Law

Foreclosure in Alabama typically lasts 30 to 60 days, although timelines can vary widely according to the judicial process followed. The foreclosure process can start without a Notice of Default, but some mortgages require the lender to send one 10 to 30 days in advance.

State law allows both judicial and non-judicial foreclosure, which means that a lender can foreclose whether or not there is a Power of Sale clause in the contract. This clause makes it possible to sell the property to pay off the loan in case the borrower defaults.

Judicial foreclosure
If the clause doesn’t exist in the mortgage, the lender has to take the case to court before they can foreclose. This is called a judicial foreclosure. However, lenders can also choose to skip the lawsuit and auction off the home at the country courthouse where the home is located. The auction has to be announced in a local newspaper stating the date, time, purpose, and location of the sale. The ad has to be up for at least four consecutive weeks before the sale date.

Non-judicial foreclosure
A non-judicial foreclosure is done when the mortgage contains a Power of Sale Clause specifying complete details of the sale. In this case, the Power of Sale guidelines will be followed. If the clause is present but doesn’t mention specific details, the lender can auction the home off in the same manner as a judicial foreclosure. The ad has to be published in a local paper (if the mortgage is under more than one county, it has to be published separately in each one) for at least 30 consecutive days.

In both processes, if the foreclosure sale isn’t enough to cover the debt, the court issues a Deficiency Judgment. This gives the lender a personal claim against the borrower to pay off the remaining debt on top of the foreclosure.

Homeowner’s rights
Homeowners under foreclosure are given a 12-month Right of Redemption. This means that they are a 12-month time frame, from the start of the foreclosure process, during which they can get current and regain possession of their home.

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