New Alabama laws as of Jan. 1, 2016

Property foreclosure is a situation in which a homeowner is unable to make full principal and interest payments on his/her mortgage, which allows the lender to seize the property, evict the homeowner and sell the home, as stipulated in the mortgage contract. One month after the homeowner misses a home loan payment, he/she is in default and will be notified by the lender. Three to six a few months after the homeowner does not show for a mortgage payment, assuming the mortgage is still delinquent, and the house owner has not composed the missed payments within a specified grace period, the lender will start to foreclose. The particular farther behind the debtor falls, the more difficult it becomes to capture up since lenders add fees for payments that are 10-15 days past due.

Each state has the own foreclosure laws covering the notices the lender must post publicly and/or with the homeowner, the homeowner's selections for bringing the loan current and avoiding foreclosure, and the process for selling the property. In twenty two states – including Fl, Illinois, and Ny : judicial foreclosure is the norm, meaning the lender must go through the courts to get authorization to foreclose by proving the borrower is delinquent.

If the foreclosure is approved, the local sheriff sales the house to the maximum bidder to attempt to recoup what the bank is due, or the bank becomes the owner and markets the home through the traditional route to recoup the loss. The entire legislativo foreclosure process, from the borrower's first, missed payment through the lender's sale of the home, usually takes 480 to 700 times, in accordance with the Mortgage Bankers Organization of America.

The other 28 states – including Arizona, California, Georgia and Texas – mainly use non-judicial foreclosure, also known as the power of sale, which is often faster and will not go through the courts unless the house owner sues the lender.

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