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Free Guide to Hiring a Real Estate Lawyer
Foreclosure is the legal process a lender uses to recover the balance owed on a mortgage or deed of trust when a borrower defaults. In Denver, as in the rest of Colorado, many foreclosures are handled through a non-judicial process that uses the power-of-sale clause in a deed of trust. That process allows a trustee or the county public trustee to conduct a sale without first going to court, provided the lender follows statutory notice and procedural requirements. Foreclosure can have serious consequences for homeowners - including loss of the property, damage to credit, and potential deficiency actions - so understanding local procedures and protections is important for anyone facing possible foreclosure.
There are several common situations where hiring an attorney experienced in foreclosure law can make a significant difference:
- You received a Notice of Election and Demand, Notice of Default, or papers indicating a foreclosure sale is scheduled. A lawyer can review the documents, check for procedural defects, and explain timelines and options.
- You believe the lender or servicer made errors - for example, incorrect accounting of payments, failure to follow required notices, or wrongful assignment of the loan. An attorney can investigate and, if appropriate, raise defenses.
- You want to explore loss-mitigation options such as loan modification, short sale, deed-in-lieu of foreclosure, or reinstatement and need help negotiating terms and reviewing agreements.
- You face potential deficiency claims after a sale, or the lender has filed a separate deficiency lawsuit. Legal counsel can assess exposure and defend or negotiate.
- Your home is subject to additional liens - such as homeowner association claims or tax liens - that complicate foreclosure. Each lien type can change priorities and options, and a lawyer can clarify consequences.
- You are considering bankruptcy as a way to stop or delay foreclosure and need guidance on timing and effects of filing.
- You need representation at a hearing, mediation, or at a foreclosure-sale auction to protect your interests.
Key aspects of foreclosure law and practice in Denver and Colorado that are important to understand include:
- Non-judicial foreclosure is common - Colorado law permits foreclosures under a deed of trust using a power-of-sale provision. This lets a trustee or public trustee schedule a sale without a court order if statutory requirements are met.
- Statutory notice and procedural requirements - Lenders and trustees must follow state statutes that require recording and serving specific notices and publishing sale notices. These steps create timelines and provide borrowers defined opportunities to respond or reinstate.
- The county public trustee plays an active role - Each Colorado county has a public trustee who administers many foreclosures and conducts public trustee sales. In Denver County, the public trustee is the office that publishes sale notices and runs certain sales unless an alternate trustee provision is used.
- Reinstatement and cure rights - Colorado law recognizes the right of a borrower to reinstate the loan or cure the default by paying owed amounts before the foreclosure sale - subject to statutory and contract terms. Exact rights and deadlines depend on the loan documents and recorded notices.
- Redemption and deficiency rules vary - Post-sale redemption rights are limited in many non-judicial foreclosures. Deficiency judgments may be available to lenders in certain circumstances - whether a lender can obtain a money judgment for the remaining balance after a sale depends on statutory rules, the type of lien, and how the sale was conducted.
- Additional local rules can affect HOA and tax foreclosures - Homeowner association liens and property tax liens follow different procedures and can have priority over the mortgage or deed of trust in some cases. The timelines and legal consequences differ from mortgage-related foreclosures.
- Consumer protection and federal servicing rules apply - Mortgage servicing rules and federal protections may provide disclosures and loss-mitigation rights. These federal requirements work alongside Colorado statutes and local practices.
Because specific documents, loan terms, and recorded instruments change legal rights, a local attorney or housing counselor can explain how state law applies to a particular situation.
The first formal step is usually the lender recording a notice required by Colorado law - often called a notice of election and demand or a similar document - and sending required notices to the borrower. That step starts the statutory timeline that leads toward a foreclosure sale if the default is not cured or otherwise resolved.
There is no single timetable that fits every case. The process depends on the loan documents, the type of foreclosure, whether notices are properly issued, and whether the borrower seeks to cure the default or files bankruptcy. State statutes set minimum notice periods and steps that must be followed before a sale, but the best way to find a likely schedule for a specific file is to consult the recorded notices and an experienced attorney.
In many cases it is possible to stop or delay a foreclosure before the sale occurs. Common options include reinstating the mortgage by paying arrears, negotiating a loan modification, filing for bankruptcy, or arranging a short sale or deed-in-lieu of foreclosure. The available remedies depend on the timing, whether the borrower has funds to cure the default, and the lender's willingness to negotiate. Acting promptly is crucial.
