Since the dot-com bust in 2000, Colorado has seen a significant amount of foreclosures throughout the Denver Metro area. In an effort to help struggling homeowners, House Bill 09‐1276 was introduced in 2009. This bill made several changes to Colorado foreclosure law and provides homeowners a 90-day extension on their current foreclosure sale date. The 90-day extension provides additional time for homeowners to negotiate a workout with their mortgage company and avoid foreclosure. The foreclosure deferment is only available to homeowners whose property entered into the foreclosure process after August 1, 2009, and applies to most individuals who currently face foreclosure.
Explanation to Homeowners
Eligible borrowers will receive a Notice of Opportunity for Foreclosure Deferment posting on their property. The notice tells you to contact a foreclosure avoidance counselor within 20 days of the posting to determine if you are eligible for a deferment. After the meeting, you will know if you qualify within 24 hours of the appointment. To find HUD-approved foreclosure avoidance counselors in your area, review the following section of this website.
This 90-day foreclosure deferment DOES NOT guarantee that that a lender will extend a mortgage workout or withdraw the foreclosure. All workouts with a lender must be negotiated separately. There are loan limits and higher-end homes are not eligible for the deferment program.
If you qualify for the deferment, the following terms will apply:
- 90-day extension of the foreclosure sale at the public trustee, which is extended on a weekly or monthly basis.
- You must make monthly payments equal to 66 2/3% of the monthly principal and interest payment, plus the amount for taxes, insurance, and any applicable HOA or mortgage insurance. Example: (Payment = 66 2/3% of P&I + T&I + PMI + HOA for three months)
- Once you qualify for the deferment, the first payment outlined above is due within five days.
- All payments are due every 30 days thereafter and MUST BE paid in a timely manner.
- You and your mortgage company must come up with a solution to the delinquency.
- This should not be used when doing a short sale.
The deferment will be terminated if ANY of the following occur:
- The payments are not made on time or in the correct amounts.
- You transfer ownership of the property.
- You add additional charges or liens to the subject property.
- Another lien on the subject property forecloses.
- You file bankruptcy during the deferment.
