Colorado Foreclosure Law
Colorado foreclosures occur through both in-court and
out-of-court proceedings. The most common process is managed by
a public trustee out of court and takes about six months.
Pre-foreclosure Period
The public trustee for each county is either appointed by the
governor or elected by the public. The out-of-court foreclosure
process begins when a lender files the appropriate documents
with the public trustee to request a sale of the property. Once
the public trustee officially records the foreclosure action, a
foreclosure sale can be scheduled. After the sale is scheduled,
the lender still has to obtain a separate court order allowing
the sale. The court schedules a hearing to consider the matter,
and all affected parties are notified. If no one contests that
the borrower is in default, the court allows the sale without a
hearing. If the borrower plans to pay off the default and stop
the foreclosure, he or she needs to submit the intention to do
this to the public trustee at least 15 days before the sale. If
this is done, the borrower can pay off the default and
discontinue the foreclosure process up until noon the day before
the sale.
Notice of Sale / Auction
The public trustee schedules the sale 45-60 days after the
initial foreclosure action was recorded. The notice of sale is
published in a local newspaper for five weeks. The public
trustee also mails a copy of the notice to the borrower. The
public trustee typically conducts the sale at the courthouse. At
the sale, the public trustee reads the written bid submitted by
the lender, and any party may bid. If anyone other than the
lender is the winning bidder, that person must deliver the bid
amount in cash or cashier's check to the public trustee. The
winning bidder is given a certificate of purchase. After the
sale, the borrower usually has 75 days to redeem the property by
paying the total winning bid plus interest and costs. If the
borrower does not redeem, junior lien holders may do so. If no
one redeems, the public trustee transfers ownership to the
winning bidder.
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