Colorado Modifies Statutes related to Assisting in Foreclosure Proceed Recovery
By Robert Harrison, J.D.
Colorado has modified provisions regarding the conditions under which a person may assist another for compensation in obtaining the proceeds of a foreclosure sale after all liens have been satisfied.
- Colorado Revised Statutes, 6-1-105, has been modified to add examples of deceptive trade practices. A deceptive trade practice now includes entering into an agreement concerning the recovery of an overbid on foreclosed property if the agreement is concerning the recovery of funds in the possession of “a public trustee prior to transfer of the funds to the state treasurer under section 38-38-111, C.R.S. or, the state treasurer and does not meet the requirements for such an agreement as specified in section 38-13-128.5, C.R.S.”
- Colorado Revised Statutes, 6-1-110 (4)(a)(IX), has been repealed and a foreclosure Consultant may no longer assist the home owner in obtaining the remaining or excess proceeds from the foreclosure sale of the residence in foreclosure.
- Colorado Revised Statutes, 38-38-111(2.5)(c), has been added to prohibit agreements to assist in recovery of overbids due to the owner from the public trustee. Such agreements are not enforceable. A person who enters into or attempts to enter into such an agreement is subject to imprisonment in county jail, a fine, or both.
- Colorado Revised Statutes, 38-38-111(3)(a), has modified the time period for which the overbid from a foreclosure sale must held from five years to six months.
- Colorado Revised Statutes, adds 38-13-128.5 which says an agreement to pay compensation to recover an unclaimed overbid transferred to the administrator is not enforceable unless entered into 2 years or more before the date of transfer and is only enforceable if certain conditions are met.
These provisions are effective on August 10, 2016. More information regarding these changes about the conditions under which a person may assist another for compensation in obtaining the proceeds of a foreclosure sale after all liens have been satisfied can be found in the PDF version of this article on our website.
About the Author
Robert Harrison, J.D. is a Regulatory Compliance Consultant at Bankers Advisory. He is a graduate of Boston University and earned his Juris Doctor at the Boston University School of Law. Robert is admitted to the Bar in Massachusetts. He can be reached at robert.harrison@bankersadvisory.com
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