§ 12-10-725, C.R.S. Written Disclosure of Fees and Costs +22Colorado · Real Estate · English

An MLO's disclosures must comply with all applicable requirements of TILA/Regulation Z, RESPA/Regulation X, ECOA/Regulation B, Gramm-Leach-Bliley, HMDA/Regulation C, the FTC Act, and the Telemarketing and Consumer Fraud Act. The board may require additional disclosures by rule.

• ✓Disclosures must comply with TILA/Regulation Z and RESPA/Regulation X
• ✓Disclosures must comply with ECOA/Regulation B and Gramm-Leach-Bliley
• ✓Board may require additional disclosure requirements by rule

Except as provided otherwise, the association maintains common elements and each unit owner maintains their own unit. Owners must afford access for maintenance purposes, and responsible parties are liable for prompt repair costs.

• ✓The association is responsible for maintenance, repair, and replacement of common elements; owners maintain their own units
• ✓Unit owners must afford access through their units reasonably necessary for maintenance
• ✓The party responsible for damage during access is liable for the cost of prompt repair

The declarant alone is liable for all expenses connected to real estate subject to development rights. If the declarant fails to pay, the association may pay and assess those expenses as a common expense against that real estate.

• ✓The declarant alone is liable for all expenses of real estate subject to development rights
• ✓If declarant fails to pay, the association may pay and assess as a common expense against the development real estate
• ✓Development rights are not extinguished if the association acquires the real estate through foreclosure

Except as provided in 12-10-607(9), it is unlawful to engage in appraisal management without a license. The Board may apply for a court injunction against violations regardless of other remedies. Operating as an unlicensed AMC, or during suspension/revocation, is a class 2 misdemeanor.

• ✓Engaging in appraisal management without a license is unlawful
• ✓The Board may seek an injunction regardless of other remedies
• ✓Unlicensed AMC operation is a class 2 misdemeanor

An MLO cannot receive a fee/commission unless the borrower actually obtains a loan on agreed terms. Exceptions: if a written commitment was obtained and the borrower fails to close through no fault of the MLO, up to $300 may be charged for documents/services; third-party fees may be collected in advance but must be refunded if services are not provided.

• ✓No fee unless borrower actually obtains a loan on agreed terms
• ✓Up to $300 chargeable if borrower fails to close on a written commitment through no fault of MLO
• ✓Third-party fees collected in advance must be refunded if services not provided
• ✓MLO cannot charge more than the actual third-party cost

Owner meetings must be held at least annually. Notice must be delivered 10 to 50 days in advance, physically posted where feasible, and state the time, place, and agenda items including proposed amendments, budget changes, and officer removals.

• ✓Owner meetings must be held at least once each year
• ✓Notice must be given not less than 10 nor more than 50 days in advance
• ✓Special meetings may be called by the president, a majority of the board, or 20% of the votes in the association

All regular and special board meetings and committee meetings must be open to members. Executive sessions are limited to specific matters like employee issues, legal consultation, criminal misconduct, and privacy matters. No rules may be adopted in executive session.

• ✓All regular and special board and committee meetings must be open to members or their representatives
• ✓Executive sessions are limited to enumerated matters such as personnel, legal counsel, and individual privacy issues
• ✓No rule or regulation may be adopted during an executive session; owners must be allowed to speak before board votes

The Board, through the attorney general, may apply for an injunction to perpetually enjoin a person or AMC from committing prohibited acts. Injunctive proceedings are in addition to other remedies. The Board need not prove that an adequate remedy at law does not exist or that irreparable damage would result.

• ✓The Board may seek injunctions through the attorney general
• ✓Injunctive proceedings are in addition to other remedies
• ✓The Board need not prove inadequate legal remedy or irreparable damage

Privacy, confidentiality, and privilege protections apply to information provided to NMLS even after disclosure. Information may be shared with state/federal regulators with mortgage oversight authority without losing protections. It is not subject to public disclosure laws or subpoena/discovery unless privilege is waived.

