Colorado Real Estate Purchase Agreement

Legal Aspects

Writing Requirement

• When drafting a Colorado contract, you must ensure you satisfy these four (4) conditions: Identification and contact information of the parties, i.e., seller and buyer.

• Property’s legal description and registered address.

• The parties’ previously agreed-upon purchase price for the property.

• The transfer’s closing date (generally within four (4) to six (6) weeks) and the title’s transfer method.

• Other crucial terms to include are: To define deadlines for events like home inspections.

• The Earnest Money Deposit is typically between 1% and 5% of the purchase price.

• State the inspections as required by the mandatory disclosures before signing the agreement.

• Financing requirements and contingencies if those requirements aren’t met.

• Both parties must mutually consent to the contract’s terms and add their signatures.

• Colorado’s Real Estate Commission provides a standard purchase agreement format. However, you can use other templates as well. As such, it’s always important to keep yourself updated on the legal aspects of this contract.

Required Disclosures

There are eight (8) required disclosures in Colorado. However, sellers should be aware that not all of them are mandatory with each sale. You should check whether your property requires you to add all or only some of the disclosures below:

• Seller’s Property Disclosure:Sellers must notify the buyer of any property issues. This includes any problems that can negatively affect people’s health or safety. The same applies if that issue brings down the property’s market value.

• Green Disclosure Form: Say the seller adds any alternative energy systems or additions or is aware of any energy-related issues. This clause states they must disclose it to the buyer.

• Portable Water Disclosure: Sellers must state the source of the property’s water.

• Methamphetamine Lab Disclosure: Sellers must state whether the property was previously used to produce meth.

• Transportation Projects Disclosure: Complete this form if transportation projects affect the property. It’s also required if it has the chance to influence the property.

• Special Taxing District: The seller must state whether the property is in a special taxing district.

• Common Interest Community: Sellers must tell buyers if the property is in a common interest community.

• Lead-Based Paint: This clause only applies if the property was built in or before 1978. The seller must state whether lead-based paint is present.