“If there is anything that is most important in the rules of civil procedure, this is it,” Colorado Court of Appeals Judge Michael Berger said. Years of changes to the Rule 120 process had turned it into “a mess,” he said.
Berger noted how 97 percent of contested Rule 120s were homeowners representing themselves.
“That says we need a rule that is clearly understood by the ordinary person,” he said.
More than 195,000 Colorado homes were auctioned in county foreclosure sales from 2003-2015, record show.
Rule changes suggested by a 10-member panel were recommended by the court’s committee on civil rules, which Berger chairs.
Problems have included homeowners unaware they needed to respond to the foreclosure in writing before heading to court, only to arrive and find no one there.
“I have seen as many as 15 people a day appear in court only to be shown the door,” said Keith Gantenbein, an attorney who once handled foreclosures and now represents homeowners. “The existing rule is simply too confusing and is fundamentally broken. The changes are to honor the intent of due process.”
Homeowners facing foreclosure have said they felt helpless in a Rule 120 hearing that only determined whether they were in default and that they were not in the active military. Other rights, such as whether the bank actually holds the mortgage, depended on which courtroom you happened to be in, Gantenbein said.
Bankers and lenders, however, aren’t convinced there is a problem, said attorney Dan Delaney, who noted that two legislative efforts to address the issue failed in the past few years.
“The vast majority of foreclosures are not contested,” Delaney said on behalf of several groups including the Colorado Bankers Association and the Colorado Mortgage Brokers Association. “This is a system that is not broken. The rule requires no change.”
There is no timeline for when the court will decide whether to accept the proposed changes or not.