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American College of Mortgage Attorneys — Partner with the Best®

Formed in 1974, the American College of Mortgage Attorneys (ACMA) is comprised of over 500 lawyers in North America who are experts in mortgage law.

United States

Alabama

Mortgage. Ala. Code §&nbsp;35-10-11(1)<a href="#_ftn1" name="_ftnref1">[1]</a>. A vendor may obtain a lien in a conveyance by retaining title to secure balance of purchase price without the necessity of a mortgage. Stagg v. Van Sant, 390 So. 2d 620, 622 (Ala. 1980). Mortgage passes legal title to the mortgagee with the mortgagor left with the equity right of redemption. Ala. Code §&nbsp;35-10-5; In re Haas, 31 F.3d 1081 (11th Cir. 1994).

SECURITY INSTRUMENT USED

Mortgage is valid between mortgagor and mortgagee whether recorded or not. It must be recorded to constitute notice to third parties. Ala. Code &sect;&nbsp;35-4-90(a). See Ala. Code &sect;&sect;&nbsp;35-4-20 and 35-4-23 for requirements of witnesses and use of acknowledgment by a notary public as satisfying requirements of witnesses.

RECORDING REQUIREMENTS

Specific forms for use in preparation of acknowledgments are found in Ala. Code &sect;&nbsp;35-4-29 and substantial compliance is required. Ala. Code &sect;&nbsp;35-4-26 prescribes the officer authorized to take acknowledgments outside of the State of Alabama and beyond the limits of the United States as well as the form of those acknowledgments. An acknowledgment executed in a state outside the State of Alabama that is in compliance with the manner and form prescribed by the laws of the place of its execution and is verified by the official seal of the officer before whom it is acknowledged, has the same effect as an acknowledgment prescribed by law for instruments executed in Alabama. Ala. Code &sect; 35-4-26(b). The use of remote notarization for acknowledgments is authorized Ala. Code &sect; 36-20-73.1.&nbsp; All mortgages and other instruments affecting title to real estate that were acknowledged via remote notarization before July 1, 2021 are ratified and confirmed. Ala. Code &sect; 36-20-73.1(g).

FORM OF ACKNOWLEDGMENT

Homestead of spouses, Ala. Code &sect;&nbsp;6-10-122, and personal exemption from debt, Ala. Code &sect;&nbsp;6-10-121.

STATUTES TO BE WAIVED

Debt may not be prepaid unless provision permits. Ex parte Brannon, 683 So.2d 994 (Ala. 1996). Reasonable penalties are permitted if condition of prepayment. However, there is a statutory right of prepayment without penalty for certain debts subject to Alabama's Consumer Credit Code. Ala. Code &sect; 5-19-4.

UNUSUAL TREATMENT OF STANDARD PROVISIONS

If mortgage provides, future advances are secured up to amount of recited indebtedness. In re Grocers' Baking Co., 266 F. 900 (N.D. Ala. 1920). Any amount in excess of face amount of mortgage must be evidenced by certificate filed of record reciting additional advances. Any intervening lienholders will have preference over the amount of the advances in excess of face amount of mortgage.

SECURING FUTURE ADVANCES

Additional advances to protect the collateral, including taxes and insurance, are secured by mortgage if mortgage so provides. Guar. Sav. Bldg. & Loan Ass'n v. Russell, 221 Ala. 32, 34, 127 So. 186, 187 (1930). If not provided for in the mortgage, it may have to be established by the court.

