Selling a House in Colorado

Selling a house is one of the most significant legal transactions you'll ever participate in. It's important to know your legal rights and understand the process.

Working With a Real Estate Agent

In Colorado, real estate agents have what's called a "fiduciary duty" to the home seller, in instances in which they represent the seller, and not the buyer. In Colorado, this means that the agents are held by law to owe specific duties to the person who they are representing, in this case the seller. In addition to duties or obligations that are stated in a listing agreement or other contract, a fiduciary's duties include:

• Loyalty
• Obedience
• Disclosure
• Confidentiality
• Reasonable care and diligence
• Accounting

You should disclose the following potential house defects (Colorado's Real Estate Commission offers standardized property disclosure forms):

• Plumbing and sewage problems
• Water leakage of any type, including in basements
• Termites or other infestations
• Roof defects
• Heating or air conditioning system, electrical or other mechanical system problems
• Property drainage problems
• Foundation instabilities or cracks and other structural problems
• Problems with title to the property
• Neighbor issues that aren't obvious
• Environmental conditions such as hazardous materials located on the property
• Whether a methamphetamine lab was located on the property, and that remediation cleanup has not occured
• Whether property is part of a homeowners' association
• Designate the water source for the property
• Lead paint (required under the federal Residential Lead-Based Paint Hazard Reduction Act of 1992 for homes built prior to 1978)

Sales Contract

When you've got a serious buyer, you'll receive a written offer to purchase your home, sometimes called a " sales contract," which states the finalized terms and conditions for the transfer of real estate.

You won't have very long to decide whether or not to take the offer or propose a counteroffer so it's important to be informed ahead of time.

Common counter-proposal items include:

• A higher purchase price
• A higher deposit
• Giving buyer less time to remove contingencies
• Excluding certain items from the sale
• Providing you move in time to vacate the house after the sale is closed
• A clause making it a contingency that your attorney approve the contract
• A "liquidated damages clause" that details how much money the buyer will owe you if the buyer backs out of the deal for reasons other than the contingencies listed in the contract

Legal Title Issues

Your Colorado real estate lawyer or title company will investigate the legal title of the property you want to sell, and may find issues you'll need to understand.

In Colorado, for example, an implied easement may be present where a person grants lands to which there is no accessible right-of-way except over her or his land or retains land that is inaccessible except over the land which the person conveys. In such instances a right-of-way is presumed to have been granted or reserved. Such an implied grant or easement in lands or estates exists where there is no other reasonable and practicable way of accessing the property, and it is reasonably necessary for the beneficial use or enjoyment of the part granted or reserved.

Your property may also be subject to a "lien," which is a charge on the property to satisfy a debt or other obligation. A lien encumbers property as long as it exists and has been recorded in the public records.

In Colorado, liens on a piece of property may include:

• Mortgage or trust deed liens
• Construction or mechanics' liens
• Tax liens
• Municipal liens
• Judgment liens

Closing Costs

In Colorado, you can expect to pay for some or all of the following charges - called " closing costs"- at the time you sell your home:

• Lender's title insurance
• Real estate closing fees (normally split 50/50 between buyer and seller)
• Broker's commission
• Survey
• Title insurance
• Recorded release of mortgage
• Transfer taxes
• Attorney's fee
• Home inspections

Specific Performance

In Colorado, a seller who agrees to sell a particular property must do so unless the buyer fails to meet all the terms of the purchase agreement. This is called "specific performance," which is a legal action to compel performance of a contract. For this contract remedy, a court can order the parties to complete the contract. The buyer must then deliver the purchase price and the seller must then deliver the deed. If you have second thoughts on a particular sale, you'll want to immediately contact an attorney.