Proposed Colorado Foreclosure Law to Straighten Out Mortgage Brokerage Game!
While Colorado has been described in less-than-appealing terms as being the "Wild, Wild West" of mortgage fraud, its Governor and director of the state real estate division are hoping to see that image change.
A recent story in ColoradoBiz Magazine detailed how Governor Bill Ritter is expected to sign five bills that would go directly after the shady practices which have emerged in the wake of people desperately needing to stop foreclosure in the state, and that Erin Toll will serve as the regulator of these new rules of the trade.
From going after unscrupulous mortgage brokers to attacking phone home appraisals, these proposed laws are taking serious aim at the Colorado foreclosure problem.
Colorado had the greatest percentage of foreclosures per household of all 50 states last year. Specifically, there was one foreclosure per every three households in Colorado in 2006. There were more than 37,400 foreclosures in Denver alone last year.
With such information in mind, state legislators have been working hard this year to draft legislation that would bring more regulation to the foreclosure problem. One of these bills would put Colorado up to speed with 48 other states by licensing mortgage brokers.
The ColoradoBiz Magazine story detailed how Colorado was second-to-last and just in front of Alaska in requiring mortgage broker registration. Under this proposed Colorado foreclosure law, brokers would have to undergo training, pass competency tests, post $25,000 surety bonds, and even pay restitution for those harmed by illegal and deceitful practices.
As just one example of the far-ranging effects of this legislation, mortgage brokers would have to get fingerprinted and pass background checks from the Colorado Bureau of Investigation and the FBI. Convicted felons and those who have previously been thrown out of the profession will be denied licensing.
As for those mortgage brokers who have been accused of misrepresenting loans to customers, they would face some very stiff penalties. First offenses would come with a $1,000 fine while each subsequent offense would equal a $2,000 fine. These mortgage brokers would also have to pay the attorneys' costs for the plaintiffs. And if Colorado mortgage brokers were to lose their licenses, they would have to wait two years to reapply.
Toll said that she is very excited about this piece of legislation and said that Colorado has come a long way in terms of having no licensing for mortgage brokers to possibly having some of the strongest requirements around. She also said that this proposed Colorado foreclosure law will have a positive impact on the slumping real estate market in the state by bringing everyone up and running under the same rules.
The story detailed how a Ritter spokesman said that the Governor is very close to signing this bill and other proposed Colorado foreclosure laws. Visit our popular New Foreclosure Laws page for the latest updates on this Colorado legislation and similar efforts in other states.
Need to Sop Foreclosure in Denver or Somewhere Else in Colorado?
While this new legislation may not do much for people who currently need to stop foreclosure in the state, they may still have options at Foreclosure-Fighter. Get started by contacting a local attorney who can assess your current financial situation and help you determine if refinancing, debt workout plans, Chapter 13 bankruptcy or other foreclosure options may help you stop foreclosure and keep your home.
Whether you need to stop foreclosure in Colorado, Georgia, Nevada, Texas, Michigan, North Carolina, Ohio, Iowa, Indiana, Washington, New Hampshire or another state, you need to take action immediately before it's too late.