SECURING ADDITIONAL ADVANCES TO PROTECT THE COLLATERAL, INCLUDING PAYMENT OF TAXES AND INSURANCE

TRUSTEE UNDER DEED OF TRUST

For mortgages executed after December 31, 1988, notice must be given by publication in a newspaper once a week for 3 consecutive weeks published in the county or counties in which the property is located, setting the date of sale and including a description of the property. Ala. Code &sect;&nbsp;35-10-13. The sale must be conducted between the hours of 11:00 a.m. and 4:00 p.m. at the front or main courthouse door of the county where the property is located, Ala. Code &sect;&nbsp;35-10-14, and may be conducted by any person, or the personal representative of any person, who, by assignment or otherwise, becomes entitled to the money thus secured. Ala. Code &sect;&nbsp;35-10-12. If a mortgage contains a power of sale, the mortgagee or its agent may sell the property to the highest bidder at a non-judicial foreclosure sale, with proceeds applied to the cost of the sale, including attorney's fees, and to the indebtedness, with any excess amount remitted to the mortgagor. Ala. Code &sect;&sect; 35-10-1, 35-10-12. If a mortgage does not contain a power of sale, it may be foreclosed by a court proceeding. Ala. Code &sect; 35-10-3. Similar requirements apply to mortgages executed on or before December 31, 1988, Ala. Code &sect;&sect;&nbsp;35-10-1 - 35-1-10, but for such pre-1989 mortgages that are silent as to the place or terms of the sale, notice must be given by publication for 4 consecutive weeks. See Ala. Code &sect;&sect;&nbsp;35-10-2, 35-10-3. For mortgages entered into after August 1, 2009, if the surviving spouse or the estate of a mortgagor who is a service member who dies while deployed overseas on active duty military service gives written notice to the mortgagee with the statutorily-required information and asks that the foreclosure be delayed for 6 months, the mortgagee is prohibited from initiating a foreclosure proceeding for 180 days following the death of the service member. Ala. Code &sect;&nbsp;35-10-71(a). A civil fine for violation of that requirement is set forth in &sect;&nbsp;35-10-71(b).

BRIEF DESCRIPTION OF PROCEDURE

Public auction and date of sale is normally set 1 week after the 3-week consecutive publication of notice of sale. Ala. Code &sect;&nbsp;35-10-8.

TYPICAL LENGTH OF PROCEDURE

As detailed above, if the mortgage contains a power of sale, the property may be sold at a non-judicial foreclosure; without a power of sale, the property may be sold by court proceeding. See Ala. Code &sect;&sect; 35-10-1, 35-10-12,&nbsp;35-10-3. If part of the mortgaged property is sold, any remaining mortgage indebtedness continues as a lien against the unsold property as security for the balance of indebtedness. See Ala. Code &sect;&sect;&nbsp;35-10-6, 35-10-15. Deeds in lieu of foreclosure are allowed but only transfer a mortgagor's interest (equity right of redemption) and do not affect rights or interests of third parties. Ala. Code &sect;&nbsp;35-10-51.

FORECLOSURE BID REQUIREMENTS

Persons listed in Ala. Code &sect;&nbsp;6-5-248(a)(1)-(a)(7) have a 180-day statutory right of redemption for residential properties on which a homestead exemption was claimed in the tax year during which the sale occurred. Ala. Code &sect; 6-5-248(b); but see &sect; 6-5-248(h) (right of redemption does not begin to run until proper notice is given to mortgagor). All properties not covered in Ala. Code &sect; 6-5-248(a)(1)-(a)(7) carry a one-year right of redemption. The redemption price is the amount of the foreclosure sales price with interest at the rate allowed by law on money judgments (see Ala. Code &sect; 8-8-10), plus the value of permanent improvements, taxes, insurance premiums and any valid lien or encumbrance discharged. Ala. Code &sect;&nbsp;6-5-253(a). If redeeming from the owner of the debt secured by the property, any remaining balance of the debt must also be paid with interest at the rate allowed to be charged on money judgments as set forth in Section 8-8-10. Id. The redeeming party is entitled to a credit against the redemption price if, during the redemption period, the purchaser cuts or sells timber, removes oil, gas or minerals, or demolishes any improvements on the mortgaged property. Ala. Code &sect;&nbsp;6-5-253(d). The mortgagor must deliver possession within 10 days of written demand for possession. The mortgagor (or anyone holding possession) loses the right of redemption if they fail to deliver possession within the 10-day period. Ala. Code &sect;&nbsp;6-5-251(a), (c). Absent notice to deliver possession to the mortgagor, the mortgagor may continue in possession after foreclosure as a tenant at will; if the mortgagor fails to deliver possession after being given notice, the mortgagor remains in possession as a tenant at sufferance. Paint Rock Turf, LLC v. First Jackson Bank, 169 So. 3d 990 (Ala. 2014). For residential property on which a homestead exemption was claimed in the tax year during which the sale occurred, the mortgagee must provide the mortgagor with the notice set forth in Ala. Code &sect;&nbsp;6-5-248(h), which must be mailed to the mortgagor at the address of the property subject to foreclosure at least 30 days prior to the foreclosure date by certified mail with proof of mailing. In this situation, the time period in which a right of redemption may be exercised does not begin until this notice is given, although no right of redemption may be exercised later than one year after the date of foreclosure. See id.

