Curious what a public trustee is in Colorado

Wondering whose side the public trustee is on.

Somewhere in the last couple days a new word has appeared in your life. Maybe you overheard it, maybe you saw it on a formal document or maybe you read it in passing. But now, you’re curious, a little unsure, and feeling like you should get to the bottom of it soon. I see that, and it’s a good instinct to follow because a public trustee is stranger than the name lets on.

Wondering who these people are

The public trustee is a neutral third party public official who helps manage real estate loans between buyer and lender. State law creates an office in every Colorado county, and in most counties your county treasurer is the one holding the trustee title (CRS 38-37-101).

They operate as the impartial administrator if there is ever a dispute between the parties. The most common dispute is borrower default or foreclosure processing. To paint the picture clearly, the lender cannot start a foreclosure without filing its paperwork, a document called the notice of election and demand, with the public trustee of your county (CRS 38-38-101(1)) along with many other requirements in this process.

In another case, there are duties between trustee and homeowner. Within twenty days of that filing, the trustee must mail the owner the combined notice that officially tells them about the sale (CRS 38-38-103). If they ever catch the loan up, that paperwork goes through this same office. And if an auction ever brings in more than what is owed, the extra money must be paid by this office, not kept by the bank. The public trustee is not a rescuer or a predator. They are a referee with duties to both sides, written into law.

The clarity you were looking for

There is a reason Colorado works this way. In this state, the document behind a home loan is generally called a deed of trust, not a mortgage. And what makes a deed of trust comes down to two things it contains: a grant to a public trustee, and something called a power of sale (CRS 38-38-100.3(7)). In plain words, the loan paperwork itself names the public trustee and gives it the authority to sell the home if the loan ever went unpaid.

So, to make sure there is no confusion, a trustee sale is considered the foreclosure sale in Colorado. It is not a new threat and not a separate process. It is one event, with two labels.

The word can be just a word again

You came here composed, studying a term like it was homework but it may be more than that for your home. If it is, the same instinct that brought you here will serve you for whatever comes next. If a day comes when you want help specific to you, we at Transitus can show you your options.

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.