Foreclosure Filing Requirements in Colorado by Sherry Hewlett

ACCEPTING NEW FORECLOSURE SUBMISSIONS BY SHERRY HEWLETT, ELBERT COUNTY TREASURER/PUBLIC TRUSTEE

COMMON TERMS YOU WILL SEE THROUGHOUT THIS PRESENTATION: Notice of Election & Demand = NED Deed of Trust = CDOT or DOT Note = CNOTE or NOTE Lost Instrument Bond = LIB Certificate of Qualified Holder = CERTQH Mailing List = ML Statement of Loan Servicer = SLS Affidavit of Current Ownership = ACO Cover Sheet = COVER Exhibit A Legal Descriptions = EXHIBITA Loan modification = CLOANMOD Scrivener s Error Affidavit = SCV DATADOC GTS Import Template

WHO CAN FILE A FORECLOSURE IN COLORADO? The holder of the Evidence of Debt (Note) or their counsel can file a foreclosure

WHAT IS REQUIRED TO FILE A FORECLOSURE IN COLORADO? Deposit of $650.00, or determined by C.R.S. 38-38-101(10) payable to the Public Trustee either by ACH or check. Whatever form of tender your county requires. Deed of Trust: either the Original is overnighted or a copy of the recorded Deed of Trust along with the Certificate of Qualified Holder of the Evidence of Debt is provided by the foreclosing law firm pursuant to C.R.S. 38-38-100.3 (20) Any Recorded Modifications of the Deed of Trust or Recorded Partial Releases Original Evidence of Debt (the Note) secured by the Deed of Trust; or a copy of the Evidence of Debt and with the Certificate of Qualified Holder of the Evidence of Debt C.R.S. 38-38-100.3 (20) and C.R.S. 38-38-101 (2)

Sheryl L. Hewlett TREASURER/PUBLIC TRUSTEE P.O. BOX 67 440 COMANCHE STREET KIOWA, COLORADO 80117 303-621-3120 FAX: 303-621-3164 Foreclosure Requirements When a lender decides to proceed with filing a foreclosure action, the following documents are required under Colorado Statute: Colorado Revised Statute 38-38-102 Requires that the Notice of Election and Demand ("NED") contain the following information: 1.The names of the Original Borrower (Grantee) and Lender (Grantor) 2.The name of the Current Holder of the Evidence of Debt (Note & Deed of Trust) 3.Date and recording information of the Deed of Trust 4.The Original loan amount and the current outstanding principal balance due 5.Legal description exactly as it appears on the Recorded Deed of Trust 6.A statement as to whether the foreclosure is for all or a portion of the property 7.A statement of what the covenant violation is (example: Failure to make monthly payments, Failure to make tax and insurance payments, Failure to reside in the home, Death of borrower, etc.) 8.Attorney name, Colorado Bar Registration Number, address and phone number The Original Deed of Trust; a certified copy of the recorded Deed of Trust; or a copy of the recorded Deed of Trust accompanied by a Statement of Qualified Holder as defined in C.R.S. 38-38-100.3(20) and C.R.S. 38-38-101(2). The Original Evidence of Debt (commonly called a "Note") secured by the Deed of Trust or a copy of the Original Evidence of Debt accompanied by a Statement of Qualified Holder as defined in C.R.S. 38-38-100.3(20) and C.R.S. 38-38-101(2). 1.If the Evidence of Debt has been lost, the holder must purchase a corporate surety bond equal to 1.5 times the face amount of the loan. A mailing list pursuant to C.R.S. 38-38-100.3(14) containing the names of the original Borrower (Grantor), Current property owner, any Lien holders of record in indexing records and notice to the "Occupant" and "Lessee" - this can be a combined as "Occupant/Lessee." A statement of Current Ownership ("ACO") pursuant to C.R.S. 38-38-101(1)(g). A statement of the Current Loan Servicer ("SLS") pursuant to C.R.S. 38-38-101(1)(f.5), if applicable. This document is optional under the statute. A deposit check in the amount of $650.00, made payable to the Elbert County Public Trustee. Public Trustee fees must be paid at the time the foreclosure is filed, and any unpaid balances must be paid prior to the foreclosure auction.