REDEMPTION PERIOD AND PRICE

May not waive right of redemption prior to foreclosure sale but may waive or assign after sale. Ala. Code &sect; 6-5-250.

WAIVER OF REDEMPTION; REDUCTION OF REDEMPTION PERIOD

Any deficiency remains the mortgagor's debt, subject to suit for collection under the note. Generally, the mortgagee may sue under the mortgage note after default. The statute of limitations, if under seal, is 10 years; otherwise, 6 years after default on foreclosure.

DEFICIENCIES

Any lease executed after the mortgage is not binding upon the mortgagee, Mack v. Beeland Bros. Mercantile Co., 21 Ala. App. 97, 105 So. 722 (Ala. 1925), and any lease executed prior to the mortgage is binding upon the mortgagee upon the tenant attorning to the mortgagee. The mortgagee accedes to the lessor's rights under the lease, including the right to intercept the rent. Any lease after the recording of the mortgage is extinguished on foreclosure. The mortgagee is entitled to all rents and profits paid or accrued after foreclosure, until the date of redemption. Homecorp v. Secor Bank, 659 So. 2d 15 (Ala. 1994); Md. Casualty Co. v. Owens, 261 Ala. 446, 74 So.2d 608 (Ala. 1954); Henderson v. Coon, 244 Ala. 324, 13 So.2d 564 (Ala. 1943).

EFFECT OF FORECLOSURE UPON LEASES

No ceilings on loans in excess of $2,000, the only restriction being unconscionability, Ala. Code &sect;&nbsp;8-8-5. Lending individuals, banks, corporations, and other legal entities may charge the same interest rate under the same conditions as any federal or state chartered lending institution whose principal place of business is Alabama. Ala. Code &sect;&nbsp;8-8-1.1.

USURY CEILING

Debts incurred pursuant to National Housing Act or Veteran's Benefits, Ala. Code &sect;&nbsp;8-8-6, and bond notes of state or localities instrumentalities, Ala. Code &sect;&nbsp;8-8-7.

USURY EXEMPTIONS

If the local law of this State governs perfection of a security interest or agricultural lien, the office in which to file a financing statement to perfect the security interest or agricultural lien is:<ol><li>The office designated for the filing or recording of a record of a mortgage on the related real property, if:<ol><li>the collateral is as-extracted collateral or timber to be cut; or</li><li>the financing statement is filed as a fixture filing and the collateral is goods that are or are to become fixtures; or</li></ol></li><li>The office of the Secretary of State, in all other cases, including a case in which the collateral is goods that are or are to become fixtures and the financing statement is not filed as a fixture filing. Ala. Code § 7-9A-501(a).</li></ol>

