A borrower in Larimer County, Colorado receives a Notice of Election and Demand (NED) from the Public Trustee after defaulting on her deed of trust. What is the primary purpose of the Rule 120 hearing that follows in the Colorado foreclosure process?
Correct Answer
B) To provide a limited court review confirming the lender's right to foreclose
The Rule 120 hearing under C.R.S. § 38-38-101 et seq. is a limited, expedited court proceeding — not a full trial. Its purpose is for the court to confirm that the lender has the legal right to foreclose (i.e., that the deed of trust exists, there is a default, and proper notice was given). It is a narrow review, not a full adjudication of the debt.
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Related Topics & Key Terms
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Related Concepts
RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
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