Reinstatement means paying the amounts necessary to bring the loan current, including missed payments, late fees, and allowable costs, to stop the foreclosure and continue under the original loan. Colorado law and the loan contract define whether and how reinstatement is allowed. Typically reinstatement must occur prior to the foreclosure sale and while statutory notice periods remain in effect.
Possibly. If the sale proceeds do not fully cover the loan balance, the lender in some situations may seek a deficiency judgment for the unpaid remaining amount. Whether a deficiency is permitted depends on the type of mortgage or deed of trust, how the sale was conducted, and state law. Speak with an attorney to understand deficiency exposure in your case.
When the sale occurs, the property is offered at a public auction administered by the county public trustee or appointed trustee. The highest bidder becomes the purchaser and a trustee's deed is issued after confirmation of sale procedures. The borrower may receive notices and has limited time and remedies leading up to the sale. After the sale, the new owner may begin steps to take possession if the property is occupied.
Yes, many borrowers successfully negotiate with lenders or servicers directly for modifications, forbearance, or short sales. However, loan servicers can be complex to deal with, and written agreements should be reviewed carefully. An attorney or HUD-approved housing counselor can help review offers and ensure that agreed terms are documented and enforceable.
HOA liens and foreclosure processes are separate from mortgage foreclosures and can have different priority and timelines. An HOA lien may lead to a foreclosure that threatens a homeowner's title. If your property is subject to both a mortgage and an HOA lien, coordinate legal advice to understand priorities and options for resolving multiple claims.
Foreclosure significantly damages credit and can remain on a credit report for several years, making it harder to obtain new mortgage financing. Some renters and landlords also consider foreclosure history. That said, rebuilding credit is possible over time, and some borrowers can obtain new financing within a few years depending on the type of loan and circumstances.
There are several resources that provide free or reduced-cost legal help, housing counseling, and foreclosure prevention assistance. Local legal aid organizations and HUD-approved housing counseling agencies can provide guidance. The county public trustee's office can explain procedural aspects of scheduled sales. If you qualify, legal services programs may offer representation or advice at low or no cost.
Denver County Public Trustee - The office responsible for administering public trustee sales in Denver County. They publish schedules and provide information about upcoming sales and required notices.
Colorado Division of Real Estate - State agency that oversees real estate practices and can provide general information about real estate licensing and certain consumer protections.
Colorado Legal Services - A statewide network that may offer free civil legal assistance to eligible low-income residents on foreclosure and housing matters.
HUD-Approved Housing Counseling Agencies - Nonprofit counselors certified by the U.S. Department of Housing and Urban Development who can provide advice on loss mitigation, loan modification, and budgeting.
Colorado Bar Association - Can help you locate a qualified local attorney and often provides lawyer referral services.
Consumer Financial Protection Bureau and Federal Housing Agencies - Federal entities that publish consumer guidance on mortgage servicing, foreclosure prevention, and borrower rights under federal rules.
Local nonprofit housing organizations - Community-based organizations in Denver that offer foreclosure prevention programs, counseling, and sometimes emergency assistance.
If you are facing foreclosure or have received a notice, these practical next steps can help you protect rights and preserve options:
- Gather documents - Collect your mortgage note, deed of trust, recent mortgage statements, notices from the lender, correspondence, and proof of income and expenses. Having organized documents speeds up advice and negotiations.
- Contact your loan servicer - Call and ask for the department that handles loss mitigation. Ask what options are available, what documents they need, and any deadlines. Get the name and contact information of the person you speak with and follow up in writing.
- Seek housing counseling - Reach out to a HUD-approved housing counselor for free or low-cost guidance on options like loan modification, forbearance, or short sale alternatives.
- Consult an attorney - If you believe the lender made mistakes, if you need representation at a hearing, if you face multiple liens, or if you want help negotiating, consult a foreclosure attorney experienced in Denver and Colorado law.
- Respond to notices and meet deadlines - Do not ignore recorded notices or court papers. Missing deadlines can eliminate options like reinstatement or contesting the foreclosure.
- Consider alternatives - Explore sale of the property, deed-in-lieu of foreclosure, short sale, or bankruptcy if appropriate. Each option has legal and financial consequences that are best discussed with counsel.
- Prepare for the possibility of sale - If a sale is imminent and cannot be stopped, learn what will happen after the sale regarding possession, deficiency exposure, and credit impact, and plan next steps for housing and finances.
Facing foreclosure is stressful, but prompt action and informed choices can preserve options and improve outcomes. Consult a qualified Denver attorney or HUD-approved housing counselor to get advice tailored to your situation.