LOCATIONS FOR FILING

A record of a mortgage is effective, from the date of recording, as a financing statement filed as a fixture filing or as a financing statement covering as-extracted collateral or timber to be cut only if:<ol><li>the record indicates the goods or accounts that it covers;</li><li>the goods are or are to become fixtures related to the real property described in the record or the collateral is related to the real property described in the record and is as-extracted collateral or timber to be cut;</li><li>the record satisfies the requirements for a financing statement in this section, but:<ol><li>the record need not indicate that it is to be filed in the real property records; and</li><li>the record sufficiently provides the name of a debtor who is an individual if it provides the individual name of the debtor or the surname and first personal name of the debtor, even if the debtor is an individual to whom Section 7-9A-503(a)(4) applies; and</li></ol></li><li>the record is recorded, Ala. Code § 7-9A-502.</li></ol>

SECURITY INSTRUMENT USED AS FIXTURE FILING

The recording of a mortgage that satisfies the requirements for a financing statement constitutes the filing of a financing statement. Ala. Code &sect; 7-9A-502(c). A record of a mortgage that is effective as a financing statement filed as a fixture filing under Section 7-9A-502(c) remains effective as a financing statement filed as a fixture filing until the mortgage is released or satisfied of record or its effectiveness otherwise terminates as to the real property. Ala. Code &sect; 7-9A-515(g). Section 7-9A-515(g) does not however, list timber to be cut or as extracted collateral along with fixtures. Accordingly, with respect to a mortgage filed as a financing statement covering timber to be cut or as extracted collateral, Section 7-9A-515(a) would appear to apply (thus requiring the filing of continuation statements within six months prior to the expiration of each five-year period following the original filing of the financing statement covering timber to be cut or as extracted collateral) in order to continue the perfection of the security interest therein perfected by the filing of the mortgage as a financing statement covering timber to be cut and as extracted collateral. See Ala. Code &sect; 7-9A-515(a).

RECORD OF MORTGAGE AS FINANCING STATEMENT

UNUSUAL PROVISIONS OR REQUIREMENTS

Homestead and personal exemptions.

Those of suing under written instrument would apply.

SPECIAL PROBLEMS IN ENFORCEMENT OF GUARANTY

A continuing personal guaranty for payment regarding further acts is only an offer and may be unilaterally revoked by the guarantor if the guarantor provides the requisite notice of revocation to the creditor. However, the parties may include a provision in the guaranty agreement requiring consent of the creditor in order to revoke the guaranty. Barnett Millworks, Inc. v. Guthrie, 974 So.2d 952 (Ala. 2007).

CONTINUING GUARANTY

Redemption: within 180 days from the date of the sale for residential property on which a homestead exemption was claimed in the tax year during which the sale occurred, or within one year from the date of the sale for all other property. Ala. Code &sect;&nbsp;6-5-248(b). Note under seal, 10 years from default, Ala. Code &sect;&nbsp;6-2-33; otherwise 6 years, Ala. Code &sect;&nbsp;6-2-34.

STATUTE OF LIMITATIONS PERIOD

Holder of recorded lien who has received payment in full or partial payments of the debt secured, must, upon request in writing, enter the amount and date of such payment and the amount of debt remaining unpaid on the margin of the recorded lien. Ala. Code &sect; 35-10-21. Entry on record date of payment usually by written instrument filed of record in the Probate Office in the County in which the lien is located. If the lienholder fails to make an entry after 30 days of written request to do so, the holder must forfeit to the requesting party $200.00 (unless an action is brought within the 30-day period to contest partial payment or satisfaction). Ala. Code &sect;&nbsp;35-10-30(a).

REQUIREMENTS FOR RELEASE OF LIEN

No mortgage, deed or other conveyance of the homestead by a married person shall be valid without the voluntary signature of the husband or wife, acknowledged by a notary public. Ala. Code &sect;&nbsp;6-10-3.

