Colorado Laws

Most Colorado foreclosures are carried out through non-judicial proceedings, because of the presence of Power of Sale clauses in Colorado mortgages. Power of Sale clauses provide the lender with the right to pursue foreclosure and conduct a sale on their own in the event of a default. However, all Colorado foreclosures must be approved by a court before the process can begin, regardless of a Power of Sale clause.

The lender must first file the appropriate documents with the county's Public Trustee in order to register the default. The Public Trustee is either elected by the public or appointed by the governor to handle Colorado foreclosures. The Trustee reviews the lender's intention to foreclose, and then schedules a foreclosure sale of the homeowner's property for 45-60 days after the date the request was filed.

The lender must then file the Notice with the court in order to have them hold a hearing to decide whether or not to allow the foreclosure to proceed. The homeowner is entitled to contest the default at the hearing, but if the court rules against them, they will present the lender with an order allowing them to foreclose. The process of foreclosure is left up to the lender and the Public Trustee from this point on.

The homeowner can stop the foreclosure by announcing to the Public Trustee their intent to pay off the default debt at least 15 days before the sale is scheduled to occur. Once this is recorded, the homeowner has until the day of the sale to pay the full default amount plus any additional interest gathered.

Before the sale, the Public Trustee will issue a Notice of Sale and publish it weekly in a local newspaper for five weeks before the sale occurs. The homeowner in default is also entitled to receive a Notice of Default at least five weeks before the sale occurs.

At the foreclosure sale, the Public Trustee auctions off the homeowner's property to the highest bidder, who must then provide the full amount of their bid to the Public Trustee in the form of either cash or a cashier's check. The winning bidder is then issued a Certificate of Sale entitling them to full ownership pending the expiration of the original homeowner's redemption rights.

The homeowner may redeem ownership for up to 75 days after the sale ends by paying the amount of the winning bid plus any additional interest gathered.

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