§ 12-10-101 & 12-10-201 – Definitions +14Colorado · Real Estate · English

A 'real estate broker' is any person or entity that, for compensation or intending to receive compensation, engages in acts such as selling, buying, renting, leasing, exchanging, negotiating, listing, auctioning real estate, or acting as an option dealer — by continuing conduct or a single transaction.

• ✓A broker acts for compensation or intent to collect compensation
• ✓Brokerage includes selling, buying, renting, leasing, exchanging, listing, auctioning, or negotiating real estate
• ✓A single act or transaction can qualify as brokerage activity

The broker definition does NOT apply to: attorneys-in-fact acting without compensation; public officials; receivers/trustees/executors/guardians; persons acting as principals for their own property; attorneys-at-law representing clients; owners/officers dealing with their own property (subject to conditions); on-site apartment and condominium managers; and out-of-state brokers receiving cooperative commissions.

• ✓Attorneys-in-fact acting without compensation are exempt
• ✓Owners acting as principals for their own property are exempt
• ✓On-site salaried apartment/condo managers are exempt for customary duties
• ✓Out-of-state brokers receiving cooperative commission shares are exempt

'Employing broker' means a broker shown in Commission records as employing or engaging another broker. 'Option dealer' means any person/entity that takes or uses an option to purchase, exchange, rent, or lease real property with intent to deal in it for another.

• ✓'Employing broker' is shown in Commission records as employing another broker
• ✓'Option dealer' uses options with intent to buy/sell/lease property to others

'Director' means the director of the division of real estate. 'Division' means the division of real estate. 'HOA' means an association or unit owners' association formed as part of a common interest community under section 38-33.3-103.

• ✓'Director' = director of the division of real estate
• ✓'HOA' = association formed as part of a common interest community under 38-33.3-103

Brokers must satisfy CE requirements before renewing an Active License, activating an Inactive License, or reinstating an Expired License to Active status. Brokers whose license expires December 31 of the year first issued are not subject to CE for that renewal. The total requirement is 24 hours per licensing cycle.

• ✓CE must be completed before renewal, activation, or reinstatement to active
• ✓First-year renewals (expiring December 31 of issuance year) are exempt from CE
• ✓Total CE requirement is 24 hours per licensing cycle

Brokers satisfy CE via: (1) 12 hours of Annual Commission Update in 4-hour annual increments plus 12 elective hours; (2) during Transition Period, two Update versions (8 hours) plus 16 elective hours; (3) the 24-hour Broker Reactivation Course under limited conditions; (4) passing the Colorado exam portion; or (5) completing 72 total hours of specified prelicensing courses. A broker cannot repeat the same Update version.

• ✓Annual Commission Update plus electives totals 24 hours
• ✓A broker may not take the same version of the Annual Commission Update twice
• ✓Passing the Colorado exam portion is an alternative CE method

The Annual Commission Update is developed and presented by the Division to approved course providers and must be presented without additional content. Brokers must achieve a passing score of 70% on a Commission exam. Providers must apply annually for approval to offer the Update.

• ✓Passing score of 70% required on the Update examination
• ✓Course must be presented without additional provider content
• ✓Providers must apply annually to offer the Update

CE courses must be developed by qualified persons, be current, improve broker skills, and be at least one hour (50 instructional minutes per hour). Eligible topics include real estate law, contracts, finance, appraisal, closing, ethics, property management, agency, commercial real estate, and others approved by the Commission. Ineligible topics include sales/marketing meetings, motivational seminars, self-promotion, and exam prep.

• ✓Each CE hour requires at least 50 instructional minutes
• ✓Motivational, sales, and exam-prep courses are ineligible for CE credit
• ✓Eligible topics include law, contracts, ethics, and agency

A maximum of 8 CE hours may be earned per day, courses cannot repeat for credit in the same calendar year, and excess hours cannot carry forward. Attending a Commission public meeting (min 2 hours) earns 2 elective hours (one per year). Brokers must retain proof of CE completion for four years and can attest to compliance by submitting a renewal application.

• ✓Maximum 8 CE hours per day; excess cannot carry forward
• ✓Brokers must retain CE completion proof for four years
• ✓Commission public meeting attendance earns 2 hours (once per year)

Rebates to a buyer obtaining financing must be disclosed to the lender, included on the settlement statement, and approved by the lender; failure may constitute loan fraud. Rebates should be documented in writing and never paid outside of closing.