• ✓Confidentiality and privilege continue after disclosure to NMLS
• ✓Information may be shared with regulators without loss of privilege
• ✓Not subject to public disclosure laws or subpoena unless privilege is waived

Unless bylaws provide otherwise, an association meeting quorum is 20% of votes (10% for associations over 1,000 owners). An executive board quorum is 50% of the votes on that board unless bylaws specify a larger percentage.

• ✓Association meeting quorum is 20% of votes, or 10% for associations over 1,000 unit owners
• ✓Executive board quorum is 50% of the board's votes unless bylaws specify larger
• ✓Quorum is measured at the beginning of the meeting

Votes for contested board positions must be by secret ballot, counted by a neutral party or volunteers. Proxies must be duly executed, are void if undated or revocable without notice, and terminate 11 months after their date.

• ✓Votes for contested board positions must be taken by secret ballot
• ✓A proxy is void if not dated or purporting to be revocable without notice, and terminates 11 months after its date
• ✓No votes allocated to a unit owned by the association may be cast

Unless a federal waiver is granted, a person acting as a real estate appraiser must be licensed or certified. An appraiser employee of a county assessor employed to appraise real property must be licensed or certified and has two years from taking office or beginning employment to comply.

• ✓No person may practice or hold out as an appraiser without a license
• ✓County assessor appraiser employees have two years to comply with licensing

The board may require licensees/registrants to submit mortgage call reports to NMLS and may report violations/enforcement actions. Each licensed/registered person must clearly show the unique identifier on all residential loan application forms and specified documents.

• ✓Board may require submission of mortgage call reports to NMLS
• ✓Unique identifier must be shown clearly on all residential loan application forms
• ✓Board may report violations and enforcement actions to NMLS

Part 7 is repealed effective September 1, 2029, subject to review under section 24-34-104, including analysis of complaints and whether licensing/registration correlates with public protection from fraud.

• ✓Part 7 is repealed effective September 1, 2029
• ✓Program is subject to sunset review under section 24-34-104

Fees paid to a mortgage broker conditioned on loan consummation (other than actual costs/expenses) must be held in an escrow/trustee account with a Colorado bank/depository. Misappropriation is unlawful and constitutes theft under section 18-4-401.

• ✓Conditional broker fees must be held in an escrow/trustee account with a Colorado depository
• ✓Misappropriation of escrowed funds is unlawful and constitutes theft
• ✓Premature withdrawal/conversion is prima facie evidence of intent to misappropriate
• ✓Violator liable for $1,000 plus actual damages, costs, and attorney fees

Neither the association nor unit owners (except the declarant) are liable for the declarant's acts on common elements it maintains. Actions alleging association acts must be brought against the association, not individual owners.

• ✓Actions alleging association acts must be brought against the association, not individual unit owners
• ✓The declarant is liable to the association for tort losses not covered by insurance during declarant control
• ✓The declarant is liable for association funds collected during declarant control that were not properly expended

Section 7-128-501 governs board member conflicts of interest, with defined terms applying the corporate conflict rules to the association, its board members (directors), and officers including managing agents.

• ✓Section 7-128-501 conflict of interest standards apply to executive board members
• ✓'Officer' includes managing agents, attorneys, or accountants employed by the board

The Board must transmit a roster of licensed individuals and AMCs to the ASC at least annually, collect and transmit an annual registry fee to the FFIEC, and conduct business consistent with Title XI of FIRREA. The Board shall NOT collect or transmit this information for licensed ad valorem appraisers.

• ✓The Board must transmit a roster to the ASC at least annually
• ✓The Board collects and transmits an annual federal registry fee
• ✓Ad valorem appraisers are excluded from federal registry requirements

Common elements may be conveyed or subjected to a security interest only if owners holding at least 67% of votes (including 67% of non-declarant votes) agree; all owners of a limited common element must agree to convey it. Proceeds are an association asset.

