2022 Colorado Foreclosure Timeline

A single unexpected expense and a missed mortgage payment can set off a string of events that snowball into a complicated problem. When you miss a payment, you have a short grace period, usually 10-15 days, during which you can pay without penalty. After that, a late fee will be assessed by the lender, which is often 5% of the amount overdue. It doesn’t take long for that one unaffordable mortgage payment to become even more out of reach, putting foreclosure proceedings into action.

Foreclosure involves many complex steps according to a timeline specified by Colorado law. When there is an opportunity for you to do something to avoid a Colorado foreclosure, do it as soon as possible and follow the instructions you are given to the letter. Even small errors can potentially derail you from keeping your home. Let’s take a look at how the foreclosure process unfolds and how you can respond at each step

This timeline is a simplified summary of the basic procedures under the foreclosure statute and does not attempt to cover all aspects. This is a complex statute and an attorney should be consulted before taking any steps, or making any decisions, regarding the foreclosure process.
Note that, unless otherwise stated, all references to “days” are “calendar days”. When calculating dates, if the specified date is a legal holiday, or a Saturday or Sunday, then the date is extended to next day that is not a legal holiday, Saturday or Sunday.
Pre-foreclosure

• Watch for FHA, HUD and VA loans for additional rules for when foreclosure can be commenced. For example, under HUD rules, foreclosure can be commenced only if at least 3 fully monthly installments are due and unpaid, subject to exceptions.
• At least 30 days before filing notice of election and demand and at least 30 days after default, the lender is required to mail a notice to the borrower containing the telephone numbers of the Colorado foreclosure hot line and the direct telephone number of the lender’s loss mitigation department.

Lender’s procedures on commencement of the foreclosure saleThe lender’s attorney will commence the sale by filing the following with the public trustee of the county where the property is:

• Original Notice of Election and Demand for Sale (NED).
• Original evidence of debt, and any endorsements or assignments. If the evidence of debt is mislaid, a lost instrument bond must be submitted, unless the lender is a financial institution that can provide an indemnity.
• Original recorded Deed of Trust, and any original modifications, or any partial releases, or certified copies of these documents.
• The combined notice for mailing to the persons on the mailing list.
• A deposit on the fees of the public trustee.
• Mailing list containing the names and addresses of owners, guarantors, lessees and occupants, (as shown by the public records or records of the lender), who will receive notice of the sale.
• An amended mailing list may be filed, not less than 60 days prior to the first scheduled sale date. If the amended mailing list is received by the public trustee after the mailing has been sent out, the sale will be continued for no less than 65 days after receipt of the amended mailing list. The public trustee shall send the mailing list no less than 45 days prior the actual date of sale.

Public trustee procedures on commencement of the foreclosure saleOn receipt of the request for sale, the public trustee must:

• Record the NED – no later than 10 business days after receipt of the request for sale.
• No more than 60 days and no less than 45 days prior to the first scheduled date of sale, advertise the sale in a newspaper once a week for five successive weeks (unless the deed of trust requires a longer period), only after the affidavit of posting of the deferment notice has been received. Sale is continued until this affidavit is received.
• Mail copies of the combined notice to the specified parties no less than 16 days, nor more than 30 days, after the lender has delivered the mailing list. If there is an amended mailing list, then mail the combined notice no more than 60 days and no less than 45 days prior to the first scheduled date of sale.
• Scheduled the sale of date that is not less than 110 days and not more than 125 days after the recording of the NED for non-agricultural property. For agricultural property, the date of sale must be scheduled no less than 215 days and no more than 230 days after the recording of the NED.

Note that unless otherwise stated, all references to “days” are “calendar days”. When calculating dates if the specified date is a legal holiday, or a Saturday or Sunday, then the date is extended to next day that is not a legal holiday, Saturday or Sunday.
Right to Cure:

• The borrower must give at least 15 days notice, prior to the sale, of the intention to cure.
• The public trustee must deliver a request for a statement of all sums to cure, to the lender at least 12 days prior to the sale- if not the sale is postponed for 2 weeks.
• The public trustee must receive the cure amount form the borrower by noon on the day before sale.
• The statement must be valid for at least 10 days after the date the statement is received by the public trustee, or until the last day to cure, whichever occurs first, but in any event no more than 30 days from the date of the last day to cure.
• Failure to provide the statement by the earlier of 10 business days after receipt of the request to cure, or 8 days prior to the date of sale:
  • Sale automatically postponed for 1 week and thereafter week to week until cure statement provided (but not continuance beyond 12 months from original date of sale).
  • Interest at the regular rate and not default rate during this period

Default cured:

• If the default has cured, then:
  • A formal withdrawal must be filed with the public trustee if the NED has been recorded.
  • All costs to date must be paid, including the fees of the public trustee, together with the withdrawal fee.
  • If a Rule 120 proceeding has commenced, this proceeding must be withdrawn, or the order vacated (if the order has been granted).
• If foreclosing party fails to withdraw the sale, the public trustee can withdraw the sale 45 days after the last possible date of sale, which is 12 months from the originally designated date of sale.

Rule 120 Hearing (Colorado Rules of Civil Procedure Rule 120):

• The notice of the Rule 120 proceeding must be served on the borrower, record owner of the property, and all other person who may have an interest in the property at least 14 days prior to the date set for the hearing.
• The hearing must be scheduled at least 16 days prior to the sale.
• The order must be received by the public trustee by noon on the second business day prior to the date of the sale. If the order is not received in time, the sale will be automatically postponed.
• The public trustee will not go to sale without this order, and a sale held without this order is invalid.

Sale of Property by the Public Trustee:

• The lender must submit its bid not later than 12 noon on the second business day prior to the date of sale. If this deadline is missed, the sale is continued for 1 week.
• The public trustee will auction the property at the time and place stated in the notice of sale, but no less than 16 days after the date of the scheduled Rule 120 hearing.
• On completion of the sale, the public trustee will issue a certificate of purchase to the successful bidder, and record copy within 5 business days of the sale.

Rescission of the Sale:

• The sale can be rescinded without a court order, if the holder of the certificate of purchase is the foreclosing party.
  Rescission must be requested within 8 business days after the sale.
• If the sale has been rescinded, the Lender can commence a new foreclosure sale scheduled not less than 30 days and not more than 45 days after the request for a new sale.

Redemption for junior lienors:

• All lienors must file notice of intention to redeem with the public trustee within 8 business days after the sale, with copies of the instruments evidencing the lien and a statement of the amounts required to redeem this lien.
• The public trustee, within 1 business day of receipt of the notice of intention to redeem, shall request the amount to redeem from the holder of the certificate of purchase.
• The lienor having the most senior party may redeem no earlier than 15 business days and not later than 19 business days after the date of sale.
• Thereafter, the lienors holding the next junior lien may redeem within 5 business days from the expiry of the previous lienor’s redemption period.
• The redemption period must be paid to the public trustee no later than 12 noon on the last day of the redemption period.
• The certificate of redemption must be recorded no earlier than 15 business days following the sale, but no later than 5 business days following the receipt of the redemption amount.
• Special redemption periods apply for liens filed by (1)The Internal Revenue Service (redemption period is 120 days from date of sale), (2) the federal government (redemption period is 1 year from the date of sale).
• No redemption period is shortened or altered by the fact that a prior lien redeemed prior to the end of that lienor’s redemption period.

Vesting of title:

• Title automatically vests at the end of all redemption periods in the holder of the last certificate of redemption.

Confirmation Deed:

• The public trustee must execute and issue a public trustee’s deed no earlier than 10 business days after both the vesting of title and the date that the public trustee has received all fees and costs.