PLEASE NOTE: Colorado’s foreclosure laws may change from time to time by legislation adopted by the Colorado General Assembly and signed by the Governor. Please refer to Colorado Revised Statutes, Title 38, Article 37 and 38 for the most recent laws and their effective dates. Foreclosure laws have changed several times over the last few years.
Every foreclosure case can go through many phases or legal steps during its processing from beginning to end. That’s what the “status” line is for and it generally shows which phase or step a foreclosure case is in at the current time. You must take into consideration that the Public Trustee’s office is currently processing foreclosure cases under different sets of laws, deadlines and requirements. The following is a general description of what each “status” means:
Bankruptcy - When a borrower files a Bankruptcy Petition prior to or during publication of the notice of foreclosure, the U.S. Bankruptcy Court will usually issue a stay order requiring that the foreclosure action not be continued until further notice from the court. The foreclosure sale extends week to week until the Bankruptcy Court takes action. If the Bankruptcy Court subsequently issues an order granting relief from the stay order, then the foreclosure may be restarted.
Bid/Amended Bid - An initial written bid is due from the foreclosing lender/holder by noon (12:00 pm Mountain Time) two business days prior to the scheduled foreclosure sale date. A bid usually includes the outstanding principal amount, interest due, and statutorily-allowable fees and costs from the attorney and Public Trustee. Bids submitted on time may be amended by noon (12:00 pm Mountain Time), the day before the sale. If an initial written bid from the lender is not received timely for a foreclosure set to go to sale, the foreclosure sale is continued for at least one week.
Certificate of Purchase (COP) - The Public Trustee issues this document to the successful bidder at the Foreclosure Sale to show that the successful bidder has an interest in the property. It is recorded with the Clerk & Recorder’s office and made public record, but it does NOT transfer title or ownership of the property to the holder of the Certificate of Purchase. It may also be used as a lien if there is another foreclosure running at or about the same time period on the same property. The Certificate of Purchase is assignable to someone else at the option of the holder prior to title vesting.
Confirmation Deed/Deed Issued/Deeded - Once all redemption periods have expired and no redemption has been made (or a redemption has been made and a Certificate of Redemption has been issued and recorded), the Public Trustee may issue a Public Trustee’s Deed or Confirmation Deed to the holder of the Certificate of Purchase or the holder of the last-issued Certificate of Redemption. The Deed is then recorded with the Clerk & Recorder’s office and transfers title to the property from the previous owners (borrowers) to the new owner.
Continuance - The scheduled sale date may be continued (postponed) at the request of the lender or its attorney, or it may be continued by the Public Trustee, for legally defined reasons up to one year past the original sale date. Continuances cannot be made after that 12-month period has expired and the foreclosure may, at that time, be subject to withdrawal. The Public Trustee is NOT legally authorized to continue a sale date simply because the borrower/landowner has requested a continuance.
Cure/Intent to Cure - A cure may be made prior to the foreclosure sale only by certain people/entities who have a legal right to cure the default on the mortgage or Deed of Trust. If a property owner (or other legally-entitled person) believes they can bring the past-due payments current (plus all fees and costs of the lender, lender's attorney, and Public Trustee), they must file with the Public Trustee's office a Notice of Intent to Cure at least 15 days prior to the scheduled sale date. The Public Trustee's office then requests cure figures from the lender. Cure figures from the lender are due to the Public Trustee's office within 10 business days of the request or by the eighth (8th) calendar day before the sale. Once cure figures are received, the Public Trustee provides those to the party who filed the Intent to Cure. The cure amount given is effective through the deadline listed on the cure statement.
Current Lender/Beneficiary - It is a common practice for mortgage companies to "sell" loans to other lenders or pools of lenders. The current lender (or beneficiary) of a loan will frequently not be the mortgage company that made the loan when the property was initially purchased.
Deed of Trust - In Colorado, a mortgage is generally called a Deed of Trust and that document is signed and recorded at the time the property is purchased and financed. The Deed of Trust gives the Public Trustee the right to sell the property through foreclosure proceedings if the borrower defaults on the terms of the Deed of Trust or Promissory Note (non-payment or other default).
Deficiency - Foreclosing lenders must submit bids that they believe reflect the property's value at the time of the foreclosure sale. If the lender feels the property is worth less than the amount owed on it, the "deficiency amount" reflects the difference. If the property is sold for less than the amount owed on the loan at the time of sale (plus all costs and fees), the lender may attempt to collect the deficiency amount personally against the borrower through a separate court action because the deficiency amount is NOT extinguished by the foreclosure.
Junior Lienor - There may be more than one deed of trust or other lien on a property. Anyone who holds a lien on a property is called a lienor and may have a right to redemption of the property according to law. Lienors need to have a recorded interest in the property being foreclosed prior to the NED recording date. In order to redeem the property in foreclosure, a lienor must file a Notice of Intent to Redeem within eight (8) business days of the sale. Lienors interested in exercising their legal rights on a foreclosure property are strongly advised to consult with an attorney.
