Title to the property vests with either the Certificate of Purchase holder or the final Certificate of Redemption holder on the 9th business day following the sale or the day after the last redemption period, whichever is later.
The Redemption provisions allow a junior lienholder to purchase the property either from the buyer that holds the certificate of purchase or the previous certificate of redemption holder if there is one. For all junior lienholder redemptions, the junior lienholder must have a recorded interest in the property prior to the Notice of Election and Demand recording date and must submit the original or a certified copy of the recorded lien as part of the Intent to Redeem process.
For junior lien holders, the timeframe to file Intent to Redeem with the Public Trustee begins the day after the sale for eight business days. The junior lienholder with the most senior lien may redeem beginning on the 15th business day after the sale and will have 5 business days to redeem until 12 noon on the 5th day. If there is more than one redeeming lienor, each subsequent junior lienholder with the next most senior lien will be able to redeem from the previous redeeming lienor beginning with the day after the previous redemption period and run for 5 business days for each additional lienor. There is a $50 fee to file each Intent to Redeem.
If there is an assignment, the original recorded document or certified copy of the assignment showing the transfer of the lien must be submitted.
Special Requirements for HOA Lien Holders
Douglas County requires the following documentation for all HOA lien holders wanting to redeem an HOA lien:
- Intent to redeem specifying the amount of the lien minus the senior portion plus any interest amount.
- The HOA general ledger for the property address in foreclosure.
- Copy of the first page of the HOA covenant declarations showing the recording stamp and the page regarding lien provisions.
- Recorded Lien Statement, if there is one.
If there is an Internal Revenue Service (IRS) or U.S. Government agency (i.e. Small Business Administration or U.S. Treasury) lien against the property, the agency may file an intent to redeem with the Public Trustee and must follow the junior lienholder redemption process outlined in the state statutes. In addition, under federal law, the IRS may redeem independently of Colorado law up to 120 days but the Public Trustee office is not involved in the redemption.
After an Intent to Redeem has been filed with the Public Trustee, the Certificate of Purchase holder must prepare a Redemption Statement that specifies all sums necessary to redeem including: the amount of the purchase price from the foreclosure sale, the interest rate and amount through the 19th business day post-sale, costs and expenses actually incurred which are permitted by C.R.S. 38-38-107 which usually costs to secure the property, insurance, inspections, immediate repairs, etc. with receipts or invoices evidencing the costs and expenses incurred.
The statement shall be submitted to the Public Trustee no later than 13 days after the sale. A statement may be amended no later than two business days prior to the start of the redemption payoff period.
A redeeming lienholder must present the redemption amount in cash or certified funds to the Public Trustee by the close of business before 12 noon on the final day of his redemption period. The Public Trustee cannot accept late redemption proceeds. A Certificate of Redemption is issued to the party redeeming the property from foreclosure.
Upon request, a Confirmation Deed may be issued to the holder of the Certificate of Purchase the 9th day after the sale if there are no redeemers or will be automatically issued after 10 business days following the vesting date if all foreclosure fees and costs have been paid in full. The same applies to a final redeeming lien holder. In both instances, title vests free and clear of all liens and encumbrances junior to be foreclosed lien except omitted parties – parties that were not notified of the foreclosure but who have a recorded interest in the property, C.R.S. 38-38-506.