• ✓Conveyance/encumbrance of common elements requires at least 67% of votes including 67% of non-declarant votes
• ✓All owners of a limited common element must agree to convey it or subject it to a security interest
• ✓Any grant or deed executed by the association must be recorded in every county and is effective only upon recordation

A corporation, partnership, bank, savings association, credit union, or other business entity may provide appraisal services if the appraisal is prepared by a certified general, certified residential, or licensed appraiser. An unlicensed individual may assist only under the direct supervision of a certified/licensed appraiser and if the final document is approved and signed by a certified/licensed appraiser.

• ✓Appraisals must be prepared by a certified general, certified residential, or licensed appraiser
• ✓An unlicensed assistant must work under direct supervision of a licensed appraiser
• ✓The final appraisal must be approved and signed by a certified or licensed appraiser

Servicers must promptly credit received payments. Within 20 days of transferring servicing rights, the transferor must mail notice with the transferee's name, address, and phone. Debtors may continue paying the transferor until notice from the transferee is received.

• ✓Servicer must promptly credit all received payments
• ✓Transferor must mail transfer notice within 20 days with transferee's contact info
• ✓Debtor may pay transferor until receiving notice from the transferee
• ✓Transferor must forward payments received after transfer to the transferee

Servicers must respond in writing within 20 days to written requests for readily available loan information, provide an annual activity summary (principal and interest paid), and are liable for tax interest/late fees if escrowed tax funds were not timely remitted.

• ✓Servicer must respond in writing within 20 days to written information requests
• ✓Servicer must provide an annual summary of principal and interest paid
• ✓Servicer liable for tax interest/late fees if escrowed funds not remitted when due

A successor servicer must honor a borrower's acceptance (before transfer) of any modification offer made by the holder/prior servicer. The transferor must disclose pending modifications, and the transfer contract must obligate the successor to continue processing modifications and honor trial/permanent agreements.

• ✓Successor servicer must honor borrower's pre-transfer acceptance of a modification offer
• ✓Transferor must disclose whether a loan modification is pending
• ✓Transfer contract must obligate successor to process pending modification requests
• ✓Successor must honor trial and permanent modification agreements of prior servicer

If any provision of part 6 is found not to comply with FIRREA, it is null and void, but remaining provisions remain valid unless incapable of execution. If AMC regulation is repealed from Title XI of FIRREA, the Board's jurisdiction over AMCs is also repealed after division review.

• ✓A provision not complying with FIRREA is null and void
• ✓Remaining provisions remain valid unless incapable of execution
• ✓If AMC regulation is repealed federally, Board jurisdiction over AMCs is also repealed

Article 10 does not apply to an appraisal for a real-estate-related transaction excepted from federal appraisal regulations if performed by a financial institution officer/employee/agent or a licensed real estate broker under contract. Such appraisals cannot be represented as appraisals except to the institution, its regulators, and secondary markets, and must contain written notice the preparer is not licensed.

• ✓The exemption applies only to transactions excepted from federal appraisal regulations
• ✓Appraisals must include written notice the preparer is not licensed
• ✓Federal or state regulators may still require appraisals from financial institutions

A debtor/borrower aggrieved by a violation of section 38-40-103, 103.5, or 106 that is not remedied may bring a court action after a good-faith resolution effort. If actual damages are found, the court awards actual damages plus $1,000, costs, and attorney fees. A transferee is not liable for the transferor's acts/omissions.

• ✓Borrower may sue for unremedied violations after a good-faith resolution effort
• ✓Court awards actual damages plus $1,000, costs, and reasonable attorney fees
• ✓A transferee is not liable for the transferor's acts or omissions

Brokers, originators, lenders, applicants, appraisers, and closing agents are prohibited from false advertising of loan terms, making false promises/misrepresentations or concealing material facts, presenting fraudulent statements, or facilitating unconscionable mortgage agreements. A violation is a deceptive trade practice.

• ✓Prohibited to advertise false/misleading statements about rates, terms, or conditions
• ✓Prohibited to make false promises or conceal material facts to entice loan agreements
• ✓Prohibited to knowingly present fraudulent statements in support of an application
• ✓A violation is a deceptive trade practice under section 6-1-105(1)(uu)

Brokers/originators cannot engage in equity-based lending without regard to ability to repay, cannot flip loans lacking reasonable tangible net benefit, and cannot enter loans with no reasonable probability of repayment. Only original parties may sue, and no action lies against a purchaser/assignee.