• ✓Buyer rebates with financing must be disclosed to and approved by the lender
• ✓Undisclosed rebates may constitute loan fraud
• ✓A rebate must never be paid outside of closing

A broker may not pay commission to unlicensed persons, but rebating a portion of the firm's earned commission to a consumer with whom the broker has a brokerage relationship is permitted. RESPA does not prohibit gifts/incentives not conditioned on referral of business.

• ✓Rebating earned commission to a consumer client is permitted
• ✓Gifts/incentives not conditioned on referral of business are allowed under RESPA
• ✓Broker may add money/concessions to secure a listing

Confidential client information may only be shared with the Employing Broker if the Designated Broker obtains the client's informed written consent. Commission Rule 6.27 sets forth the requirements for informed consent. If consent is not obtained, the Employing Broker must use alternative solutions to fulfill supervisory duties.

• ✓Confidential information can only be shared with the Employing Broker with the client's informed written consent
• ✓Commission Rule 6.27 governs the requirements for informed consent
• ✓Without consent, the Employing Broker (or a competent delegated broker) may be designated as an additional Designated Broker, adopting the same duties (e.g., co-listing)
• ✓Any designation of an additional Designated Broker should be made in writing so all parties know who the designated brokers are

The Employing Broker has several non-exhaustive options to supervise while protecting confidential client information when informed consent is not given.

• ✓Direct brokers via training and Office Policy Manual to exclude or redact confidential information from listing contracts before review by anyone other than the Designated Broker
• ✓Adopt a policy to refer the client to another broker, brokerage firm, or attorney when the transaction/client circumstances are too complex and the client refuses informed consent
• ✓The Employing Broker must assess the abilities and experience of the Designated Broker and anticipate potential issues when choosing a solution

When collecting past-due assessments, associations must adopt a compliant collections policy and make a good-faith effort to set up a payment plan. Payment plans must allow the owner to pay off deficiencies in equal installments over at least 18 months.

• ✓Association must make good-faith effort to establish a payment plan with the owner
• ✓Payment plans must permit payoff in equal installments over at least 18 months
• ✓Association not required to negotiate a new plan with an owner who previously had one

Payments must be applied first to assessments, then to fines/fees/charges. An association cannot foreclose while the owner complies with a required payment plan. Missing three or more installments, or failing to stay current, constitutes default.

• ✓Payments applied first to assessments, then to fines, fees, or other charges
• ✓Cannot foreclose while owner is in compliance with a required payment plan
• ✓Failure to remit three or more installments constitutes failure to comply with the plan

If an association violates foreclosure laws, the affected owner may file suit within five years and recover damages up to $25,000 plus costs and reasonable attorney fees, upon proving the violation by a preponderance of evidence.

• ✓Owner may sue within five years of a foreclosure law violation
• ✓Court may award damages up to $25,000 plus costs and reasonable attorney fees

A quorum is a majority of directors in office immediately before the meeting unless bylaws require a greater or lesser number. Bylaws may authorize a quorum of no fewer than one-third of directors.

• ✓A quorum consists of a majority of directors in office unless bylaws require a greater or lesser number
• ✓Bylaws may reduce the quorum to no fewer than one-third of the number of directors
• ✓If a quorum is present, the affirmative vote of a majority of directors present is the act of the board

Directors generally may not vote by proxy except where bylaws allow a signed written proxy for a specific proposal. A director present when action is taken is deemed to assent unless the director objects, requests dissent be entered in minutes, or delivers written dissent.

• ✓Directors may not vote by proxy except as specifically permitted by bylaws with a signed written proxy for a described proposal
• ✓A present director is deemed to have assented to action unless they object, request minute-entry of dissent, or deliver written dissent
• ✓The right of dissent is not available to a director who voted in favor of the action

An individual may not originate or offer to originate a mortgage or act as an MLO unless licensed by the Board and registered with NMLS as a state-licensed loan originator. Licensed MLOs must apply for renewal each calendar year as determined by board rule.

• ✓Must be licensed by the board AND registered with NMLS before originating
• ✓Independent contractor loan processors/underwriters must be state-licensed
• ✓License renewal required every calendar year

Initial applicants must submit a criminal history record check, disclosure of administrative discipline, and the application fee. Since August 5, 2009, applicants must also complete at least 20 hours of NMLS-approved education and pass a written examination approved by the board.

• ✓Must submit criminal history check, discipline disclosure, and application fee
• ✓Must complete at least 20 hours of NMLS-approved education
• ✓Must pass a written examination approved by the board
• ✓Must post a surety bond and obtain errors and omissions insurance

Applicants must submit fingerprints to the Colorado Bureau of Investigation for a state and national criminal history record check, bearing all costs. A name-based judicial record check is required for applicants with an arrest without disposition.

