10. Here in Colorado, a lender may foreclose on a mortgage in default by using either a judicial or non-judicial foreclosure process.
9. In the judicial process of foreclosure, a mortgage or deed of trust does not contain a power of sale clause, so a lawsuit is filed to obtain a court order to foreclosure on a property. Once the courts have declared foreclosure, the home will be sold at auction.
8. In the non-judicial process of foreclosure, a mortgage or deed of trust contains the power of sale clause. By signing the mortgage, a borrower pre-authorizes the sale of the property to pay off the loan balance in the event of default.
7. Each county in Colorado has a public trustee that acts as impartial witness to handling the power of sale foreclosure.
6. The attorney representing the lender is required to file documentation with the public trustees office in the county where the property is located. The public trustee files a notice of election and demand with the country clerk, and publishes the notice in a newspaper of general circulation within the county for 5 consecutive weeks.
5. The public trustee must also mail this notice to the owner/borrower within ten days of filing.
4. The public trustee must mail a notice to the borrower describing how to redeem the property at least 21 days before the foreclosure sale.
3. The owner has the right to stop the foreclosure proceedings by filing an intent to sure with the public trustee’s office at least 15 days before the foreclosure sale.
2. The foreclosure sale must take place between 45-60 days after the recording of the election and demand for sale.
1. The lender has the option to file a suit for deficiency, giving the borrower up to 75 days after the sale to redeem the property by paying the foreclosure amount plus interest.
