Frequently Asked Questions about Foreclosures

What is foreclosure?

• Foreclosure is a legal process wherein a creditor who holds a mortgage on your home requests that it be sold in order to satisfy or repay amounts that are past due. As a result, the homeowner loses the right to the property. A foreclosure can also seriously affect your ability to qualify for credit in the future.
• Laws concerning foreclosure can be found in Title 38 of Colorado Revised Statutes, Article 37, 38, and 39. Statutes can be found online at: http://www.lexisnexis.com/hottopics/colorado.

What is a Rule 120 hearing?

• A Rule 120 hearing is the result of motion that is being filed by the lender asking the District Court of the county where your house is located for an order authorizing the foreclosure sale.  A Rule 120 hearing determines if the lender has the right to foreclose on the property and have it sold at a public auction. The judge may cancel this hearing and sign the order “authorizing sale” if the borrower does not file an answer with the court or files the answer too late.
• You have up to 7 days prior to the date set for hearing in which to file a response with the court. If you do not file a response by 7 days prior to the hearing, the order will be entered authorizing the sale, even if you appear at court.
• To determine whether you have a defense to a lender's motion under Rule 120 you may want to seek the assistance of an attorney.

How do I file an answer to a Rule 120 (foreclosure sale)?

• Instructions can be found online at: http://www.courts.state.co.us/Forms/Forms_List.cfm?Form_Type_ID=197
• The answer and any supporting documents must be filed with the Court and mailed to the Plaintiff(s) not less than 7 days prior to your hearing date.

I received a notice of foreclosure. Do I have to move out?

• You do not need to move out right away. If the Court authorizes the sale of your home, you will not need to move out until after it is sold. Once a foreclosure sale has occurred, you are no longer the owner of the house. Once the deed to the property is issued, then it is likely that you will receive communication from the new owner asking you to leave the property. If you do not leave the property, then the new owner has the right to remove you from the house by filing an eviction action against you.

I have been out of work and have tried to work with my bank. Will the Judge take this into consideration?

• The Court’s review of the case is very limited. The Court shall determine if there is reasonable probability that a default occurred and whether an order authorizing sale is proper. Based on this, the Court will grant or deny the motion authorizing the sale.

What resources are available to me during my foreclosure?

• The Colorado Foreclosure Hotline, p: (877) 601-4673. Please visit their website for additional information: http://www.coloradohousingconnects.org/foreclosure-prevention.html
• Colorado Legal Services has a section dedicated to foreclosures. Please visit their website for further information: http://www.coloradolegalservices.org/
• If you feel you were defrauded by your mortgage broker, foreclosure rescue company or a loan modification firm, you can contact the Mortgage Fraud Information Center at the Colorado Attorney General’s Office, p: (800) 222-4500.
• Your local housing authority office may also be able to assist with the following:
  • Counseling
  • Rental assistance (once you are evicted)
  • Foreclosure intervention programs