Is it Possible to Redeem Commercial Property in a Foreclosure in Alabama?
Full Question:
Answer:
It is possible to redeem vacant property in Alabama securing a commercial loan by tendering the sale price, plus interest and other charges.
For further discussion, please see:
http://www.sasserlawfirm.com/index.php?option=com_content&task=view&id=34&Itemid=47
Please see the following AL statutes:
§ 6-5-248. Who may redeem; priorities.
(a) Where real estate, or any interest therein, is sold the
same may be redeemed by:
(1) Any debtor, including any surety or guarantor.
(2) Any mortgagor, even if such mortgagor is not personally
liable for payment of a debt.
(3) Any junior mortgagee, or its transferee.
(4) Judgment creditor, or its transferee.
(5) Any transferee of the interests of the debtor or
mortgagor, either before or after the sale. A transfer of any
kind made by the debtor or mortgagor will accomplish a
transfer of the interests of that party.
(6) The respective spouses of all debtors, mortgagors, or
transferees of any interest of the debtor or mortgagor, who
are spouses on the day of the execution, judgment, or
foreclosure sale.
(7) Children, heirs, or devisees of any debtor or
mortgagor.
(b) All persons named or enumerated in subdivisions (a)(1)
through (a)(7) may exercise the right of redemption granted by
this article within one year from the date of the sale.
(c) When any judgment creditor or junior mortgagee or any
transferee of a judgment creditor or a junior mortgagee redeems
under this article, all recorded judgments, recorded mortgages
and recorded liens having a higher recorded priority in
existence at the time of the sale are revived against the real
estate redeemed and against the redeeming party and such shall
become lawful charges pursuant to Section 6-5-253(a)(4) to be
paid off at redemption.
Once any lienholder, recorded judgment creditor, or junior
mortgagee is paid the amount of such person's debt and any
accrued interest and other contractual charges, such person has
no further right to redeem.
Any lienholder, recorded judgment creditor, or junior
mortgagee with a lower recorded priority may redeem from those
having a higher recorded priority who have redeemed.
(d) When any debtor, mortgagor, their transferees, their
respective spouses, children, heirs, or devisees redeem, all
recorded judgments, recorded mortgages, and recorded liens in
existence at the time of the sale, are revived against the real
estate redeemed and against the redeeming party and further
redemption by some party other than the mortgagor or debtor
under this article is precluded.
(e) When any debtor or mortgagor conveys his interest in
property subject to a mortgage prior to sale wherein they are
released from liability for the debt, his right of redemption
under this article is terminated. In the same manner, the right
of redemption granted under this article to the spouses,
children, heirs, or devisees of debtors or mortgagors
terminates when the debtors or mortgagors have conveyed their
interests in the property and are released from liability for
the debt.
However, where debtors or mortgagors have conveyed their
interests in the property but remain liable on the debt and are
debtors at the date of the foreclosure sale, the debtors and
mortgagors retain their right of redemption under this
article and in the same manner, their spouses, children, heirs or
devisees continue to be entitled to the right of redemption
under this article.
(f) A redemption made by any person under this article, other
than the debtors or mortgagors, and their respective spouses,
children, heirs, or devisees, shall preclude any further
redemption by such person.
(g) Subject to subsection (e), a mortgagor and debtor have
priority over any other redeeming party and a mortgagor has
priority over a debtor.
§ 6-5-252. Demand for statement of debt and lawful charges by person
entitled to redeem.
Anyone desiring and entitled to redeem may make written
demand of the purchaser or his or her transferees for a
statement in writing of the debt and all lawful charges claimed
by him or her, and such purchaser or their transferees shall,
within 10 days after such written demand, furnish such person
making the demand with a written, itemized statement of all
lawful charges claimed by him or her. The redeeming party must
then tender all lawful charges to the purchaser or his or her
transferee. If the purchaser or his or her transferee fails to
furnish a written, itemized statement of all lawful charges
within 10 days after demand, he or she shall forfeit all claims
or right to compensation for improvements, and the party so
entitled to redeem may, on the expiration of the 10 days, file
his or her complaint without a tender to enforce his or her
rights under this article and file a lis pendens with the
probate court.
Tender or suit must be made or filed within one year from
foreclosure.
§ 6-5-253. Payment or tender of purchase money and other lawful charges,
with interest.
(a) Anyone entitled and desiring to redeem real estate under
the provisions of this article must also pay or tender to the
purchaser or his or her transferee the purchase price paid at
the sale, with interest at the rate allowed to be charged on
money judgments as set forth in Section 8-8-10 (as it is now or
hereinafter may be amended), and all other lawful charges, also
with interest as aforesaid; lawful charges are the following:
(1) Permanent improvements as prescribed herein.
(2) Taxes paid or assessed.
(3) All insurance premiums paid or owed by the purchaser.
(4) Any other valid lien or encumbrance paid or owned by
such purchaser or his or her transferee or if the redeeming
party is a judgment creditor or junior mortgagee or any
transferee thereof, then all recorded judgments, recorded
mortgages and recorded liens having a higher priority in
existence at the time of sale which are revived under
Section 6-5-248(c).
If the redemption is made from a person who at the time of
redemption owned the debt for which the property was sold,
the redemptioner must also pay any balance due on the debt,
with interest as aforesaid thereon to date.
(5) Mortgagees of the purchaser, or their transferees, are
considered transferees of the purchaser, and a party
redeeming must pay all mortgages made by the purchaser or his
or her transferee on the land to the extent of the purchase
price.
If the purchaser's mortgages do not exceed the amount of
the purchase price, the balance must be paid to the
purchaser.
(b) If the redeeming party is the debtor, mortgagor, their
respective spouses, children, heirs, or devisees then, unless
otherwise provided herein, the judgments, mortgages, and liens
revived pursuant to 6-5-248(d) are not lawful charges as
defined in subsection (a).
(c) The purchaser shall be entitled to all rents paid or
accrued including oil and gas or mineral agreement rentals to
the date of the redemption, and the rents must be prorated to
such date. The purchaser or his or her transferee and his or
her tenants shall have the right to harvest and gather the
crops grown by them on the place for the year in which the
redemption is made, but must pay a reasonable rent for the
lands for the proportion of the current year to which such
redemptioner may be entitled.
(d) Any one entitled and desiring to redeem shall be granted
a credit as against the amount of money required to be paid for
redemption as follows:
(1) For all timber cut or sold on the land by the purchaser
or his or her transferees, during the statutory period of
redemption.
(2) For any oil and gas, minerals (including coal bed gas),
sand, and gravel, taken from the land or sold, and for advanced
royalties or bonuses received by the purchaser or his or her
transferees, during the statutory period of redemption.
(3) To the extent the value of the property is diminished
when any structures or buildings are changed, removed,
demolished, or destroyed by the purchaser or his or her
transferees during the statutory period of redemption.
§ 6-5-247. Definitions.
Unless the context otherwise requires, the words defined in
this section shall have the following meanings when found in
this article:
(1) SALE or SOLD. Any execution, judgment, or foreclosure
sale, whether the sale is made under any power of sale in any
mortgage or deed of trust or statutory power of sale, or by
virtue of any judgment in any court of competent
jurisdiction.
(2) MORTGAGE. Any mortgage, deed of trust, or any other
instrument intended to secure the payment of money, such as
an instrument which includes a vendor's lien.
(3) JUNIOR MORTGAGE. Any mortgage, deed of trust, or any
other instrument intended to secure the payment of money by
the transfer of an interest in real property, such as a
conveyance which includes a vendor's lien, which are lower in
priority than the foreclosed mortgage or lien.
