Foreclosure & Alternatives Law
Foreclosure Laws in Alaska
The process of foreclosure will vary on a state-to-state basis, but Alaska homeowners who are worried about losing their homes can get a leg up by learning about the state’s foreclosure laws and procedures. Some of the ways foreclosure may vary according to the state include the way notices are handled, the redemption periods and how the foreclosure process is scheduled. Despite the differences, Alaska homeowners can develop a basic understanding of what foreclosure entails and what to expect during the process.
Across the nation, most mortgage companies begin a foreclosure process approximately three to six months following the initial missed mortgage payment. Even though many mortgage lenders understand that an Alaska homeowner may be experiencing a short-term financial crisis, the company will probably begin charging late fees within 10 to 15 days following a missed payment. This is why it is important to initiate contact and remain in contact with the lender after missing a payment. Ongoing communication may help homeowners delay or even avoid foreclosure in Alaska. Thirty days after missing a payment, the borrower will be in default and the process of foreclosure will begin to escalate. If the borrower does not contacted the lender, foreclosure proceedings will likely begin earlier.
The general information above informs Alaska homeowners of the approximate time they have to take action and find solutions to avoid foreclosure. The sections below tell these homeowners specific information about how foreclosure works in the state of Alaska.
Types of Foreclosures in Alaska
Judicial Foreclosure: A judicial foreclosure means the lender must file a lawsuit in order to obtain the court order necessary to foreclose. Judicial foreclosures have increased since the latter portion of the 1980s, due to mortgage lenders realizing much of the residential property foreclosed on was worth less than the amount of mortgage owed. Once the courts declare a judicial foreclosure, the property is auctioned off, allowing lenders to recover as much money as possible as recompense for the loan. In a judicial foreclosure, the borrower does not have any redemption rights but deficiency suits are allowed.
Non-Judicial Foreclosure: This type of foreclosure occurs when a deed of trust or a mortgage contains a power of sale clause. With such a clause the borrower essentially pre-authorizes the lender to sell the property for the purpose of paying off the mortgage loan balance should default occur. When a power of sale clause exists, either the lender or a representative may execute the sale.
Alaska Guidelines for a Power of Sale Clause
The following outlines the process for a non-judicial foreclosure through a power of sale clause.
- Lender or trustee must file a notice of default no less than 30 days following default and no less than three months before sale.
- Notice of default must contain borrower name, property description, amount owed, and lender’s wish to sell among other details about the mortgage.
- Within 10 days of filing the notice, the lender must mail a copy to the borrower’s last known residence.
- At any time before the property sells, the borrower may stop the sale by paying all missed payments as well as attorney fees.
- If the property has been in default more than once, Alaska statutes permit the lender to refuse payment and continue with foreclosure.
How Else Can Borrowers Prevent Alaska Foreclosure?
The law does provide several methods for Alaska homeowners to use in saving their residences. However, the best way to determine what works for a specific situation is by contacting an attorney to discuss the pertinent details.