Colorado Homeowner Files Federal Suit Challenging Constitutionality Of State's Foreclosure Process & Law

In Denver, Colorado, The Denver Post reports:

• Denver attorney John Prater sued the state of Colorado in federal court Friday, alleging that it is allowing lenders to seize properties without the due process required under the U.S. Constitution. "Colorado's foreclosure process and law are unconstitutional," said Andrew O'Connor with the Prater Legal Offices.

• He said borrowers aren't getting a fair hearing under the state's current system of public trustees and limited "Rule 120" court hearings. Prater is fighting a foreclosure on his Douglas County home and filed a federal lawsuit after failing to get the hearing he wanted in state courts.

• Under Colorado's current system, lenders can foreclose even if a fraudulent origination contributed to the delinquency. They can foreclose even while promising a loan modification that never gets fulfilled. And they can foreclose without ever providing proof before a judge that they have clear legal standing to do so, O'Connor said.

• He said Colorado serves a lender's interest by having judges in Rule 120 hearings address only two issues: Is a borrower in the active military, which allows special consideration, or are they delinquent?

For more, see State's foreclosure rules challenged (Borrowers say they don't get a fair hearing from public trustees and limited court hearings).