Colorado

The relevant statute is the Uniform Consumer Credit Code, Colo. Rev. Stat. §§5-1-101 et seq. (“CO-UCCC”).

A. Actions lender may take: CO-UCCC §5-2-209 - If a lender has to pay for collateral insurance required in a non-purchase money mortgage loan agreement subject to CO-UCCC, the lender may add the amounts paid for that insurance to the loan amount.

B. Notices required: CO-UCCC §5-2-209 - Before obtaining any required insurance required in a non-purchase money mortgage loan agreement subject to CO-UCCC, the lender must mail written notice of non-performance to the borrower's last known address and give the borrower a reasonable opportunity to obtain the required insurance. After obtaining any required insurance, the lender must give the borrower a written statement describing the sums advanced, any charges with respect to that amount, any revised payment schedule, and the kind of insurance paid for by the lender (including a description of the type and amount of coverages).

C. Coverage required: No express statutory provision.

D. Charges permitted: CO-UCCC §5-2-209 - The lender may make reasonable expenditures needed to protect against the risk of loss or damage to the property, if the lender makes those expenditures in good faith and in a commercially reasonable manner.

E. Finance charge allowed on lender's payment: CO-UCCC §5-2-209 -

(1) For non-purchase money mortgage loan agreements subject to the CO-UCCC, the lender may impose the finance charge previously disclosed to the borrower on the sums advanced.

(2) For revolving loan accounts, the lender may add the amount of an advance to the unpaid balance and impose a finance charge up to the amount permitted for consumer credit transactions (CO-UCCC §5-3-101).

Click here to view relevant Colorado Code and Regulations.