People in Colorado, like many across the United States, have come face-to-face with the prospect of losing their homes to foreclosure. Two bills now pending in the Colorado State Legislature are designed to alleviate some of the tensions faced by those for whom foreclosure seems a real possibility.

Currently in Colorado, about one of every five homes is underwater, meaning the homeowners owe more on their mortgages than the property is worth. If conditions don't improve markedly in the next few years, more and more homeowners will find themselves on the verge of foreclosure.

The first of the two bills being introduced would require a bank to provide evidence that they have the right to foreclose on a property. The legislator behind the bill says right now, attorneys for mortgage companies can merely show a document that says they can foreclose because they say so. If the bill were to become law, it would increase the burden on the bank to bring the proof of their ability to foreclose to court.

The second bill would provide Colorado homeowners options such as loan modifications in an effort to stave off the foreclosure process. The bill would oblige banks to provide homeowners information about their eligibility for a loan modification, and if they deny a modification, to fully disclose the reasons.

Although these changes to the law would be helpful, they would not take effect for quite a while even if approved. Even so, there are options available right now for distressed homeowners. An attorney experienced in personal bankruptcy and home ownership issues can often provide much-needed assistance.

Source: CBS Denver, "Bill Designed To Help Homeowners Facing Foreclosure In Colorado," Jan. 22, 2012