I recently read an article (provided by Land Title) that discussed alternatives to foreclosure, and thought it might be helpful information for those in a financial crisis. The most important point is that homeowners should be PROACTIVE in corresponding with the lender, and looking into other options, PRIOR to reaching foreclosure (as well as discussing the issues with their accountant and/or attorney) ... many alternatives are actually available, as long as you deal with the situation early on.
For example: The lender may be willing to work out a repayment plan for missed payments (Repayment Plan). The lender might reduce or suspend mortgage payments for a period of time (Forbearance). Or the loan could be permanently changed in regards to interest rate or term (Loan Modification).
Other options might include sale of the property and repayment of the loan upon sale; a 'Short Sale' (in which the lender agrees to accept less than the existing loan balance); a 'Deed-In-Lieu' situation, in which the homeowner voluntarily transfers title to the lender in exchange for cancellation of the loan; or personal bankruptcy.
For free assistance in Colorado:
1-877-601-HOPE
http://www.coloradoforeclosurehotline.org
And let me know if you need additional information or have questions!!
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