Colorado Eyes Mortgage Regulation

Mortgage brokers in Colorado have been largely unregulated by the state government. As more fraud allegations come to light nationally, though, state legislation may soon change. The new Act will keep tabs on mortgage brokers through requirements such as finger printing, background checks, registration and bonding. It has been noted by the state that brokers are the only part of the mortgage process that are not regulated, causing an area that can become riddled with fraud.

The legislation has been in the works for almost a decade. The proverbial straw was when Colorado was listed fifth in the nation for foreclosures, with some counties up 30% in the first three months of 2006 compared to the previous year. When the market was booming in the 90’s many people bought multiple properties or refinanced to adjustable mortgages. Both are now putting borrowers in jeopardy of foreclosure and some brokers are resorting to unethical, or flat out illegal, measures to compensate for the cooling market. The bill would regulate more than 240 firms throughout the state.