HOW TO AVOID FORECLOSURE
Repayment plans. If you haven’t missed many payments, you can ask your loan holder to allow you to pay off the money bit by bit, adding a portion of the past-due amount to your regular payments.
Reinstatement. If you’re experiencing a temporary cash shortfall, your lender may offer you a fixed amount of time to pay off the past-due amount. But be aware that you’ll also be responsible for covering any late fees and penalties you’ve incurred.
Forbearance. If you lose your job or are otherwise unable to make your monthly payments, your lender may agree to reduce or suspend your payments for an agreed-upon period of time. Once your monthly payments kick back in, you will required to pay off the past-due amount, in pieces or in one lump sum.
Loan modification. If your income is permanently reduced, your lender may consider changing the terms of your mortgage by reducing your interest rate, lengthening the life of the loan or adding the past-due amount to your balance.
With monthly payments set to increase on 2 million mortgages over the next 18 months, things may get worse before they get better, warns Nick Jacobs of the nonprofit National Foundation for Credit Counseling. For more information on your options, visit www.housinghelpnow.org. The Web site provides help finding a local, low-cost, certified housing counselor for homeowners in danger of foreclosure.
Rent. Rent your property and move into a property that you can afford. Landlords can advertise your property FREE on http://www.ColoradoRentalProperty.Net whereby you can post a full detail ad, post 5 color photos and direct all inquires to either yourself or your property manager.
Sell. You need to move quickly. Do not expect to walk away with your equity in this situation. Place your home on the market, Hire an experienced Realtor. Place your home on the market with enough to cover your expenses. When your situation changes you can entertain homeownership again. Allow your property to foreclose and it will remain a distant memory for many years.
Colorado foreclosures occur through both in-court and out-of-court proceedings. The most common process is managed by a public trustee out of court and takes about six months.
Pre-foreclosure Period.
The public trustee for each county is either appointed by the governor or elected by the public.
The out-of-court foreclosure process begins when a lender files the appropriate documents with the public trustee to request a sale of the property. Once the public trustee officially records the foreclosure action, a foreclosure sale can be scheduled.
After the sale is scheduled, the lender still has to obtain a separate court order allowing the sale. The court schedules a hearing to consider the matter, and all affected parties are notified. If no one contests that the borrower is in default, the court allows the sale without a hearing. If the borrower plans to pay off the default and stop the foreclosure, he or she needs to submit the intention to do this to the public trustee at least 15 days before the sale. If this is done, the borrower can pay off the default and discontinue the foreclosure process up until noon the day before the sale.
Notice of Sale / Auction
The public trustee schedules the sale 45-60 days after the initial foreclosure action was recorded. The notice of sale is published in a local newspaper for five weeks. The public trustee also mails a copy of the notice to the borrower. The public trustee typically conducts the sale at the courthouse. At the sale, the public trustee reads the written bid submitted by the lender, and any party may bid. If anyone other than the lender is the winning bidder, that person must deliver the bid amount in cash or cashier’s check to the public trustee. The winning bidder is given a certificate of purchase. After the sale, the borrower usually has 75 days to redeem the property by paying the total winning bid plus interest and costs. If the borrower does not redeem, junior lien holders may do so. If no one redeems, the public trustee transfers ownership to the winning bidder.
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Jeffery McClintock, is a real estate broker in Denver and prides himself on providing clients with professional guidance in all phases of residential new construction, including market research, product development, consulting, marketing and advertising. His personal mission is to bring to you a level of knowledge, experience, commitment, high standards and results to answer your real estate needs. He believes, the most effective way to provide superior service is to build a strong working relationship with you. His system includes regular consultations and feedback, which is the best tool for identifying and clarifying your real estate objectives and help define strategic solutions.
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