Mortgage lenders and bankers in the state are showing their opposition for a ballot initiative that would require lenders to prove they have a right to foreclose on a property.
Currently in Colorado, a bank can foreclose on a property with only a lawyer’s signature and no proof that money is owed to them.
The new ballot initiative, if passed, would require lenders show proof of their interest in the loan before they can seize the property. They can show this proof by recording the loan with the county or by providing certified copies, in court, of the loan’s endorsement to them.
Since the housing crisis hit, many homeowners and their foreclosure attorneys have discovered that many banks and mortgage lenders have not always been able to prove who owns the rights to mortgage loans in court. As a consequence, many people have wrongfully lost their homes to faulty foreclosure paperwork.
Bankers Associations in the state are opposed to Initiative 84, because they believe this is an issue that should be handled legislatively instead of constitutionally. And also feel it would dry up the secondary mortgage market.
All across the country, state legislators are attempting to pass laws that protect homeowners from the abuses of banks and mortgage lenders that led to the current foreclosure crisis. Foreclosure lawyers have been able to contest some of these abuses by mortgage lenders but the problem persists.
Preventing foreclosure is possible. Anyone receiving a default notice can contact a foreclosure attorney to lay out the options they have to keep a mortgage lender from seizing their property such as a short sale or a mortgage modification and even bankruptcy.