HOMESTEAD ISSUES

COMMUNITY PROPERTY

15&cent; per $100 or fraction thereof, plus a fee for recording each page of the document, local fees for indexing and for number of parties in excess of 2 unless husband and wife. Recording charges may vary from county to county. Ala. Code &sect;&nbsp;40-22-2. On loan transactions where collateral consists of real property both within and outside the State of Alabama, an order from the Alabama Department of Revenue determining the appropriate mortgage tax amount to be paid with respect to the Alabama collateral is available (Ala. Code &sect;&nbsp;40-22-2(8)) and is recommended prior to presenting the mortgage for recordation.

MORTGAGE TAX

DOCUMENTARY STAMP TAX

On value of property transferred, 50¢ per $500 or fraction thereof, less a credit for mortgage taxes paid on a mortgage recorded simultaneously with the recording of the deed. Ala. Code §&nbsp;40-22-1.On Foreclosure Sale: 50¢ per $500 or fraction thereof on the sales price. If bid in by the mortgagee, tax to be paid only on the amount in excess of the original mortgage amount.On Deed in Lieu of Foreclosure: 50¢ per $500 or fraction thereof on the consideration.

TRANSFER TAX OR DEED TAX

Prior to Alabama Constitutional Amendment No. 884: Generally applicable if parties conducted business within the State. Forum selection clauses are prima facie valid and should be enforced unless enforcement is shown to be unreasonable under the circumstances, or unfair because of fraud, undue influence or overwhelming bargaining power. Smith v. Professional Claims, Inc., 19 F.Supp.2d 1276 (M.D. Ala. 1998). Outbound forum-selection clauses are not void per se as against public policy. O'Brien Engineering Co., Inc. v. Continental Machines, Inc., 738 So.2d 844 (Ala. 1999); Professional Ins. Corp. v. Sutherland, 700 So.2d 347 (Ala. 1997).Alabama Courts will normally look at the convenience/inconvenience of the parties, including witnesses, their location, place of the making and enforcement of the agreement, as well as other circumstances in consideration of the enforcement of outbound forum selection clauses. 738 So.2d 844.After Amendment 884: In the general election of the State held on November 4, 2014, the voters of the State approved an amendment to the State Constitution (now codified as Amendment 884). Subsection (b)(6) of the Amendment states that the public policy of the State is to prohibit anyone from requiring State courts to apply and enforce foreign laws, and subsection (g) provides that no State court is required by any contract or other obligation entered into by any person or entity to apply or enforce foreign law. The Amendment defines “foreign law” as “any law, rule, or legal code, or system established, used, or applied in a jurisdiction outside of the states or territories of the United States, or which exist as a separate body of law, legal code, or system adopted or used anywhere by any people, group, or culture different from the Constitution and laws of the United States or the State of Alabama” (emphasis added). As a consequence of the adoption of Amendment 884, the law in the State on this issue has been rendered unclear.However, despite Amendment 884, Alabama case law has continued to follow traditional choice of law doctrines. LaBrake v. State Farm Mutual Automobile Insurance Company, 2021 WL 1603242 (N.D. Ala. 2021) (applying New York law where insurance contract contained choice of law provision stating New York law shall govern contract disputes); see also Protective Life Ins. Co. v. Apex Parks Grp., LLC, 2020 WL 5582229, at *9 (Ala. 2020); Blalock v. Sutphin, 275 So. 3d 519, 523 (Ala. 2018) (applying traditional choice of law doctrines). LaBrake also holds that “foreign law,” as used in Amendment 884, is limited to address international, not the laws of other states. Labrake, 2021 WL 1603242, at *6.

ENFORCEABILITY OF AGREEMENT OF BORROWER AND LENDER AS TO CHOICE OF LAW PROVISIONS

RECEIVER AVAILABLE

Normal credit and consumer law requirements, including truth-in-lending. Certain additional requirements for loans subject to Alabama's Consumer Credit Code. See Ala. Code &sect;&nbsp;5-19-4.

