When a house sells at the Denver Public Trustee’s auction, the highest bid may be greater than what is owed. This difference—referred to as excess funds—may belong to you.
Colorado revised statute (38-38-111) states that excess funds must be distributed in the following order:
1. Foreclosing lender to satisfy any outstanding debt
2. Junior lien holders who file an Intent to Redeem, but do not redeem, to satisfy the amount of the lien
3. Foreclosed-upon homeowner
Excess funds are held for six months from the sale of the property. If the proceeds are not claimed within six months, the excess funds are transferred to The Great Colorado Payback. The Great Colorado Payback holds unclaimed property until the rightful owner(s) or heirs claim it.
If the borrower believes that a lender or servicer has violated the requirements for a single point of contact in section 38-38-103.1 or the prohibition on dual tracking in section 38-38-103.2, the borrower may file a complaint with the Colorado Attorney General, the Federal Consumer Financial Protection Bureau (CFPB), or both. The filing of a complaint will not stop the foreclosure process.