WHAT HAPPENS IF THE ORIGINAL NOTE IS LOST? A Lost Instrument Bond must be submitted in its place! Must be equal to one and one-half times the face amount of the original debt The ORIGINAL Lost Instrument Bond must be sent to the respective Public Trustee s office

IN ADDITION TO THE DOT & NOTE, WHAT OTHER DOCUMENTS ARE REQUIRED? Notice of Election and Demand Certification of Qualified Holder (if the law firm is submitting copies of the CNOTE & CDOT) Mailing List Affidavit of Current Owner Cover Letter Statement of Loan Servicer this is optional under the current statute

What about the Default type? The NED must detail the Default type. The default can range from Non-Payment, Matured Loan, Death of Borrower, Failing to use the home as a principal residence This is so important because the borrower (or successor) might not be allowed to cure a loan and must pay it off instead.

WHAT ABOUT THE ANNUAL PERCENTAGE RATE (APR)? We always obtain this information with the first legal filing to save time later in the foreclosure process. We use it when an Intent to Redeem is filed and the COP holder fails to provide redemption figures. We have the authority to calculate the redemption figures and we would use the APR (also called Interest Rate) in the file. Sometimes the APR is adjustable and changed at bid review or it remains the same throughout the foreclosure. For redemption we would use the latest Interest Rate provided by the law firm on the Bid.

WHAT ABOUT THE LOAN TYPE? If you can determine the loan type on the NOTE or if the attorney provides the loan type, use it. Otherwise, loan type can be selected as CONVENTIONAL. It does not affect the foreclosure if this information is incorrect.

WHY DO WE PROOF THE SUBMISSION FOR ERRORS AND DISCREPANCIES? It is imperative to catch these errors at submission because wrong information on the submission can nullify a foreclosure action The property address and legal description is not just information on the face of a document. They are what Assessor s use to change ownership in property records. Even minor errors can result in a null and void foreclosure that must be started over and the expenses associated with it cannot be passed to the borrower. Bottom line: never trust that the foreclosing law firm didn t make a mistake. We are all human.

PROOF THE NOTICE OF ELECTION & DEMAND FOR ERRORS AND DISCREPANCIES 1. Compare the NED to the Deed of Trust 2. Then compare the NED to the Note 3. Finally compare the NED to the DATADOC, GTS Import Template or the PUSH data. If you find an error on the NED, chances are high that the error carries over to all other documents. Proof all of the documents in the entire submission before notifying the law firm that we are not accepting the package. This will save you time later if they resubmit again. Catch all errors at once.

NED CDOT

PROOFING THE LEGAL DESCRIPTION & PROPERTY ADDRESS IT IS IMPORTANT THAT THEY MATCH EXACTLY! If the foreclosing law firm has any of this info wrong on their document, it could result in an erroneous foreclosure on the wrong property.

WHAT IF THE DOTS LEGAL DESCRIPTION HAS ERRORS? The errors can be corrected via a Scrivener s Error Affidavit (SCV) This document would be drafted, executed and recorded by the foreclosing law firm The recording information for the SCA must be listed on the NED

Example Scriveners Error Affidavit

METES & BOUNDS LEGAL DESCRIPTIONS Agricultural properties are entitled to a longer foreclosure process under the statute. This is normally caught when the property has a metes & bounds legal description. Verify the property status with your county Assessor

Assessor Agriculture Certificate ELBERT CTY OFFICE OF THE ASSESSOR AGRICULTURAL/RESIDENTIAL CERTIFICATION The Assessor s Office of County of Elbert, does hereby certify that the property described as follows: Public Trustee File No: 2024-021 Schedule No: R123346 Grantors: ROGELIO BOLIVAR AND STEPHANIE POINT (Provided by Public Trustee) Assessor Owner of Record: ROGELIO BOLIVAR AND STEPHANIE POINT Situs Address: 46000 County Rd 53, Bennett, CO 80102 Legal: LEGAL DESCRIPTION PROVIDED BY PUBLIC T NED Is valued and assessed as AGRICULTURE. Prepared by: Susan Murphy Elbert County Assessor s Office Thank you very much. Please contact our office if you have any questions. Respectfully, Elbert County Assessor s Office