ANY PROHIBITION OR SPECIAL RULES REGARDING LOAN APPLICATION, LOAN FEES OR COMMITMENT FEES

Every owner of a manufactured home which is in the state and for which no certificate of title has been issued shall apply for a certificate of title to the manufactured home, Ala. Code &sect;&nbsp;32-20-20, and they are treated as personal property under the motor vehicle statutes. See Green Tree-AL LLC v. Dominion Resources, L.L.C., 104 So.3d 177, 184 (Ala. Civ. App. 2011). “Manufactured home” is specifically defined in Ala. Code &sect; 32-20-2(7). For the manufactured home to be considered part of the land on which it is situated and therefore subject to a real property mortgage lien, the owner of the manufactured home and the owner of the land must be the same, the manufactured home is to be permanently affixed to the land, and the certificate of title must be cancelled as provided in Ala. Code &sect;&nbsp;32-20-20(b). “Permanently affixed” means a manufactured home installed in accordance with the manufacturer's specifications as required by state law on the owner's land and taxed as real property. Ala. Code &sect;&nbsp;32-20-2(12). All new manufactured homes placed on the owner's land are exempt from the requirement of having a certificate of title when classified real property through the surrender of the manufacturer's certification of origin along with the copy of the owner's deed. Ala. Code &sect;&nbsp;32-20-20(b), Alabama Department of Revenue Motor Vehicle Division - Title Section has developed an appropriate form, which may be downloaded by going to www.ador.state.al.us. MODIFICATION - UNUSUAL PROVISIONS OR REQUIREMENTS FOR MODIFICATIONS OF EXISTING MORTGAGE LOANS: Certain refinancing requirements for loans subject to Alabama's Consumer Credit Code. See Ala. Code &sect;&nbsp;5-19-4(d), 5-19-7.

MANUFACTURED HOUSING; PERFECTION OF A LIEN ON HOME ATTACHED TO LAND

Alabama has enacted a lien that covers the fees, interest, and penalties imposed for the disposal of hazardous wastes. Ala. Code &sect;&nbsp;22-30B-9. The lien has the same priority as liens imposed under Alabama revenue laws. Id. The revenue laws give the state and local governments a lien on real and personal property, and it has priority over all other liens (Ala. Code &sect;&nbsp;40-1-3), including pre-existing liens. See BPH, Inc. v. Cochrane, 628 So. 2d 911 (Ala. Civ. App. 1993).

