Lifespan of a Public Trustee Foreclosure Action in Colorado

BEVERLY L. EDWARDS, ESQ.

THE ROCKY MOUNTAIN LAW GROUP, LLC

            Colorado’s Public Trustee foreclosure system is unique.  Other states must foreclose through the courts, which is more time consuming and costly than Colorado’s system.  Colorado’s non-judicial foreclosure process provides for administration of the foreclosure process through the county public trustee, with minimal court involvement.  Colorado’s  foreclosure process allows the borrower an opportunity to reinstate the loan or challenge the default on the loan, provided the borrower follows the rules under Colorado law.  The Colorado system is beneficial to the lender because it provides a straightforward method for realizing on its collateral.

            The public trustee foreclosure process is driven by the deadlines under Colorado law.  The deadlines provide lenders with a greater level of certainty in the conduct of the proceedings.  The official document that commences the foreclosure action is the “Notice of Election and Demand”.  In the Notice of Election and Demand, the lender is giving “notice” of the default in the loan documents, “electing” to accelerate the entire balance due on the loan and “demanding” that the public trustee give notice of the sale, advertise for sale, and sell the property secured under the deed of trust.  The Notice of Election and Demand is part of the initial filing with the public trustee and is recorded with the county clerk and recorder.

After the initial filing with the public trustee, the public trustee must set the foreclosure sale within 4-4-1/2 months after the Notice of Election and Demand is recorded.  The public trustee then issues a confirmation deed approximately 30 days after the sale.  The entire process (from the initial filing with the public trustee to issuance of the deed) takes approximately 5 to 5-1/2 months.

For agricultural property, the process is longer.  Agricultural property is property that is 1) not platted as a subdivision 2) not located within an incorporated town or city or 3) valued or assessed as a type of property that is not agricultural property.  The law requires that the foreclosure sale be held 7 to 7-1/2 months after the Notice of Election and Demand is recorded. As with non-agricultural property, the public trustee issues a confirmation deed approximately 30 days after the sale. From the initial filing with the public trustee, to the issuance of the deed, the entire process for agricultural property takes approximately 9 to 9-1/2 months.

The foreclosure process in Colorado is quicker and more efficient than the judicial system utilized in other states.  However, our expedited system demands that deadlines and rules are strictly followed.