Underwater and divorcing

Foreclosure and divorce in Colorado

A Colorado foreclosure runs on the Public Trustee’s calendar, not the court’s. If the mortgage stops getting paid while the divorce is pending, the sale date arrives whether or not the decree is done. Here is the clock, who is on the hook, and the four ways out.

Call the divorce team 303-955-4220 Colorado Foreclosure Hotline 1-877-601-4673 Short sale and divorce

Call or text 303-955-4220. A live person answers. Not a robot, not a phone tree.

The clock

About four months after the filing

The lender files a Notice of Election and Demand with the county Public Trustee; the sale is set 110 to 125 days later. Missed payments come before that.

The decree

Does not bind the lender

If both names are on the note, both are liable and both credit reports take the hit, whatever the decree says about who pays.

The cure

Reinstate up to noon the day before

Colorado lets you cure by paying the arrears and costs with a written intent to cure filed 15 days before the sale.

The help

Free counseling and legal aid

The Colorado Foreclosure Hotline (HUD-approved counselors) and Colorado Legal Services. Call before the clock runs, not after.

The short answer

Keep the mortgage current during the divorce if there is any way to do it, because the foreclosure timeline does not pause for the case. If payments have already stopped: call the Colorado Foreclosure Hotline today, get the sale date from the Public Trustee, and choose one of four exits while there is still time to execute it: reinstate, sell, short sale, or deed in lieu.

The Colorado foreclosure timeline

Missed paymentsLate fees at 15 days, credit reporting at 30, servicer contact and loss-mitigation offers in the first 120 days under federal servicing rules (12 C.F.R. 1024.41).

Notice of Election and Demand (NED)Filed by the lender with the county Public Trustee after default, usually after 120 days. The Public Trustee records it and mails notice; the sale date is set 110 to 125 days out.

Rule 120 hearingThe lender asks the district court for an order authorizing the sale. You can respond and be heard; this is where a pending divorce and a disputed obligation get raised.

Intent to cureFile it with the Public Trustee at least 15 days before the sale; pay the cure amount by noon the day before the sale to reinstate.

The saleA public auction at the Public Trustee’s office. Colorado has no post-sale redemption for the owner; junior lienholders have short redemption windows.

After the saleThe lender can pursue a deficiency judgment for the shortfall, in either spouse’s name on the note.

Who is liable, and what the decree can and cannot do

The decree divides the obligation between the spouses; it does not remove either name from the note. If the spouse ordered to pay stops paying, the lender forecloses against the property and reports both borrowers. Your remedy against your ex is a contempt or enforcement action in the divorce court, which does not stop the sale. That is why we tell the keeping spouse to refinance inside the decree’s deadline, and the leaving spouse to insist on one. Getting a name off the loan.

The four ways out

Reinstate

Pay the arrears, fees and costs before the sale. A settlement can allocate the cure between spouses; a loan from family or a retirement withdrawal (with the tax hit) are the usual sources.

If there is no money

Sell

If there is equity, a listing under a stipulation or order can close before the sale date if it starts early. Buyers close in 30 to 45 days; the lender must confirm any postponement.

Sell the house

Short sale

If there is no equity. Three to six months; the servicer must confirm a postponement in writing; the deficiency waiver must be in the approval.

Short sale and divorce

Deed in lieu

Hand the deed back by agreement. Faster than a short sale, no marketing, but the lender must accept it, junior liens block it, and the deficiency and tax questions are the same.

Get counsel first

Questions people ask

Does filing for divorce stop a foreclosure?

No. The automatic injunction binds the spouses, not the lender. Only a bankruptcy filing imposes an automatic stay, and that is a decision for a bankruptcy attorney.

My spouse was ordered to pay and did not. Am I still liable?

If your name is on the note, yes, to the lender. You can pursue your ex in the divorce court for contempt and reimbursement. Protect yourself now with alerts on the servicer account and a refinance deadline in the decree.

Can I get the arrears from the equity when the house sells?

If the decree or stipulation says so. Payments one spouse made to keep the house out of foreclosure are commonly credited back at closing; put it in writing.

Is there money to help in Colorado?

The Colorado Foreclosure Hotline connects you to HUD-approved counselors who know what programs are open today; servicers must review you for loss mitigation. Colorado Legal Services helps qualifying households with the Rule 120 hearing.

Will the foreclosure show up in the divorce?

The house’s value and the debt are on the sworn financial statement either way. A pending sale date changes the timeline of the whole case; tell your attorney the day the NED arrives.

Hard times, handled quietly

We have sold underwater houses, negotiated short sales and stopped foreclosure clocks for divorcing owners. Quietly.

A divorce with no equity, two incomes that just became one, and a lender who does not care about the decree is the file we see most in a down year. The Kenna divorce real estate team, led by Damon L. Chavez, Certified Real Estate Divorce Specialist, runs the numbers first and tells you the truth: sell, short sale, hold, or fight the foreclosure.

Your information stays with us. We will not contact you without your permission, and nothing here is logged to an account.

A written net sheet with the house sold, short-sold and kept

The Colorado foreclosure timeline against your court dates

A lender who will tell you the truth about a refinance on one income

The hotline, legal aid and fee-waiver numbers, free

Talk to the team, free

Where to go next

Plain-language education, not advice. Divorce Decisions is published by The Kenna Real Estate Group at Keller Williams DTC, a real estate team. Nothing here is legal, tax, lending or financial advice, and reading it does not create any professional relationship. Colorado law and lender rules change; confirm anything that matters to your case with a licensed Colorado attorney, a tax professional, and your lender. See our full disclaimer.

Call your Colorado divorce agent

Questions about the house, the deed or the decree?

Call us today to talk through your situation and how we can help. A live person answers. Not a robot, not a phone tree.

Call today 303-955-4220 Download the free divorce-home guide

Get the sale date and the options, today

Tell us where the house is, whether a notice has arrived, and who is paying. We will lay out reinstate, sell, short sale and deed in lieu on your numbers, free, and point you to the hotline and legal aid. Nobody is contacted without permission.

Call or text 303-955-4220

A live person answers. Not a robot, not a phone tree. Prefer email? homes@kennarealestate.com