Mailings - By law, the Public Trustee must mail notices and information to persons/entities specified on the mailing lists provided to the Public Trustee by the lender or its attorney. This notice sets out the time and date of the foreclosure sale. There are at least two mailings sent out to the mailing lists provided.
Notice of Election and Demand (NED) - The notice of Election & Demand for Foreclosure (NED) is the first document the Public Trustee’s office receives from the lender or its attorney. This is recorded with the Clerk & Recorder’s office, and the foreclosure is officially started at this time.
Order Authorizing Sale (OAS)/Rule 120 Court Action - When a loan is referred to an attorney for a foreclosure action, the attorney files a court action under Rule 120 of the Colorado Rules of Civil Procedure. The borrowers/owners are notified of the date and time for the court hearing and may attend that hearing. The purpose of the hearing is to provide the lender's attorney an opportunity to prove to the judge that a "reasonable probability” exists that the loan is in default. If the borrower/owner does NOT appear at the court hearing, the court will consider from the evidence presented whether there is a reasonable probability that a default exists and then, if so, will enter an Order Authorizing Sale to permit the foreclosure action to proceed. Before the Public Trustee's office may sell a property on the foreclosure sale date, it must have received from the lender's attorney a signed copy of the Order Authorizing Sale. Any foreclosure sale made without that Order is invalid.
Overbid - If a property goes to foreclosure auction sale and is purchased for more than the total owed to the lender (amount of lender’s bid plus any deficiency equals the total owed to lender) and amounts owed to all other lien holders, the owner of the property at the time of the NED filing should contact the Public Trustee’s office after the sale has occurred because such owner may have funds due to him/her.
Publications - By law, the Public Trustee must publish the mailed notice in a newspaper of general circulation within Weld County. We currently publish in the Greeley Tribune. The notice must be published at least 5 consecutive weeks.
Recission - Means the foreclosing lender (who was the successful bidder at the Foreclosure Sale and is the holder of the Certificate of Purchase) has filed with the Public Trustee no later than 8 business days after the Foreclosure Sale a Notice of Rescission of Sale. Once a sale has been rescinded, it is essentially set aside and voided as if the sale had never taken place. The foreclosure action may be re-set for a new Sale Date or withdrawn if requested by the lender or its attorney.
Redemption - Means that a lienor (or other qualified person/entity with a recorded interest in the property PRIOR to the NED recording date), other than the foreclosing lender, has timely redeemed the property after the Foreclosure Sale has been held. A redemption requires that all funds owing to the foreclosing lender or holder of the Certificate of Purchase (COP), including attorney's fees and costs and Public Trustee's fees and costs, be paid in full. If a property is redeemed before the deadline expires, a Certificate of Redemption (COR) will be issued. Once the COR has been issued by the Public Trustee, it is assignable to someone else at the option of the holder. Ultimately, the last COR issued will obtain ownership of the property through a Public Trustee's Confirmation Deed.
Restart - When a borrower files a Bankruptcy Petition prior to or during publication of the notice of foreclosure, the U.S. Bankruptcy Court will usually issue a “stay order” requiring that the foreclosure action not be continued until further notice from the court. If the Bankruptcy Court subsequently issues an order granting “relief” from the stay order, then the foreclosure may be restarted. If the foreclosure is restarted, the Public Trustee’s office must follow the court’s order to re-record the NED, re-publish the Notice in the newspaper and reset a new Foreclosure Sale Date.
Scheduled Sale Date - A sale date is established somewhere between 110 and 125 days for non-agriculture properties, and between 215 and 230 days for agriculture properties after the NED is recorded to allow time for legal notice mailings and for newspaper publications to be completed. The original sale date may be continued upon request of the lender or its attorney, or it may be continued by the Public Trustee only under legally-defined circumstances.
Set Aside Court Order - There are many legal reasons why a sale may have to be set aside by Court Order, and this means that a motion has been or is being filed to set aside the sale on the property or that a court order has already been entered setting aside a sale previously held. The foreclosure case may be restarted, and the sale may be continued to a new date once the Order of Court is signed or there could be other court-ordered requirements if the foreclosing lender wishes to proceed with the foreclosure thereafter.
Temporary Restraining Order (TRO) – This means that a court with jurisdiction has issued an order temporarily restraining anyone from proceeding with the foreclosure action.
Third Party Bidder - If someone other than the foreclosing lender (usually referred to as a "third party bidder") bids more than the initial written bid submitted by the foreclosing lender, that is an overbid. The successful third party bidder must submit certified funds by 2:00 pm (Mountain Time) the day of the sale via wire or cashier’s check.
Withdrawn/To be Withdrawn - A foreclosure may be withdrawn (stopped) for several reasons at the request of the lender or its attorney, or by the Public Trustee if the sale has been continued for too long a period of time and not held within 12 months from the originally-scheduled Sale Date. When a foreclosure is cured that will also withdraw the file. Once a foreclosure is withdrawn, if the default remains or occurs again, a new foreclosure action may be started by the lender.