Despite your best efforts and intentions, a homeowner may fall behind in making their mortgage payments–maybe this is caused by a loss of income or a major illness. Maybe the lender promised mortgage help that was never delivered. When this happens, your mortgage lender may take steps to foreclose on your property and sell it to regain the money they claim they are owed.
At Hood Law we understand the worries and frustrations many homeowners face when there is a foreclosure looming. We will work with your interests in mind and use our resources strategically. If you are facing a foreclosure in Alabama, contact us today at (205) 323-4123 to schedule a consultation. If you are facing a foreclosure in North Florida, contact us at (850) 427-2889
What Happens During a Foreclosure?
Foreclosure is an action a lender takes to gain title to a home on which they currently have a mortgage. Most foreclosures occur when a borrower has failed to make their mortgage payments. In most cases, you must be a minimum of 120 days delinquent in order for a lender to initiate foreclosure proceedings when you fall behind. However, other defaults in the mortgage can trigger a foreclosure. This is why it is imperative you contact a knowledgeable attorney to understand your rights and to gain insight into what you may encounter throughout the foreclosure process and how to defend it.
In Florida the process is a judicial one and the lender must go through the court system to foreclose. In a judicial foreclosure, the lender (mortgagee) will file a suit against the homeowner (mortgagor) in the appropriate civil court. The mortgagee typically has a specified amount of time to respond, and a hearing may be held regarding the foreclosure action. The parties may be able to come to some sort of agreement at this point. If an agreement is not made and the court finds that the foreclosure is appropriate, a judgment for foreclosure will be entered. The property will then be sold at a public auction. If the sale does not bring enough money to repay the loan amount that was borrowed, the lender may seek a deficiency judgment against the mortgagor. The process, from start to finish, can take many months. Failure to respond to the lawsuit will result in a default judgment against the borrower, so it is important to timely respond if you believe you have a defense to the foreclosure.
In Alabama the process is administrative, and a lender may be able to foreclose, without involving the courts, in as little as 3 weeks. In a non-judicial foreclosure, the lender (mortgagee) does not have to file suit but instead publishes the time and date of the foreclosure sale. Then at the published date, a private auctioneer, working for the lender conducts the foreclosure sale. The sale should be conducted in the county where the property is located at the front of the County Courthouse and called at public outcry. This process is much faster than a judicial foreclosure sale. However, many borrowers have a right to file a lawsuit to challenge the foreclosure sale before it occurs. And in some instances, the borrower may have challenges even after a foreclosure sale has been completed.
Common Defenses to Foreclosures in Alabama & North Florida
Some defenses to foreclosure sale that may be asserted are listed below.
- Fraud: When fraud or undue influence is used to induce a party to sign a mortgage, it can usually be used as a defense in the foreclosure action.
- Violations of Law: Most jurisdictions, especially those that have a judicial foreclosure process, have requirements on the type and amount of notice that must be given to mortgagors in the foreclosure process. If the lender fails to abide by those laws, it can be a defense to foreclosure.
- Violations of the Mortgage: Many mortgages have specific requirements on the type and amount of notice that must be given to mortgagors before the foreclosure sale can take place. A lender's failure to abide by the notice requirements can be a defense to foreclosure.
- Scams: When the mortgagor is the victim of a scam, such as predatory lending, or a forged mortgage, they may be able to use the scam as a defense to the foreclosure action.
If you are facing a foreclosure, it is in your best interest to seek a foreclosure defense attorney in your area. This is not an exhaustive list of defenses. They may know other defenses that are available to you, as well as other options to avoid foreclosure.
What Are Your Rights in a Foreclosure Proceeding in Alabama & Florida?
Before initiating foreclosure, your lender should send you a letter listing the amount you need to pay, by a certain date, to avoid foreclosure. Your lender, or the company that services the loan for your lender, should also try to contact you to explain your options for loss mitigation, which is a process where you work out an agreement with your lender to avoid foreclosure.
In Florida when the judicial foreclosure proceedings are initiated, you will receive a summons and complaint from the Clerk of Court which initiates the actual foreclosure.
In an Alabama non-judicial foreclosure, you will most likely receive a Notice of Default (NOD). A NOD provides the borrower with notice of the default of your loan, should provide you with how to cure the default, and your rights under the mortgage. If the default is not cured by the date stated in the NOD, you should expect to receive a Notice of Acceleration, which calls the entire loan due. You should also expect to receive a Foreclosure Sale Notice which states that the property will be sold at auction, along with details of the date and place of the auction.
Lenders should also discuss and provide borrowers different options to avoid foreclosure.
Do You Need a Foreclosure Lawyer?
When facing the possible loss of your home, it is a good idea to seek counsel from a foreclosure attorney that understands the process. They can help you navigate the foreclosure while minimizing your losses.
Other instances where a foreclosure defense lawyer is most beneficial include situations where:
- You have a loan backed by the Federal Housing Administration (FHA), which may qualify you for additional aid to help you keep your home
- You are an active or former military service member, which may qualify you for protection under the Servicemembers Civil Relief Act (SCRA)
- You want to keep your home but your legal options are limited, in which case a lawyer may be able to negotiate with the lender a positive outcome for you
- You think you have a valid defense, in which case a lawyer may be able to identify, support, and successfully argue on your behalf
Navigating the foreclosure process can be overwhelming in an already stressful situation. A foreclosure defense attorney can alleviate some of that stress and help find options you may not have thought you had.
Contact a Foreclosure Defense Attorney in Alabama & North Florida Today
At Hood Law, we understand that sometimes bad things happen to good people, and we know that facing a foreclosure can be extremely stressful and frustrating. Contact us at (205) 323-4123 (Alabama), (8504272889 (Florida), or by filling out our online contact form to schedule a consultation to learn how we can help you prevent a foreclosure or discuss options to set aside a completed foreclosure sale.