Alabama Foreclosure Laws

In Alabama, it is rare for the judicial system to intervene in the process of foreclosure. This is because most mortgages issued in Alabama contain what is known as a Power of Sale clause, which enables the lender to pursue a foreclosure without a court ruling if the borrower (homeowner) is found to be in default of payment. The only instances that might require court proceedings are if the mortgage lacks such a provision, or if there are problems with the property title itself.

Although it is not required under state law, some Alabama mortgages stipulate that the lender must send a Notice of Default to the homeowner informing them of the impending repossession of their property. The homeowner is generally given anywhere from 10-30 days to respond, after which point a date is set for the sale of the property and the foreclosure process begins. Unless the mortgage states otherwise, the homeowner has the right to stop the foreclosure process at any point up until the sale date by paying off their outstanding debt to the lender.

Although it is not required under state law, some Alabama mortgages stipulate that the lender must send a Notice of Default to the homeowner informing them of the impending repossession of their property. The homeowner is generally given anywhere from 10-30 days to respond, after which point a date is set for the sale of the property and the foreclosure process begins. Unless the mortgage states otherwise, the homeowner has the right to stop the foreclosure process at any point up until the sale date by paying off their outstanding debt to the lender.

In order to inform the public of the upcoming property foreclosure auction, the lender issues a Notice of Sale containing the time, location, and terms of the sale. This notice is either published in a local newspaper or posted on the courthouse door and other public venues. Ordinarily, the Notice of Sale is also sent to the homeowner in default, although this is not required unless called for in the mortgage agreement.

On the date of the foreclosure sale, which usually takes place at the town or county courthouse, the property is auctioned off to the highest bidder. Once the winning bidder has paid the agreed price in full, he is issued a deed to the property.

From start to finish, the entire process of foreclosure takes from two to three months. The original homeowner retains the right to redeem the property up to one full year after the foreclosure sale date.

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