I was speaking with an experienced real estate professional the other day and the comment was made to me that probate judges in Alabama decide whether a foreclosure will happen or not.
So I wanted to address this issue or question.
How does a foreclosure happen in Alabama?
Here are the steps:
1. You get a default letter telling you that you are in default (usually not making payments) and that you have 30 days to fix the default;
2. You get an acceleration letter telling you the whole loan is now due at once (“accelerated”) and the foreclosure date is usually set;
3. The actual foreclosure occurs outside the front entrance to the courthouse.
What happens at the actual foreclosure sale?
The auctioneer actually reads the information about the foreclosure — the property description, etc. Then the bidding begins. Almost always the high bidder is the mortgage company or the “investor” behind the scenes such as Fannie Mae, Freddie Mac, etc.
What role does the probate judge have in foreclosures in Alabama?
The mortgage company (or the foreclosure lawyer) will prepare and file a foreclosure deed which is where you sell the property to the high bidder. This gets recorded in the probate court records.
But the probate judge does not approve or disapprove of the foreclosure. Sometimes people go to the judge and demand the probate judge not allow a foreclosure — this does nothing as that is not the judge’s role.
(Probate judges are vitally important but this is outsider their “jurisdiction” or their power to act).
How do you stop a foreclosure?
So if you can’t go to the probate judge to stop a foreclosure, how do you stop one?
1. Bankruptcy — extreme option but sometimes this works.
2. Loan modification.
3. Loss mitigation.
4. Sue the mortgage company.
There are many options but you have to figure out the right one for you. We have a 5 part process to help you do this and we make this available at no charge.
What to do next?
Go to our 4 part video series on saving your home from foreclosure — there is a lot of work involved in this video series along with the workbook we will email you.
If you are looking for an “easy button” then you will be disappointed in this series. But if you are serious about saving your home, then this will be very helpful to you if you live in Alabama.
You can also call us at 205-879-2447 and we will be glad to help you think through your options.