• ✓Applicant must submit fingerprints to CBI and pay all costs
• ✓CBI conducts state and national criminal history check via CBI and FBI records
• ✓Name-based judicial record check required if arrest has no disposition
• ✓Board may authorize use of NMLS criminal background check by rule

The board must issue or deny a license within 60 days after receiving the requisite information, fees, bond, E&O insurance, and completed criminal history check. Renewal requires at least eight credit hours of continuing education each year.

• ✓Board must issue or deny within 60 days of complete submission
• ✓Applicant must show surety bond and errors and omissions insurance
• ✓Licensees must complete at least eight credit hours of CE each year

On/after January 1, 2010, applicants must furnish identity information to NMLS including fingerprints and personal history, plus authorization for an independent credit report and information on administrative, civil, or criminal findings.

• ✓Must furnish fingerprints and personal history to NMLS
• ✓Must authorize NMLS to obtain an independent credit report
• ✓Must authorize collection of administrative, civil, or criminal findings

MLOs must annually renew through NMLS whether Active or Inactive. The renewal period begins November 1st and ends December 31st each calendar year. All licenses expire at midnight December 31st if not properly renewed. The Board will issue or deny a renewal within 30 days after all necessary information is submitted. Inactive-status MLOs are not required to maintain E&O insurance or a surety bond but must stay current on CE.

• ✓The renewal period begins November 1st and ends December 31st each year
• ✓Licenses expire at midnight December 31st if not properly renewed
• ✓Inactive MLOs need not maintain E&O or surety bond but must stay current on CE
• ✓The Board issues or denies renewal within 30 days of complete submission

MLOs who fail to renew may reinstate. The reinstatement period begins January 1st and ends on the last day of February each calendar year. The reinstatement Fee is one and one-half times the current renewal Fee. To reinstate, the MLO must complete the renewal process. Those who fail to reinstate during the period must re-apply.

• ✓The reinstatement period runs January 1st through the last day of February
• ✓The reinstatement Fee is one and one-half times the current renewal Fee
• ✓Failure to reinstate during the period requires re-application

Re-application requirements depend on how long the license has been expired: expired less than 3 years requires fingerprints, NMLS registration, Colorado-specific education if not taken, and 8 hours of late CE (including 1 hour Colorado-specific); expired 3 but less than 5 years requires relevant pre-licensing education and 8 hours of late CE; expired 5+ years requires all the 3-5 year requirements PLUS retaking and passing the S.A.F.E. exam.

• ✓Expired less than 3 years: complete Colorado-specific education (if not taken) and 8 hours late CE including 1 hour Colorado-specific
• ✓Expired 3 but less than 5 years: complete relevant pre-licensing education and 8 hours late CE
• ✓Expired 5 or more years: must retake and pass the S.A.F.E. exam plus the 3-5 year requirements

Individuals without an Active license are prohibited from practicing as an MLO and from engaging in any mortgage-related activities requiring licensure. MLOs with an Inactive license are likewise prohibited from practicing. To reactivate an Inactive license, the MLO must provide proof of full compliance with the Practice Act and Rules. No license status change is made except upon payment of the applicable Fee.

• ✓Individuals without an Active license may not practice as an MLO or engage in activities requiring licensure
• ✓Inactive-license MLOs are prohibited from practicing as an MLO
• ✓Reactivation requires proof of full compliance with the Practice Act and Rules

Mortgage Companies must renew registration through NMLS with the same November 1–December 31 renewal period and January 1–last day of February reinstatement period. Registrations expire at midnight December 31st if not renewed. Companies without an approved registration are prohibited from acting through employees who take applications or offer/negotiate terms. All renewal, reinstatement, or re-application fees are paid through NMLS and are non-refundable.

• ✓Mortgage Company registration follows the same November 1–December 31 renewal period
• ✓Companies without approved registration may not act through employees taking applications or offering/negotiating terms
• ✓All Mortgage Company fees paid through NMLS are non-refundable

A license may be inactivated by the Board for failing to comply with surety bond requirements, E&O insurance requirements, maintaining current contact/bond/insurance information, responding to an investigation, education/testing requirements, or registering with and providing required NMLS information. Reactivation requires payment of an administrative Fee determined by the Board.

• ✓A license may be inactivated for failure to comply with surety bond or E&O insurance requirements
• ✓Failure to respond to an investigation is a ground for inactivation
• ✓Reactivation requires payment of an administrative Fee determined by the Board

All records required to be maintained by Brokers or Brokerage Firms may be kept as Electronic Records. These records (electronic or printed) must be produced upon request by the Commission or any principal party in a format that can be retrieved and legibly printed.

