Colorado Real Estate Contract: Different Types and Key Terms to Include
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What is a Colorado Real Estate Contract?
A Colorado real estate contract, sometimes called a purchase and sale agreement, is a contract that is negotiated between a buyer and a seller to facilitate the sale of real property. These contracts are most commonly used when purchasing an existing residential property.
Colorado has a specific agreement that is used to buy and sell residential property called the Colorado Real Estate Commission’s Contract to Buy and Sell Real Estate. This form makes the buying and selling process uniform in Colorado and most real estate brokers will utilize this specific contract when guiding clients through the buying and selling process.
Common Colorado Real Estate Contracts
In addition to the Colorado Real Estate Commission’s approved contract used to purchase real estate, there are a couple other types of contracts that may be used when dealing with real estate. These contracts include:
- Real estate assignment contract. Used when purchasing “distressed properties” as a wholesale investment strategy. This contract allows the buyer to assign the contract to a second buyer.
- Lease agreement. Used when a landlord wants to rent their property to a tenant for use in exchange for a monthly rent.
- Commercial property purchase agreement. Used when buying or selling a commercial property that is zoned for business purposes like an office building or storefront.
4 Essential Elements of a Colorado Real Estate Contract
A Colorado real estate contract must include specific elements to make the document a valid and legally binding agreement. Using the Colorado Real Estate Commission purchase agreement takes the guess work out of contract drafting, but if a real estate broker chooses to draft their own real estate contract, it should contain these 4 essential elements:
- Identification and contact information of the buyer and the seller
- Description of the property
- Agreed upon purchase price
- Closing date and method of transferring the title
What Must Be Included in a Colorado Real Estate Contract?
A Colorado real estate contract needs to include certain information to ensure that both party’s interests are protected during the transaction. Every real estate contract should include the following essential information which can be found on the Colorado Real Estate Commission’s approved form:
- Deadlines. During the home buying process, there will be several deadlines that both parties must be aware of. The contract should lay out what tasks need to be completed, like a home inspection, and the deadline to complete these tasks.
- Earnest money deposit. An earnest money deposit is paid by the buyer once the seller accepts their offer. This deposit shows the seller that the buyer is serious about purchasing the house.
- Financing. The buyer will usually need to secure financing to purchase the house. The contract should include all applicable information relating to financing and a contingency that allows the buyer to back out of the contract if they cannot secure financing.
- Inspections. Colorado law requires sellers to fill out a Colorado Real Estate Commission approved property disclosure form. This form allows the seller to disclose the condition of the property and any issues that could affect the value of the property.
Can a Buyer Terminate a Real Estate Contract in Colorado?
Yes. Under certain circumstances, a buyer can terminate a real estate contract in Colorado. The Colorado Real Estate Commission contract provides buyers with eleven opportunities to terminate the contract without losing their earnest money deposit.
These opportunities include contingencies that protect the seller if they cannot get approved for financing, if there is an issue with the property title, if the house doesn’t pass inspection, or if the property doesn’t appraise.
Frequently Asked Questions
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Business law attorney with over 20 years of experience in contracts, entity formation and risk management
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Patrick O.
20+ years as both a business executive and also an attorney, I create practical business solutions for legal issues. See Reviews: https://drive.google.com/drive/folders/1EZ4MMM5Tc0hrfwtgl0TN5G7j0QcfYA4q
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Odini G.
I am an accomplished attorney with more than 16 years of experience and extensive expertise in business negotiations, commercial contracts, and technology transactions. With a proven track record of providing strategic legal advice and delivering exceptional results, I have successfully assisted numerous clients in drafting, reviewing, and negotiating various business arrangements. My experience encompasses a wide range of areas, including intellectual property, data privacy and security, SaaS agreements, and software licenses. I co-founded a reputable general corporate law firm with three offices in Aspen, Atlanta, and New York. As a partner and attorney, I represented diverse clients, including start-ups, public corporations, investors, financial institutions, educational institutions, and non-profit entities. With a focus on delivering comprehensive legal solutions, I provided general counsel, expert dispute resolution, efficient litigation management, and skillful contract drafting and negotiations for businesses across industries.
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Ryan Clement, the Principal Attorney at Business and Technology Legal Group (www.businessandtechlawyers.com), has been a Colorado licensed attorney for almost 20 years and has extensive experience in all matters related to corporate law, software and technology law, intellectual property, data privacy and security, business startups/formation, commercial transactional matters, general business counsel, compliance, and litigation. Ryan graduated with high honors from the University of California, Santa Barbara before attending the University of California, Davis School of Law and graduating in 2004. Post-law school, he completed an esteemed two-year judicial clerkship at the Second Judicial District Court of Nevada. In 2007, Ryan Clement became a licensed attorney in private practice, working at several prestigious law firms before forming and operating his own successful law firm in 2012 at the age of only 31. This keen business acumen and entrepreneurial drive was the impetus behind Ryan’s desire to practice business and technology law, ultimately forming the foundation of Business and Technology Legal Group. In addition to his top-tier legal credentials, Ryan also holds a Master of Business Administration (MBA) degree from the University of Colorado, Denver, and has over a decade of experience working in the software industry at Fortune 500 and publicly traded companies. This vast experience in the technology and software sector, combined with his many years as an attorney provides the intersection of legal, technical, and business skill sets that sets Ryan apart from the crowd of business and technology attorneys in the market.
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Real Estate
Real Estate Contract
Illinois
what is better to buy land or rent for construction in US?
we are a construction company from Ukraine, we are planning to build a cottage town in the USA
T. Phillip B.
I suppose it doesn't matter if you have the lease giving you permission and the lease is long enough to justify the building expense when you won't own it. But I'd buy the land so you could eventually sell the property with the building on it.
Real Estate
Real Estate Contract
Georgia
WHAT ARE YOUR FEES TO PERFORM QUIT CLAIM DEED COMPLETE BUTTS COUNTY GEORGIA 30233
SON AND EX
Meghan T.
Hi. The cost for my practice to prepare a Quit Claim Deed is $99. The Cost for me to handle the closing is $250 plus recording fees. These costs apply for any county within the state of Georgia. Let me know if you have any more questions. Meghan K Thomas
Real Estate
Real Estate Contract
Georgia
How many years does a quick claim become effective?s
Number of years for quick claim to be effect ive
Meghan T.
A quit claim deed is effective upon execution so long as the deed is dated as of the date of signature. Execution means that the deed is signed, in front of a witness and a notary. The witness and notary must also sign the deed. Finally, the deed must be recorded. This means that the deed must be submitted to the Superior Court recording office of the County in which the property sits. Please let me know if you have any questions. Thanks, Meghan K Thomas
Real Estate
Real Estate Contract
New York
Can you purchase or refinance under a land contract?
I’ve been living here for 2 years. Currently have been working with my credit union and they are having a terrible time trying to understand the legalities of my land contract first off, and secondly they just don’t seem to know what they are doing. It’s been over 8 months, 4 different loan officers and I’m once again waiting for someone else to help finish this thing out. It’s only $60,000 with a $120,000 appraisal. So, as of now I am stuck paying 2.5x monthly under this land contract than I was promised would be an easy mortgage process. So any guidance in the right direction would be very helpful. It’s a New York home. 20 yr fixed, no balloon, with a (brace yourself) 12% apr. HELP ME PLEASE! One month I’m being told to authorize a credit check for a first time homebuyer grant method of mortgaging this property. The next it’s authorizing it for a refinance. I do have earnest money deposits for over $3,000 and another $3000 paid towards principal under this land contract also.
Jane C.
I suggest you speak with a New York real estate attorney. That attorney needs to review the documents related to the transaction.
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