On January 19, 2012, Sen. Angela Giron and Rep. Cristana Duran introduced SB 12-071 – Concerning a Requirement to Pursue Available Loan Modification Remedies Before Foreclosing on Residential Real Property. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.
The bill requires the holder of an evidence of debt to pursue modification remedies before foreclosing on a residential property. Before initiating or completing the process of foreclosing on residential real property containing 4 or fewer dwelling units, the bill requires holders of an evidence of debt to make and fully document its efforts to:
- Contact the borrower directly;
- Negotiate in good faith with the borrower in an effort to effectuate a cure for default rather than move directly into the foreclosure process;
- Fully assess the eligibility of the borrower, the property, and the loan for any available public or private loan modification programs or other alternatives to foreclosure;
- Communicate with, and inform, the borrower about impending deadlines and the consequences of missing them at every major step of the foreclosure process;
- Carry the burden of proof in court proceedings regarding the holder’s compliance with procedural as well as substantive requirements before obtaining an order authorizing sale of the property under rule 120 in the Colorado rules of civil procedure; and
- Abide by the terms of any offer of modification it makes, if the borrower signs and returns documents containing those terms.
The bill is assigned to the Judiciary Committee; a hearing date is not listed on the printed calendar.
Summaries of other featured bills can be found here.