• ✓Broker records may be maintained as Electronic Records
• ✓Records must be produced upon request by the Commission or any principal party to the transaction
• ✓The format must retain the continued capability to be retrieved and legibly printed

Every developer required to register must submit an application with prescribed information; the Commission may accept out-of-state registrations that provide substantially equivalent protection.

• ✓Application must contain information described in subsections (2) and (3); incomplete submissions may be denied
• ✓Commission may accept proof of substantially equivalent out-of-state registration in full or partial satisfaction
• ✓Applicant must notify Commission within ten (10) days of any change in submitted information
• ✓Failure to notify of changes is cause for disciplinary action

Registration must include detailed developer information covering offices, ownership, business history, felonies, and prior regulatory actions.

• ✓Must include principal office location (wherever situated) and Colorado principal and branch offices
• ✓Must disclose all natural persons with 24% or greater financial/beneficial interest, specifying capacity, title, and ownership percentage
• ✓If no one holds 24%+, must report the person with the largest single interest
• ✓Must disclose felonies within preceding ten years (Commission governed by section 24-5-101)
• ✓Must disclose states where similar license/registration was granted, refused, suspended, revoked, or under investigation
• ✓Corporate developers must attach certificate of authority or certificate of incorporation from the secretary of state

Registration must include comprehensive subdivision details covering location, title, encumbrances, forms, utilities, surveys, and common interest communities.

• ✓Must include location and name of each subdivision and trade/corporate/partnership name
• ✓Must certify each subdivision is or will be registered per state/local requirements
• ✓Must provide title documents and, if a blanket encumbrance exists, release/subordination arrangements protecting purchasers
• ✓Must state that standard commission-approved forms will be used unless prepared by developer's attorney
• ✓Must advise purchasers to record installment contracts; developer may NOT prohibit recording
• ✓Must state provisions/availability of legal access, sewage disposal, and utilities and whether developer or purchaser expense

The Commission may reject inadequate document forms and requires fees with each registration.

• ✓Commission may disapprove document form and deny registration until satisfactory documents submitted
• ✓Each registration must be accompanied by fees established under section 12-10-215

Notwithstanding lease provisions to the contrary, a tenant may install at their own expense a level 1 or level 2 EV charging system on the leased premises, an assigned/deeded parking space, or a shared parking space. Landlords cannot charge fees for placement or use, except for reimbursement of actual electricity cost, a reasonable access fee, network fees, or installation costs when the landlord installs at tenant's request.

• ✓Tenants may install level 1 or level 2 EV charging systems at their own expense
• ✓Landlords may not charge fees except actual electricity cost, reasonable access fee, or installation reimbursement
• ✓Landlords cannot restrict parking based on a vehicle being plug-in hybrid or plug-in electric
• ✓This section applies to both residential and commercial rental properties

Landlords may require compliance with bona fide safety requirements, registration within 30 days after installation, and reasonable aesthetic provisions. For shared-area installations, tenants must comply with design specs, use licensed electricians, and provide a certificate of insurance naming the landlord as additional insured within 14 days after consent.

• ✓Landlord may require system registration within 30 days after installation
• ✓Certificate of insurance must be provided within 14 days after receiving landlord's consent
• ✓A charging system installed at tenant's cost is property of the tenant
• ✓EV system must be UL certified and comply with article 625 of the national electrical code

A plat or map is part of the declaration and required for all communities except cooperatives. A map is required only for communities with units having horizontal boundaries. Each plat/map must be clear and legible with a certification.

• ✓A plat or map is required for all common interest communities except cooperatives
• ✓A map is required only where units have a horizontal boundary
• ✓Any certification of a map must be made by a registered land surveyor

Maps must show community name/schematic, dimensions of real estate, encroachments, easements, unit boundaries and identifying numbers, reserved development units, and locations of limited common elements.

• ✓Maps must show unit vertical and horizontal boundaries and identifying numbers
• ✓Maps must show existing encroachments and legally sufficient descriptions of easements
• ✓Plat/map requirements do not satisfy local subdivision platting requirements

There are three requirements for appraiser licensure: education, examination, and experience. Specific requirements for licensed, certified, and ad valorem credentials are detailed under Board Rules 2.2, 2.3, 2.4, and 2.9.

• ✓Three requirements for licensure: education, examination, and experience
• ✓Specific requirements are detailed under Board Rules 2.2, 2.3, 2.4, and 2.9

Applicants must register for and pass the appropriate exam with the Board's designated testing service. Exam levels: Licensed Ad Valorem = Licensed Ad Valorem exam; Appraiser = Licensed Real Property Appraiser exam; Residential Appraiser = Certified Residential exam; General Appraiser = Certified General exam. Examinees may use financial calculators with memory cleared before and after.

