Escrow & Title
In Colorado, a 'deed in lieu of foreclosure' is when:
AA. The lender forecloses on the property through court action
BB. The borrower voluntarily conveys the property to the lender to avoid the foreclosure process✓ Correct
CC. A third party purchases the property at a foreclosure sale
DD. The borrower refinances to avoid foreclosure
Explanation
In a deed in lieu of foreclosure, the borrower voluntarily deeds the property back to the lender in exchange for cancellation of the mortgage debt. This avoids the formal foreclosure process.
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