Colorado at a glance
Checked against the sources cited, 2026-09-19
| Topic | What the law says, and where it says it |
|---|---|
| How foreclosure works here | In Colorado a deed of trust is foreclosed through the county public trustee, and the lender must first get a court order authorizing the sale. The statute also covers foreclosures carried out through a court case, where the sheriff conducts the sale. C.R.S. § 38-38-105(2)(a); C.R.S. § 38-38-100.3(13), (17); C.R.S. § 38-38-101(1) Show the source textwhenever a public trustee forecloses upon a deed of trust under this article, the holder of the evidence of debt or the attorney for the holder shall obtain an order authorizing sale from a court of competent jurisdiction |
| Who holds foreclosure surplus | After a public trustee sale, the overbid is paid to the public trustee and held in escrow until all redemption periods end. It is then paid, in order of recording priority, to junior lienholders who filed a notice of intent to redeem, and whatever remains is paid to the borrower. When the sheriff sells the property, all of the sale proceeds are deposited into the registry of the court. C.R.S. § 38-38-111(1), (2), (3)(a)(I) Show the source textAn overbid shall be first applied to any deficiency as indicated in the holder's bid, and then paid to the officer to be held in escrow until the end of all redemption periods as provided in section 38-38-302. |
| Claim window for foreclosure surplus | Under the statute as amended effective July 1, 2026, an unclaimed overbid of $25 or more that is not claimed within two years from the date of the sale is transferred to the state treasurer as unclaimed property. An unclaimed overbid under $25 goes to the county general fund after six months. Before the 2026 amendment the window for amounts of $25 or more was six months. C.R.S. § 38-38-111(3)(a)(II), as amended by H.B. 26-1098 (L. 2026, ch. 90, § 9, effective July 1, 2026); C.R.S. § 38-13-214 Show the source textUnclaimed remaining overbids that are equal to or greater than twenty-five dollars and that are not claimed within two years from the date of the sale shall be transferred to the state treasurer |
| Tax sale excess proceeds | Colorado is a tax lien state: the county treasurer sells a tax lien, not the property. After August 1 of the third calendar year following the tax lien sale, the lien holder may apply for a treasurer's deed, which leads to a public auction. Any overbid from that auction is paid first to junior lienholders who file a claim and then to the property owner. The county treasurer holds an unclaimed overbid in escrow for two years from the date of the auction; after that, amounts of $25 or more may be transferred to the state treasurer as unclaimed property. C.R.S. § 39-11.5-112(1), (3)(a); C.R.S. § 39-11.5-102(1); C.R.S. § 39-11-115(1) (article 11.5 repealed and reenacted by S.B. 26-144, L. 2026, ch. 135, effective June 1, 2026) Show the source textThe treasurer shall hold any unclaimed remaining overbid from a public auction in escrow for two years from the date of the public auction. |
| Redemption after the sale | Colorado's foreclosure statute gives the right to redeem after the sale to junior lienholders who file a notice of intent to redeem, generally within eight business days after the sale. Its redemption part does not list the former owner as a person who may redeem after a deed of trust foreclosure sale; the owner's right under the statute is to cure the default before the sale. In a foreclosure of a homeowners' association lien, the unit owner is treated as an alternate lienor who may redeem. C.R.S. § 38-38-302(1); C.R.S. § 38-38-501(1); C.R.S. § 38-38-305.5(1)(a)(I); C.R.S. § 38-38-104(1) Show the source textA lienor or assignee of a lien is entitled to redeem if the following requirements are met to the satisfaction of the officer |
| Rules for recovery companies | Colorado restricts paid overbid recovery at every stage. While a foreclosure overbid is still with the public trustee, an agreement to pay someone to recover it is not enforceable, and inducing or trying to induce a person to sign one is a class 2 misdemeanor. After the overbid has been transferred to the state treasurer, a recovery agreement is not enforceable unless it is entered into at least two years after the transfer, is in writing and signed by the owner, describes the property, the sale date and the services, tells the owner they can claim directly from the state treasurer without a fee, and charges no more than 10 percent of the overbid; inducing a non-complying agreement is also a class 2 misdemeanor. For an overbid from a treasurer's deed (tax) auction, a recovery agreement is enforceable if the fee is no more than 10 percent and it is entered into at least two years after the transfer. For other property held by the state treasurer, an agreement made within 24 months after the property was delivered to the treasurer is void, and the Treasury's rule caps compensation at 10 percent. C.R.S. § 38-38-111(2.5)(c); C.R.S. § 38-13-1304; C.R.S. § 39-11.5-112(2)(c); C.R.S. §§ 38-13-1301, 38-13-1302; 8 CCR 1508-1, Rule 1.5.11 Show the source textAn agreement to pay compensation to recover or assist in recovering an amount due to the borrower from the public trustee under subsection (2) of this section is not enforceable. |
How surplus funds arise in Colorado
When a home in Colorado is sold at a foreclosure sale or a tax sale for more than the debt and the costs of the sale, the money left over is surplus funds, also called excess proceeds or overage. It does not belong to the lender or to the buyer. Liens recorded behind the foreclosed debt are paid first, and what remains belongs to the former owner or to the owner's heirs. Read surplus funds explained for the general rules and liens and competing claims for the order of payment.