• ✓Only the designated testing service's exam results are accepted
• ✓Financial calculators allowed but memory must be cleared before and after the exam
• ✓Each license level has a corresponding examination

A passing score must be attained within two (2) years from the issuance date of the Letter of Exam Eligibility (except Ad Valorem). Failure to pass within two years results in application denial. One instructor per approved provider may take the exam once per 12-month period for research.

• ✓Passing score must be attained within two (2) years of the Letter of Exam Eligibility issuance
• ✓Failure to pass within two years results in application denial
• ✓One instructor per provider may take the exam once per 12-month period for course research

It is unlawful to engage in the business or capacity of real estate broker in Colorado without first obtaining a license. No license is granted until the applicant establishes compliance with education, experience, testing, truthfulness, honesty, good moral character, and competency requirements. Character determination is governed by section 24-5-101.

• ✓A license must be obtained BEFORE engaging in brokerage activity
• ✓Applicant must prove education, experience, testing, honesty, and competency
• ✓Character is determined per section 24-5-101

Before submitting an application, each applicant must submit fingerprints to the Colorado Bureau of Investigation for a state and national criminal history record check. The applicant pays the fee. A name-based judicial record check is required for applicants with an arrest record without disposition.

• ✓Fingerprints must be submitted to CBI before applying, for state and national background check
• ✓Applicant pays the fingerprint-based background check fee
• ✓Name-based judicial record check required for arrests without disposition

An applicant must be at least 18 and complete approved courses: 48 hours in real estate law and practice; 48 hours in Colorado real estate contracts; and 72 total hours covering trust accounts/record keeping, closings, current legal issues, and practical applications. A real estate degree may substitute.

• ✓Applicant must be at least 18 years old
• ✓Requires 48 hrs law/practice + 48 hrs Colorado contracts + 72 hrs additional topics
• ✓A qualifying real estate degree can satisfy education requirements

Brokers not holding a valid license on Dec 31, 1996 must serve actively 2 years before independent practice. To employ another broker, they must complete 24 hours of brokerage administration instruction. Effective Jan 1, 2019, a broker cannot act as employing broker without demonstrating experience and knowledge to supervise.

• ✓2 years of active experience required before independent brokerage practice
• ✓24 clock hours of brokerage administration required before employing another broker
• ✓Employing brokers must demonstrate experience/knowledge to supervise (eff. 1/1/2019)

Licenses may be issued to individuals, partnerships, LLCs, or corporations. An entity must designate a qualified active broker responsible for managing and supervising licensed actions. That broker must pass the exam on the entity's behalf; the entity license bears the designated broker's name. A temporary license (up to 90 days, one extension) may be issued if the designated broker ceases.

• ✓Entities must designate a qualified active broker who passes the exam on the entity's behalf
• ✓The entity license bears the designated broker's name
• ✓Temporary license may be issued up to 90 days (one 90-day extension) if designated broker ceases

The designated broker is personally responsible for handling all earnest money deposits and escrow/trust funds of the entity. Any breach of fiduciary duty allows aggrieved parties to pursue both the entity and the designated broker personally, with judgments enforceable jointly or severally.

• ✓Designated broker is personally liable for entity earnest money and trust funds
• ✓Judgments may be enforced jointly or severally against the broker personally and the entity

Every licensed real estate broker must maintain a place of business within Colorado (except as provided in 12-10-208 for nonresidents). If a broker maintains more than one office, the broker is responsible for supervising all licensed activities originating in those offices.

• ✓Brokers must maintain an in-state place of business (except nonresidents under 12-10-208)
• ✓Brokers with multiple offices must supervise all activities from those offices

Applicants must pass an exam covering ethics, math, land economics, appraisal, financing, statutes and law relating to deeds, mortgages, listing contracts, agency, brokerage, trust accounts, closings, securities, plus preparation of a closing statement. The Commission sets the minimum passing score.

• ✓Exam covers ethics, math, contracts, agency, trust accounts, closings, and law
• ✓Exam requires preparation of a real estate closing statement
• ✓The Commission sets the minimum passing score

No person may be licensed under more than one name, and no one may conduct a brokerage business except under the licensed name. A licensed attorney must pass the exam after completing 12 hours of instruction in trust accounts, record keeping, and real estate closings.

• ✓A person may be licensed under only one name
• ✓Licensed attorneys must complete 12 hours (trust accounts, records, closings) and pass the exam