Senate Bill Addresses Junior Liens
On January 20th, Senate Bill 93 was introduced in the Colorado General Assembly by Senator Lundberg. This bill would require all junior lienors to accept tender of payment of the junior lien amount from the purchaser of the property at a public trustee foreclosure sale. In the association context, if a purchaser tenders payment to an association to satisfy the association's lien - that payment must be accepted, would extinguish the association's lien and eliminate the association's right to redeem the property or assign the lien.
Under the current version of the legislation, associations are required to:
- Submit with the notice of intent to redeem, a signed statement of the amount payable to the association on the association's lien;
- Accept payment of the lien amount which is tendered by the purchaser within 10 business days following the public trustee foreclosure sale;
- Execute a release of lien upon receiving tender of payment.
This bill, as currently written, would likely impact the feasibility and time-frames of associations assigning their lien rights to investors.
We will keep you updated on the status of SB 93 as it progresses through the legislative process.