ENVIRONMENTAL LIEN LAW

A. INCEPTION OF LABOR AND MATERIALMEN'S LIEN (Priority of Lien of Deed of Trust or Mortgage): Any person who performs work or labor upon, or furnishes materials for, any buildings or improvements on land shall have a lien on the improvements and land on which the improvements are situated for the unpaid balance. If the laborer or materialmen, before furnishing any material, gives notice in the statutory form of certain specified material to be furnished to the owner prior to furnishing such material or performing any work, and if the owner does not object to the notice, the laborer shall have a lien for the full price thereof, even if it exceeds the unpaid balance. Ala. Code §&nbsp;35-11-210. Such lien has priority over all liens and encumbrances created after the commencement of the work and also has priority over prior liens and encumbrances as against the improvements only. Ala. Code §&nbsp;35‑11-211.Any lienholder who subordinates his lien to a mortgage also subordinates his lien to other liens having priority over the mortgage. Schwab v. Estes Lumber Co., 225 Ala. 452, 143 So. 829 (Ala. 1932). A materialmen's lien does not attach until work is begun on the job site or the materials have been incorporated into the buildings or improvements on the land. Gamble's, Inc. v. Kansas City Title Ins. Co., 283 Ala. 409, 217 So.2d 923 (Ala. 1969). A recorded mortgage takes precedence over the lien of a materialman for material delivered to the construction site after the mortgage is recorded. Covington County Bank v. R.J. Allen &amp; Associates, Inc., 462 F.Supp. 413 (M.D. Ala. 1977). As against mortgages, a mechanic's lien takes precedence according to the time when it attaches to the property it is improving, Gambill, Inc. v. Kansas City Title Insurance Co., 283 Ala. 409, 217 So.2d 923 (Ala. 1969), and is superior to any lien of a mortgage executed after the incorporation of any materials in the building. Schwab v. Estes Lumber Co., 225 Ala. 452, 143 So. 829 (Ala. 1932).Anyone claiming a materialman's or mechanic's lien must give statutory notice to the owner in order to perfect his lien, and then institute proceedings within the statutory period. The original contractor must file a verified statement of lien with the probate court within 6 months; every journeyman and day laborer must file within 30 days; and every other person entitled to a lien within 4 months after the last time of work or labor has been performed, or the last item of any materials or fixtures, has been furnished. Ala. Code §§&nbsp;35-11-213 and 35-11-215.A subcontractor, journeyman, or day laborer has a lien that attaches to the property for the balance owed by the owner or proprietor to the original contractor after advance notice to owner. Ala. Code §&nbsp;35-11-218.Any action to enforce a lien must be commenced within 6 months after the maturity of the entire indebtedness. Ala. Code §&nbsp;35-11-221.B. PRIORITY AS TO REMOVABLE FIXTURES (Priority of Lien of Deed of Trust or Mortgage): Materialman and mechanic's liens result from furnishing or performing work that has attached to and become part of the realty and increased its value. Wade v. Glencoe Lumber Co., 267 Ala. 530, 103 So.2d 730 (Ala. 1958). Fixtures placed in a building for use in the business may be removed without injury to the freehold if presumed to be trade fixtures and not intended as an additional improvement to the realty; hence materialman and mechanic's liens will not be attached to any such trade fixtures, but attach only to such property and fixtures that form part of the realty. Forbes v. Alabama Machinery &amp; Supply Co., 176 Ala. 423, 58 So. 398 (Ala. 1912).

LABOR AND MATERIALMEN'S CLAIMS

The current ALTA Lender's Form is customarily used.

FORM USUALLY REQUIRED BY LENDER

Endorsements to title insurance policies issued in Alabama are typically available from Alabama title insurers. More than 30 different types of endorsements are available to the lender, rendering the type, location, use, charter, and features of a property the determinant factors in requiring specific endorsements. Lenders frequently require insurance against covenants, conditions, and restrictions under which the lien of the mortgage could be cut off, subordinated, or otherwise impaired. Other required endorsements are dictated by the character of the specific property; however, zoning (insures applicable zoning), mineral and mining rights, encroachment as reflected on survey, foundation and improvement and location endorsements are commonly required. Endorsements for general, limited, or specific mechanic's lien coverage and flood plain (requiring flood insurance) are available.

ENDORSEMENTS AVAILABLE

A title insurance policy on real estate in Alabama must be issued by a person or agent who is domiciled in or is otherwise a bona fide resident of and resides in the state or is a partnership, association, corporation, or other legal entity properly organized or existing under the laws of Alabama and has issued to him or it a certificate of authority from the commissioner of insurance. Ala. Code &sect;&nbsp;27-25-4 & 4.1. Premium rates charged by title insurance companies are subject to approval by the commissioner of insurance. Ala. Code &sect;&nbsp;27-25-6. In any transaction involving the purchase or sale of a fee simple or possessory interest in Alabama real property, the title insurer or its agent must obtain at or before closing of settlement and disbursement of any funds a written statement that the purchaser has received a notice that owner's title insurance may be available and whether or not the purchaser desires to purchase owner's coverage. Ala. Code &sect;&nbsp;27-25-7(a). Such notification is not required in connection with a judicial or nonjudicial foreclosure and other specific transactions exempted by statute. Ala. Code &sect;&nbsp;27-25-7(c).

Alabama

Mortgage Law Summary

Continue reading the
Mortgage Law Summary for Alabama

Alabama

Mortgage Law Summary

Continue reading theMortgage Law Summary for Alabama

Continue reading the
Mortgage Law Summary for Alabama