In foreclosure: unsure how to sell the right way

Wanting to sell, concerned about doing it wrong.

A notice came recently and it felt like a door slamming shut. The fear was real and that quiet voice kept saying you waited too long. Now you’re here, wondering what the best ways are to sell your home and if the foreclosure could stop you. The empowering truth is a foreclosure auction is not the only path you have available. Instead, in most cases you still have the opportunity to dictate if you can sell your home. If you aren’t sure if you can or cannot it’s okay but I would begin learning that first. If you are sure, you came here asking how to sell your home in foreclosure, and I'm going to walk you through it the whole way.

The pressure and urgency to get the best outcome

Before anything else, breathe. The auction is not tomorrow but understanding how much time you have, is the first important part of this process. In a Colorado foreclosure, the sale has to be set no sooner than 110 and no later than 125 days after the bank records its notice (CRS 38-38-108(1)(a)). That's roughly three and a half to four months from when the formal process even begins. I'm not telling you this to make you feel behind. I'm telling you because every one of those days that goes by you have less and less options of how you can sell. I know that puts pressure on you but to get the best outcome for you it’s important to move with purpose. If you’re curious about your specific options given your circumstances, we at Transitus are here to show you exactly that.

Some busy work but valuable information

You can't sell a home until you know exactly what it would take to clear the loan, and that starts with the company that handles your mortgage, your servicer. The good news is Colorado puts that contact right in front of you so I hope this process is easy as I know everything else hasn’t been. At least 30 days before the bank files for foreclosure, they have to mail you a notice with helpful foreclosure support information. Now the important part: many people would say to call your servicer and ask for two things: a written payoff number, meaning the full amount of the loan as of the given date, and the name of whoever handles loss mitigation on your account. With a payoff number in hand, you’ll know whether a sale covers the debt of your home or whether you'll need a different path. Everything after this depends on that one figure.

The worry you don’t have enough time to sell

You might be thinking, now I have some clarity on how to begin, but how do I sell before the auction when selling can take months? This is where the law quietly helps you and us at Transitus can help process sales quickly or show you what’s available if you need the support. From the law angle, a sale or short sale counts as loss mitigation, so when you turn in a complete application on time, the servicer can't move forward with the foreclosure sale while it reviews it (12 CFR 1024.41(g)). Thankfully, Colorado backs this up: if you have the servicer's written confirmation of a complete application on time, the officer has to pause the foreclosure while they confirm it with your servicer (CRS 38-38-103.2(1) and (3)). None of this happens on its own, and the deadlines are firm, so you have to move with urgency. But it means the act of pursuing a sale can buy you the very weeks or months you need to dodge foreclosure.

Real honest help that doesn’t cost you anything

You don't have to figure all of this out alone, and you should never pay someone up front to do it. Free, expert foreclosure help exists from HUD-approved housing counselors, and you can reach one by calling the CFPB at (855) 411-2372. There's also the Colorado Foreclosure Hotline, the number that came on your notice. During this complex process please remember this one thing: under Colorado law it is illegal for a foreclosure consultant to charge you an up-front fee (CRS 6-1-1107). So if anyone asks for money before they've actually done anything, that's your signal to walk away. Real help, the kind that's actually on your side, doesn't bill you to start.

I know deep down you may not want to sell your home and if it feels like you have to, that is draining. I see that. I do. If your situation is still tangled, or you just want to see what selling actually looks like for your situation, that's how we can help at Transitus. You still have moves here. You still have options. Let's find the best one for you and your family.

This article is general information from Transitus, not legal, financial, or tax advice. Foreclosure rules change and every situation is different. Transitus is not a foreclosure consultant (CRS 6-1-1103) and charges no upfront fees. For free help, call the Colorado Foreclosure Hotline at 1-877-601-HOPE or consult a Colorado real estate attorney.