PROOFING THE NED TO THE NOTE Compare the NED to the NOTE the same way you did with the DOT Make note if the loan is an Adjustable Rate Note. If the foreclosing law firm provides a APR that is different from the NOTE, and the NOTE is not adjustable, there might be a Loan Modification. Ask the law firm to verify.

WHEN WOULD WE NEED AN AFFIDAVIT OF DISCREPANCY FROM THE FORECLOSING LAW FIRM? If there is a discrepancy between the DOT & NOTE as to borrower names, loan amounts, dates, loan amounts

Mailing List & Mailing Requirements The Mailing list must include an address for the Occupant, Tenant & Lessee. It must include a mailing for the borrower at the property and the address on the ACO if that address is different. We require both the property and the address listed on the ACO to ensure property notice of the borrower has been perfected. It is easier to notify at multiple addresses up front rather than trying to clean up after missing any. Finally, the ML must match the data coming from the foreclosing law firm on the GTS Import Template or PUSH file.

DID YOU KNOW THE DOT & NOTE TELL US HOW TO CORRECTLY NOTIFY THE BORROWER OF THE FORECLOSURE? The Notices paragraph of the DOT will verify how notice should be made upon the borrowers. May include: Regular 1st Class Mail, Certified Mail, Personal Service, Overnight Mail.

CERTIFICATION OF QUALIFIED HOLDER C.R.S. 38-38-100.3(20) If a Qualified Holder is submitting copies of the loan documents, the CERTQH must accompany the loan documents. The Holder must indicate they are submitting copies of the loan documents, including loan modification, and must indicate what applies to the loan from the following options under the statute. Most common responses will be: A Bank D Supervised Lender F FHA Loan G Credit Union

(a) A bank as defined in section 11-101-401 (5), C.R.S.; (b) Repealed. (c) A federally chartered savings and loan association doing business in Colorado or a savings and loan association chartered under the Savings and Loan Association Law, articles 40 to 46 of title 11, C.R.S.; (d) A supervised lender as defined in section 5-1-301 (46), C.R.S., that is licensed to make supervised loans pursuant to section 5-2-302, C.R.S., and that is either:(I) A public entity, which is an entity that has issued voting securities that are listed on a national security exchange registered under the federal Securities Exchange Act of 1934 , as amended; or (II) An entity in which all of the outstanding voting securities are held, directly or indirectly, by a public entity; (e) An entity in which all of the outstanding voting securities are held, directly or indirectly, by a public entity that also owns, directly or indirectly, all of the voting securities of a supervised lender as defined in section 5-1-301 (46), C.R.S., that is licensed to make supervised loans pursuant to section 5-2-302, C.R.S.; (f) A federal housing administration approved mortgagee;

(g) A federally chartered credit union doing business in Colorado or a state-chartered credit union as described in section 11-30- 101, C.R.S.; (h) An agency or department of the federal government; (i) An entity created or sponsored by the federal or state government that originates, insures, guarantees, or purchases loans or a person acting on behalf of such an entity to enforce an evidence of debt or the deed of trust securing an evidence of debt; (j) Any community development financial institution that has been certified and maintains such current status from the community development financial institutions fund administered by the United States department of the treasury, referred to in this section as the fund . In order to be a qualified holder under this article, the community development financial institution must:(I) Be a legal entity; (II) Have a primary mission of promoting community development; (III) Be a financing entity; (IV) Primarily serve one or more target markets as defined by the fund; (V) Promote development services in conjunction with its financing activities; (VI) Maintain accountability to its defined target market; and (VII) Be a nongovernmental entity and not be under the control of any governmental entity; except that a tribal government is exempt from the requirements of this subparagraph (VII).

