Alabama Revises Provisions Regarding Right of Redemption
Alabama has enacted HB90 which amends current law regarding the 180 day right of redemption period after a foreclosure sale. HB90 provides that the right of redemption cannot be exercised more than one year after the date of foreclosure, that the production of proof of mailing of the notice of right of redemption is an affirmative defense to any notice requirement action, and bars any action related to the notice requirement if brought more than one year after the foreclosure sale.
Current law provides that a debtor, mortgagor, junior mortgagee, judgment creditor, a transferee, spouse of a debtor, children, heirs, or devisees of any debtor may redeem a property subject to a residential foreclosure within 180 days from the date of the sale so long as the residential property was subject to a homestead exemption claimed in the tax year the sale occurred or within one year of the date of the sale for all other property.
Current law also provides that a foreclosing mortgagee is required to give notice to the mortgagor of their right of redemption. The notice must be mailed to the mortgagor at the property address at least 30 days prior to the foreclosure sale date. The notice must be mailed certified mail with proof of mailing and must contain the following language:
“Alabama law gives some persons who have an interest in property the right to redeem the property under certain circumstances. Programs may also exist that help persons avoid or delay the foreclosure process. An attorney should be consulted to help you understand these rights and programs as a part of the foreclosure process.”
Under HB90, the redemption period begins upon mailing of the notice of redemption, but no property may be redeemed later than one year after the foreclosure sale. Defective notice or failure to give notice does not invalidate the foreclosure. Additionally, the proof of mailing of the notice constitutes an affirmative defense to any notice requirement action. Further, any action regarding the notice requirement must be brought within one year after the foreclosure sale.
The provisions of HB90 take effect immediately and the full text may be found here: http://alisondb.legislature.state.al.us/ALISON/SearchableInstruments/2018RS/PrintFiles/HB90-int.pdf
Adam Faria, JD, is a regulatory compliance consultant with CLA. He is a graduate of Northeastern University and earned his juris doctor at Suffolk University Law School. He is admitted to the bar in Massachusetts and New Hampshire.
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