Pre-Foreclosure: Advice for approaching the owners

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I went to my first auction. Learned lots. I have my eyes on some properties scheduled for auction. I’d love to hear ideas regarding what you have done that *was* or *was not* successful in approaching owners before their property goes up for auction. Forget it and wait for the auction, or.........?

I'd be very careful so you don't get accused of acting in the capacity of a foreclosure avoidance consultant, that may or may not require licensure/registration. You may or may not also subject yourself to allegations of criminal activity for equity skimming or elder abuse if the situation arises. Doesn't matter your intent if someone makes the allegation, you're gonna have to defend it.

I'd start by reading: 

Colorado Foreclosure Protection Act revised statutes 6-1-1101 (Assuming you are talking about Colorado)

You do have to be careful with where the property is in the foreclosure process. Colorado does have pretty specific laws set out in the Foreclosure Protection Act. - Good read by a Colorado expert

Even if you get the homeowner on board, there are some things that they will have to do in short order. Most importantly, you'll need the owner to provide a written intent to cure to the county trustee and get them to make a request of the lien holder to stop the proceedings at least 15 days prior to the sale. If the homeowner has already done this once, it will go to auction. Arapahoe County her in Colorado does a pretty good job of outlining the details.

The pandemic has introduced a whole new set of rules on foreclosures and evictions, including a moratorium on foreclosures through the end of the year. The rules are different if the notice was filed with the county prior to Covid guidelines going into effect. Bottom line, make sure you do your research before going in the door about what kind of loan it is, when the proceedings started and who the mortgage holder is.

I have been successful in the past at knocking on doors, but with COVID-19, I'm not sure that will work. In lieu of talking with someone directly, I have a flyer that I'll place under the doormat when no one answers. Calls always get ignored, so I use them as a follow up to dropping off a flyer at the front door. 

Any way you approach it, you have to present yourself as a compassionate problem solver, not charging a fee. Expect to get told no, a lot. These folks have been approached a lot by now by people promising to get them out of trouble.

Regardless of how you proceed, it is always good to have a local real estate lawyer on speed dial.