(k) Any entity with active certification under the fund that originates, insures, guarantees, or purchases loans or a person acting on behalf of such an entity to enforce an evidence of debt or the deed of trust securing an evidence of debt; (k.5) A private company that originates, insures, guaranties, or purchases loans on behalf of a holder of evidence of debt that is secured by a deed of trust encumbering a time share estate as defined in section 38-33-110 (5), with a minimum of five million dollars in assets or not less than one thousand active loans; or (l) Any entity listed in paragraphs (a) to (k) of this subsection (20) acting in the capacity of agent, nominee except as otherwise specified in subsection (10) of this section, or trustee for another person.

EXAMPLE OF A FULL CERTQH

EXAMPLE OF A MODIFIED AND SHORTENED CERTQH THAT ONLY LISTS THE APPLICABLE SECTIONS OF THE STATUTE.

AFFIDAVIT OF CURRENT OWNERSHIP This document lists the current address of the borrower. If the address differs from the property address, make sure that both addresses appear on the Mailing List

STATEMENT OF LOAN SERVICER If there is a loan servicer and the loan servicer is not the holder, we need this document. It does not need to be submitted on all files as it doesn t apply to all situations.

STATEWIDE PUBLIC TRUSTEE NAMING CONVENTIONS NED=Notice of Election and Demand for sale NOTE=Original Note (evidence of debt) NOTEASSIGN=Original indorsement or assignment of the note (evidence of debt) NOTEMOD=Original Note Modification CNOTE=Copy of note (ev. of debt) certified to be a true and exact copy by a Qualified Holder or their attorney. CNOTEASSIGN=Copy of indorsement or assignment of the note (evidence of debt) CNOTEMOD=Copy of Note Modification CERTCNOTEMOD= Copy of Loan Modification Agreement certified to be a true and exact copy by the Clerk & Recorder of Jefferson County LOANMOD=Original loan modification CLOANMOD=Copy of loan modification certified by a Qualified Holder or their attorney CERTJUD=Certified copy of a monetary judgment entered by a court DOT=Original Deed of Trust DOTASSIGN=Assignment of Deed of Trust DOTMOD=Original Deed of Trust Modification CDOT=Copy of Deed of Trust certified to be a true and exact copy by a Qualified Holder or their attorney CDOTASSIGN=Copy of Assignment of Deed of Trust older or their attorney CERTCDOTASSIGN= Copy of Assignment of Deed of Trust certified to be a true and exact copy by the Clerk & Recorder of Jefferson County CDOTMOD=Copy of Deed of Trust Modification CERTDOTMOD= Copy of Deed of Trust Mod. certified to be a true and exact copy by the Clerk & Recorder copy by the Clerk & Recorder CERTQH=Statement by a Qualified Holder or their attorney that copies of the EOD and DOT are being submitted pursuant to CRS 38-38-101 CERTQHEOD=Statement by a Qualified Holder or their attorney that copies of the EOD are being submitted pursuant to CRS 38-38-101t CERTQHDOT=Statement by a Qualified Holder or their atty that copies of DOT are being submitted pursuant to CRS 38-38-101t PRL=Original partial release CPRL=Copy of a partial release certified to be a true and exact copy by a Qualified Holder or their attorney CERTPRL=Partial release certified to be a true and exact copy by the Clerk & Recorder of Jefferson County COVER=Cover Letter ACO-SLS= Cover letter witha statement identifying the name and address of the current owner of the property and a statement identifying the name of the loan servicer ML=Initial Mailing List (must be submitted in Word and Tiff file format) POA=Power of Attorney SCV=Affidavit affecting the Deed of Trust (Affidavit Scrivener s Error ) SLS=A statement identifying the name of the loan servicer ACO=A statement identifying the name and address of the current owner of the property AGC=Agricultural Certificate ALLONGE=Allonge AFFIDAVIT=Affidavit for Discrepancy EXHIBITA (all caps ) =Legal in excess of 4 lines must be submitted as an exhibit in Word and tiff file format DATADOC=DATADOC in Word format

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