Family Can't Move Into Their Home After Squatters File for Bankruptcy

Aug. 1, 2012— -- Dayna Donovan and her family have been unable to occupy their home after two strangers squatting in her Littleton, Colo., home for eight months have filed for bankruptcy, preventing an eviction from the sheriff's department.

On July 12, a judge in Arapahoe County ruled that Veronica Fernandez-Beleta and Jose Rafael Leyva-Caraveo, the two people who were living in the home, had to move out in 48 hours.

Troy Donovan, 45, filed for a forced eviction with the Arapahoe County Sheriff's office on July 16.

However, Fernandez-Beleta filed for bankruptcy on July 20, which the Donovans learned about just hours before the scheduled eviction was to take place last week.

"The sheriff's office will not proceed with an eviction if there is a bankruptcy in question," Arapahoe County Undersheriff David Walcher told a local CBS television station.

"It's frustrating. It's just one thing after another, after another," Donovan told ABC News. "We've lost two months' time. It has been an absolute living nightmare and an emotional roller coaster."

The Donovans and their two young daughters have been staying in the basement of a relative's house in Greeley, about 65 miles away. They say they can't afford an attorney and have struggled to come up with $500 in court filing fees and gas for driving to the clerk's office throughout the legal process.

Donovan said she delayed starting working a temporary job near her home in Littleton just because of the complications from the delayed eviction. She and her husband have struggled to find jobs in the small town where they are staying temporarily. They are also dealing with their mortgage company, because they are about $20,000 behind on their house payments, the last of which was made in June 2011.

Donovan's brother in law set up a website asking for donations to allow them to move into a temporary home.

She has been contacting lawyers with the Colorado Legal Services who have so far said they are unfamiliar with this area of the law.

Fernandez-Beleta and Levya-Caraveo could not be reached for comment. Their attorney, Douglas Romero, of the Colorado Christian Defense Counsel, couldn't be reached for comment.

It all started last August when the Donovans moved to Indiana with their two children. Both were unemployed at the time and two months behind on their mortgage payments. They decided to relocate because Troy had a temporary job with a race team. Donovan said she left their home of more than 13 years locked and ready for the cold Colorado winter.

In March, Donovan said she had a "premonition" something was wrong with the home. She and her husband called a neighbor and learned someone had been living there since the winter.

When the couple called the police to check up on the home, the two occupiers showed paperwork from the Arapahoe County Clerk and Recorder with an affidavit of "adverse possession," their names and the Donovan's address written on it. The two claimed they bought the home from a real estate agent for $5,000.

"I am sad and confused and distressed," Fernandez-Beleta told Denver station CBS4 in Spanish.

The law of adverse possession varies from state to state. In Colorado, adverse possessors who stake their claim to a piece of land for 18 years without dispute may be able to become owners of it, according to Willis Carpenter, a real estate attorney in Denver who is not involved in the case.

Since the recession, reports of squatters staking their claim to a foreclosed or abandoned home flooded headlines, and instructional guides popped up online about how to file paperwork for adverse possessions.

Carpenter said the police won't usually get involved because it's a civil, not a criminal matter. However, Donovan and her husband were ordered to stay 100 yards away from their home after Fernandez-Beleta and Levya-Caraveo requested temporary restraining orders. The orders were issued on July 3.

Carpenter said the real estate agent who sold the home for $5,000 defrauded the buyers.

"Anybody that told Fernandez-Beleta and Levya-Caraveo they could have that home for $5,000 by adverse possession, that's obviously fraud," he said.

The minimum amount of time for an adverse possessor to have legal ownership of a home can be shortened to seven years, if the occupier has a deed to the property and has been paying property taxes.

Most states have at least a five-year requirement for adverse possession, said Carpenter.

"Many states require 20 years or somewhere in between," Carpenter said, adding that most people use the law to claim a strip of land or a field, say, in dispute with a neighbor.

"It sounds like none of this comes close to that," Geoffrey Anderson, a real estate attorney in Denver not involved in the case, said of the people occupying the Donovan's home.

Donovan said she suspects a real estate agent targeted her home because it was briefly on the market last year.

"People who are even on an extended vacation need to be aware of this situation because once someone illegally occupies your home, you can't just have the cops arrest them," because they need to be caught in the act of breaking in and entering, Donovan said.

"It's just been a nightmare," she said. "We just want to get settled and try to get on with our life."