• ✓Cannot lend based on collateral value without regard to ability to repay
• ✓Loan flipping without reasonable tangible net benefit is prohibited
• ✓Cannot enter a loan knowing there is no reasonable probability of repayment
• ✓Only original parties may sue; no claim against a purchaser or assignee

Real estate agents/brokers cannot make false promises or conceal material facts in mortgage transactions (constructive knowledge if directly engaged; actual knowledge if not). Mortgage broker, originator, lender, and residential mortgage loan take their 12-10-702 meanings.

• ✓Directly engaged agents liable if they knew or reasonably should have known of falsity
• ✓Non-directly-engaged agents liable only with actual knowledge
• ✓'Mortgage broker' and 'mortgage originator' mean 'mortgage loan originator' per 12-10-702(14)

For borrowers current or less than 31 days delinquent: proceeds of $40,000 or less are disbursed in one payment; proceeds over $40,000 have an initial disbursement of $40,000 or 33% (whichever greater), with the remainder disbursed by milestones and inspections.

• ✓Proceeds of $40,000 or less disbursed in one payment for current borrowers
• ✓Proceeds over $40,000: initial disbursement is $40,000 or 33%, whichever is greater
• ✓Remaining proceeds disbursed by repair/rebuild plan milestones and inspections
• ✓Borrower creates a repair/rebuild plan; servicer approves or denies within 30 days

For borrowers more than 31 days delinquent: proceeds of $5,000 or less are disbursed in one payment; proceeds over $5,000 have an initial 25% disbursement (capped at $10,000), with remaining amounts disbursed in increments of up to 25% by milestones and after inspection.

• ✓Proceeds of $5,000 or less disbursed in one payment for delinquent borrowers
• ✓Proceeds over $5,000: initial disbursement is 25%, capped at $10,000
• ✓Remaining proceeds disbursed in increments of up to 25% per milestones after inspection

First disbursement must occur within 14 days if federally insured/securitized, or within 30 days otherwise. Excess proceeds over the mortgage balance must be promptly disbursed. Undistributed proceeds are held in an interest-bearing account, and communications retained four years. Servicer must disclose the interest rate and provide a primary point of contact.

• ✓First disbursement within 14 days if federally insured/securitized, 30 days otherwise
• ✓Excess proceeds over the mortgage balance must be promptly disbursed to the borrower
• ✓Undisbursed proceeds held in an interest-bearing account benefiting the borrower
• ✓Servicer must retain all communications for at least four years

Theft by deception involving the mortgage lending process carries a mandatory minimum fine equal to the pecuniary harm. Plea deals require restitution to victims. District attorneys and the attorney general have concurrent jurisdiction. The mortgage lending process covers solicitation through releasing the mortgage.

• ✓Theft by deception in mortgage lending carries a mandatory minimum fine equal to pecuniary harm
• ✓Plea agreements must include an order of restitution to the victim
• ✓Documents include loan applications, appraisals, HUD-1 statements, W-2s, and disclosures
• ✓AG and district attorneys have concurrent jurisdiction

A person damaged by mortgage-lending theft has a private civil right of action regardless of conviction, but not against a bona fide purchaser. Making, issuing, delivering, or receiving dual contracts (differing purchase prices to induce a loan on inflated value) is a class 2 misdemeanor.

• ✓Private civil right of action exists regardless of criminal conviction
• ✓No civil claim against a bona fide purchaser of a mortgage contract
• ✓Dual contracts to induce a loan are a class 2 misdemeanor

Loan fraud includes falsified applications, fictitious income/employment/deposit verifications, false occupancy claims, and undisclosed rebates/credits. It may result in HUD disbarment from all federal programs, large fines, and federal prosecution, potentially ending a real estate career.

• ✓Loan fraud includes falsified applications and fictitious verifications
• ✓Loan fraud can result in HUD disbarment from all federal programs
• ✓Federal prosecution and large fines are possible consequences