HB529 Alabama 2026 Session

Summary

Primary Sponsor

Barbara DrummondRepresentative

Democrat

Session

2026 Regular Session

Title

Class 2 municipalities; municipal lien process revised

Summary

HB529 revises the Class 2 municipal lien foreclosure process in Alabama to speed up foreclosures, update forms, and cut certain notice requirements.

What This Bill Does

It lets Class 2 municipalities adopt their own forms for foreclosure petitions and deeds, and it removes some notice requirements to tax authorities. It shortens timelines: a foreclosure sale must occur 30 days after a court order (instead of 45), deeds must be executed within 30 days after the sale (instead of 90), and foreclosure reports must be filed within 30 days (instead of 90). It adds a six-month waiting period after a municipal lien is recorded before filing, requires 60 days’ notice to tax officials before filing, and updates notice, lis pendens, and publication procedures. It also updates other technical provisions and sets an effective date of October 1, 2026.

Who It Affects

• Class 2 municipalities in Alabama, by giving them authority to adopt their own forms, speeding up foreclosure timelines, and relaxing certain notification requirements.
• Property owners and other interested parties (including occupants) in Class 2 municipality foreclosures, who face revised timelines, new notice requirements, potential sale of property, and redemption options.

Key Provisions

• Applies only to Class 2 municipalities.
• Amends Sections 11-40-65, 11-40-67, and 11-40-68, Code of Alabama 1975, to revise the foreclosure process.
• Removes requirement to notify state and local taxing authorities (except the local ad valorem tax collector) of foreclosures; authorizes municipalities to adopt their own forms for petitions and deeds.
• Adds a six-month waiting period after a municipal code lien is recorded before filing a petition for judicial in rem foreclosure.
• Requires at least 60 days’ prior notice to the county’s ad valorem tax official and other taxing agencies; tax payoff amount provided to the municipality.
• Requires lis pendens notice, petition filing, and notice by mail, publication, and posting on the property.
• Owner-occupied properties are not subject to judicial in rem foreclosure; petition may be dismissed if owner-occupied is found.
• Redemption rights allow interested parties to redeem before sale; owner redemption ends proceedings, other party redemption creates a lien.
• Sale conducted by the court with minimum bid equal to the redemption amount; if no higher bid, the municipality may bid; sale proceeds distributed to parties per priority.
• Deed to be executed and recorded within 30 days after sale; the municipality files a sale report within 30 days.
• Effective date is October 1, 2026.

AI-generated summary using openai/gpt-5-nano-2025-08-07 on Mar 31, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Counties & Municipalities