Colorado Enacts Series Of Bills Aimed At Combating Foreclosure Crisis

This past week, Colorado enacted a series of bills aimed at curtailing the state’s dramatic upswing in foreclosures.

The office of Colorado Governor Bill Ritter said Friday that he signed House Bill 1322, as well as Senate Bills 85, 203, 216, and 249. All of the bills are part of a much larger legislative package that targets the causes and symptoms of foreclosure—whether they be predatory lending or mortgage fraud.

“Colorado has one of the highest foreclosure and mortgage-fraud rates in the country,” Gov. Ritter said. “We’re on pace to log another 37,000 foreclosures this year, which was up about 30-percent from 2006, and that was up 30-percent from 2005. Those are just staggering numbers.”

The following bills are part of Governor Ritter and the Colorado Legislature’s solutions to ending the state’s dramatic rise in foreclosures:

HB 1322 (Mortgage Fraud Prevention Act) – increases the current “regime of registration for mortgage brokers by regulating the behavior of mortgage brokers and others involved in residential real estate transactions.”

SB 85 (Protect Consumer Real Estate Transactions) – “addresses the relationship between mortgage brokers and real estate appraisers.” Indicates that brokers are banned from influencing the independent judgement of appraisers when it comes to a property’s value.

SB 203 (Mortgage Broker Licensing) – says brokers must be licensed by the Division of Real Estate and must also get adequate training, testing, and receive a professional education.

SB 216 (Mortgage Loan Acts Practices) – says a mortgage broker has a statutory duty of good faith and fair dealing with a borrower to maintain.

SB 249 (Real Estate Title Escrow Settlement) – says the Division of Insurance needs to provide annual reports to specific legislative committees, and to post to its Web site, a report of the number of enforcement actions taken, as well as the market trends associated with title insurance and real estate transactions, and any consumer complaints.

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