How a claim moves in Colorado
We confirm the sale figures in the public record, identify which office in Colorado is holding the money, and prepare and file the claim the way that office requires, advancing the costs. Because we bring the whole record with us, the claim does not stall on a missing document, a competing name or a missed date. See how to qualify for what we handle and what you provide. Notices about surplus are usually mailed to the last address on record, which is often the home that was sold, so do not wait for a letter. In Colorado that program is the The Great Colorado Payback (Colorado Department of the Treasury, Unclaimed Property Division).
If the owner has died
The right to the money belongs to the estate. Depending on the size of the estate, Colorado law may allow a simplified procedure, or a probate court may need to appoint a personal representative. See estate and heir recovery and probate assistance.
Working with a recovery company in Colorado
Colorado regulates this kind of service. Colorado restricts paid overbid recovery at every stage. While a foreclosure overbid is still with the public trustee, an agreement to pay someone to recover it is not enforceable, and inducing or trying to induce a person to sign one is a class 2 misdemeanor. After the overbid has been transferred to the state treasurer, a recovery agreement is not enforceable unless it is entered into at least two years after the transfer, is in writing and signed by the owner, describes the property, the sale date and the services, tells the owner they can claim directly from the state treasurer without a fee, and charges no more than 10 percent of the overbid; inducing a non-complying agreement is also a class 2 misdemeanor. For an overbid from a treasurer's deed (tax) auction, a recovery agreement is enforceable if the fee is no more than 10 percent and it is entered into at least two years after the transfer. For other property held by the state treasurer, an agreement made within 24 months after the property was delivered to the treasurer is void, and the Treasury's rule caps compensation at 10 percent. (C.R.S. § 38-38-111(2.5)(c); C.R.S. § 38-13-1304; C.R.S. § 39-11.5-112(2)(c); C.R.S. §§ 38-13-1301, 38-13-1302; 8 CCR 1508-1, Rule 1.5.11)
Any agreement you sign, with us or with anyone else, has to follow that rule.
No out-of-pocket expense. Our only payment is a completion fee taken from the surplus once it is recovered. Where your state requires a licensed attorney for a court or probate filing, a licensed attorney handles it, and you still pay nothing out of pocket. Before you sign with anyone, read what a surplus funds scam looks like.
Questions about surplus funds in Colorado
Enough to prove who you are and how you held the property: identification, the deeds, any notice you received, and, if the owner has died, the estate paperwork. We do the rest for Colorado, from locating the funds to filing the claim.
After a public trustee sale, the overbid is paid to the public trustee and held in escrow until all redemption periods end. It is then paid, in order of recording priority, to junior lienholders who filed a notice of intent to redeem, and whatever remains is paid to the borrower. When the sheriff sells the property, all of the sale proceeds are deposited into the registry of the court.
No out-of-pocket expense. We advance the costs and are paid a completion fee from the surplus only after it is recovered. Where a court or probate filing requires a licensed attorney, a licensed attorney handles it.