Ritter signs 5 bills meant to rein in mortgage brokers

DENVER - Colorado’s eye-popping foreclosure rate remains on the rise, but Gov. Bill Ritter signed five bills into law Friday that he thinks will keep more people in their homes.

The measures do not take drastic steps to ban foreclosures as other states have considered. Rather, they attack the increasingly common practice of unscrupulous mortgage brokers hawking loans that consumers can’t afford and then foreclosing on them when they aren’t paid off.

Colorado ranked second in the nation in foreclosures in 2006, according to RealtyTrac, a California agency that tracks foreclosures. After rising about 30 percent in 2005, foreclosures are on pace to rise another 30 percent this year, which could result in 37,000 more foreclosures, Ritter told a crowd at a Denver redevelopment company that runs the Colorado Foreclosure Hotline.

“This is the most comprehensive package of foreclosure-prevention and mortgage-fraud prevention laws in the country,” said Rep. Rosemary Marshall, a Denver Democrat who sponsored three of the five measures.

Attorney General John Suthers, who worked with legislators to write the bills, called the package “a significant step toward protecting the integrity of the American dream for Coloradans.”

CONTACT THE WRITER: (303) 837-0613 or ed.sealover@gazette.com.

NEW LAWS

House Bill 1322: Further regulates mortgage brokers by requiring them to find a loan that takes the borrower’s financial situation into consideration, among other things.

Senate Bill 85: Prohibits brokers from trying to influence the judgment of a real estate appraiser through coercion, intimidation or compensation.

Senate Bill 203: Requires brokers to be licensed and prohibits them from engaging in activities such as misrepresentation, fraud and conflicts of interest.

Senate Bill 216: Makes a broker’s violation of good-faith dealings with a borrower a deceptive trade practice under the Colorado Consumer Protection Act.

Senate Bill 249: Requires that the Division of Insurance post on its Web site a statistical report that includes the number of complaints and enforcement actions taken.