Colorado - Real Estate Foreclosure Laws

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Real Estate Foreclosure Laws In Colorado | eHow.com Page 1 of 3 Print Article Real Estate Foreclosure Laws In Colorado By Lisa Dorward, eHow Contributor Colorado offers a special hotline for homeowners facing foreclosure. Foreclosure proceedings can be initiated by mortgage holders when the mortgage (or lien) goes into default, but there are strict procedures that must be followed. Colorado offers help to homeowners facing foreclosure through nonprofit housing counselors who facilitate communication between lenders and borrowers and provide information to borrowers regarding their options. Foreclosure Types Colorado law allows for both judicial and nonjudicial foreclosures. Judicial foreclosures involve filing a lawsuit to obtain a court order to foreclose. A nonjudicial foreclosure does not require the filing of a lawsuit. Colorado is one of 27 states that allows nonjudicial foreclosures when a "power of sale" clause is in the mortgage contract or deed of trust. This provision serves as a pre-authorization by the borrower for the home to be sold by the lender in case of default. Unlike many other states, Colorado's governor appoints a "Public Trustee" for each county in the state. These trustees conduct the foreclosure sale as an impartial party. Nonjudicial Process http://www.ehow.com/print/info_7912403_real-estate-foreclosure-laws-colorado.html 3/12/2011 Real Estate Foreclosure Laws In Colorado | eHow.com Page 2 of 3 In a nonjudicial foreclosure, the lender's attorney files the required documents with the Office of the Public Trustee in the county where the property is located. The Public Trustee then files a Notice of Election and Demand For Sale and publishes a notice in a local newspaper for a period of five consecutive weeks. Within 10 days of filing, the Public Trustee must mail a copy of the notice published in the newspaper and a copy of the recorded instrument to the homeowner. At least 21 days before the date of sale, the Public Trustee must also mail a notice to the homeowner describing how he can redeem the property. Even in a nonjudicial foreclosure, a "Rule 120 Hearing" must be held prior to the sale to determine if all procedures have been legally met. Judicial Process In a judicial foreclosure process in Colorado, the lender must file a "lis pendens" with the court along with lawsuit documents. A lis pendens is a document that gives notice that the property is being foreclosed upon. Intent to Cure The homeowner may file an Intent to Cure with the Office of the Public Trustee not less than 15 days prior to the date of sale of the property. The homeowner must then pay the amount needed to bring the loan current by noon of the day prior to the scheduled foreclosure sale date. Foreclosure Sale The foreclosure sale must take place between 45 and 60 days after the Notice of Election and Demand For Sale is recorded. Foreclosure sales take place at the county courthouse in the county where the property is located unless other provisions have been made in the deed of trust. Right of Redemption A right of redemption is the right of the foreclosed homeowner to buy back the property after the foreclosure auction has taken place and prior to the expiration of the redemption period. Although Colorado http://www.ehow.com/print/info_7912403_real-estate-foreclosure-laws-colorado.html 3/12/2011 Real Estate Foreclosure Laws In Colorado | eHow.com Page 3 of 3 used to allow a period of redemption after a foreclosure sale, it no longer does. Resources • Colorado Department of Local Affairs Division of Housing: Colorado Foreclosure Hotline http://www.ehow.com/print/info_7912403_real-estate-foreclosure-laws-colorado.html 3/12/2011