According to the Division of Real Estate, the commission is compelled to investigate complaints against licensees. Therefore, investigation is not a discretionary action depending on the seriousness of the complaint. Routine and investigative audits into licensee activities do happen at the discretion of the commission, but when a complaint is filed, investigation is compulsory.

While there is cooperation between the Division of Real Estate and law enforcement agencies, discipline by the Division is never a substitute for criminal liability, nor are legal ramifications necessarily a substitute for disciplinary action against one's real estate license by the Division of Real Estate. Fines collected by the Division are transmitted to the state treasurer for credit to the real estate cash fund.

While cooperating with other brokers is a best practice and often required by fiduciary duty to a broker's client, failure to do so is not itself a violation of license law. Advertising, safe handling of money belonging to others, and record keeping are activities with specific guidelines outlined in Colorado license law which must be adhered to by all real estate licensees.

Telecommunication lines, water collection distribution or storage, and electric generation, transmission and distribution are all purposes for which a person may purchase, lease or sell real estate for another for a fee without a license. The sale or leasing of private dwellings for another for a fee is not exempt and requires a real estate license.

During each 3 year cycle, a real estate broker must complete the 12 hours of mandatory commission update credits and 12 additional hours of education from approved course providers on topics such as real estate law, finance, appraisal, ethics, brokerage administration, and any other subject matter approved by the Commission.

If the broker has passed the real estate license examination within the previous 3 years, they are exempt from additional continuing education requirements for license renewal. Real Estate license renewal requires the licensee to complete 24 continuing education credits in the previous 3 years or passage of the Colorado portion of the real estate exam.

A designated broker is the broker that has been designated by their employing broker to a transaction, either by request of the consumer or assignment by the employing broker. Brokerage firms comprised of only one person need not provide a written designated broker.

The Division of Real Estate requires real estate brokerages to maintain an office policy manual. It is not just a recommended best practice. All other possible answers describe additional provisions of the requirement.

Brokerage relationships and duties are established through contractual agreement between the parties. The payment or acceptance of commissions, in itself, does not establish a relationship or responsibilities between parties.

If one's license is suspended, all activities requiring a license must cease immediately regardless of whether the client was already under contract or working with the broker prior to the change. Commissions earned prior to the suspension may still be disbursed to the licensee regardless of license status.

Referrals involving settlement services are not compensable, regardless of whether a recommendation is requested by a client, under the Real Estate Settlement Procedures Act (RESPA). Referral fees between brokers, brokerage firms and non-settlement providers are permitted when an actual introduction of businesses has been made or contractual relationship has been established between the referring parties.

The existence of an unexpired listing contract between a consumer and a broker shall be respected by other real estate brokers. While the commission does allow for the possibility that the consumer initiates contact with other brokers to discuss next steps after the current contract has expired, under no circumstances may a broker pursue a contract with that consumer until the existing contract has expired.

In a short sale transaction, the seller has debts secured by liens on the property which the sale price will not be enough to pay off. In addition to the buyer and seller coming to an agreement, as with any residential property transaction, the lien holder must also agree to the terms of the transaction. The lien holder may agree to release the lien against the property either by accepting less than the amount owed to repay the debt or agreeing to release the lien on the property without releasing the seller from liability for the unpaid portion. A closing cannot occur without the signatures of all three parties.

An Installment land contract is an agreement for the purchase of real estate on a payment plan to the owner rather than a mortgage lender in which the deed is withheld until the full purchase price, or a predetermined percentage, is paid by the buyer. The real estate commission has revoked its approval of the installment land contract and cautions that any use of such a contract must be drafted by an attorney and poses significant risk to all parties involved in the transaction.

Also called a trust account, an escrow account is any bank account insured by the US government that is intended for the safekeeping of money belonging to others. The depository may consist of any type of bank account including checking or savings accounts which exist for the purpose of holding trust funds.

Security deposits are always refunded to the tenant unless the lessor is able to establish a right to the security deposit or there is an agreement otherwise. The only exception is the property managers of mobile home parks who may keep the interest as compensation.

When a broker is hired to provide property management services, he is to provide a management agreement drafted by an attorney which outlines the duties and responsibilities of both parties. This agreement is between the licensee and landlord and may be used in conjunction with the exclusive right to lease listing contract if the licensee is offering the service to lease as well as manage the property. A lease agreement is an agreement between the tenant and landlord. Exclusive tenant contract is used when a tenant hires a broker to find a rental property and provide leasing services to the tenant.

The duty to seek rent and terms acceptable to the landlord is owed to the landlord under agency agreement, however the broker shall not be obligated to seek additional offers to lease the property while a property is subject to a lease or letter of intent to lease. Additional duties owed to the landlord include promoting the interests of the landlord with the utmost good faith, loyalty and fidelity, counseling the landlord as to material benefits or risks known to the broker, and accounting for all money and property received in a timely manner.

The date of the sale and the date that taxes become due govern how to determine the prorated amount owed by the seller and buyer. The seller pays prorated taxes at closing on the date of sale and deducts that amount on Schedule A.

These items are always included in the sale unless explicitly listed as an exclusion: lighting, heating, plumbing, ventilating and air conditioning units, TV antennas, inside telephone, network and coaxial wiring and connecting blocks/jacks, mirrors, floor coverings, intercom systems, kitchen appliances, sprinkler systems and controls, built-in vacuum systems, garage door openers, storm windows, storm doors, window and porch shades, awnings, blinds, screens, window coverings and treatments, fireplace inserts, grates and screens, heating stoves, storage sheds, carbon monoxide alarms, smoke/fire detectors and all keys.

Brokers are not authorized to draft forms for use in real estate transactions but are permitted to complete the blanks on any approved forms. If a custom form is required for a situation that is not adequately covered by Commission Approved Forms, the broker may hire a licensed attorney to draft the document.

The listing broker is required to deposit earnest money into their trust account by the third business day following contract acceptance. In the event that a listing has agreed to accept a promissory note and the selling broker receipts for a promissory note, it must be delivered to, held by, and payable to the listing broker. The listing broker must complete the earnest money receipt and retain a copy in compliance with record keeping regulations. Promissory notes are rarely used in practice, but are an option if the seller, usually a new construction builder, agrees and sets an alternative earnest money deadline for the payment of the note.

Regardless of who is hired to conduct the closing proceedings, ensuring the accuracy of closing statements is always the responsibility of the broker and their employing broker if they are an associate broker.

The closing statements are prepared by the closing company in accordance with the written instructions which have been signed by the buyer and seller confirming their accuracy and incorporating the terms of the contract. All of these parties and the brokers who represent them must confirm the accuracy of closing statements and sign them. If any of the written instructions differ from the contract, the buyer and seller must execute an Agreement to Amend/Extend Contract.

While brokers are permitted to close their own transactions, title companies are the most common provider of closing services in Colorado. If a title company is engaged to provide the closing services, it is the "Closing Company" and it is the responsibility of the title company to complete the closing instructions provided by the parties in the transaction as required by the Division of Insurance including preparation, delivery and recording of the closing documents and disbursement of funds.

The closing statement is prepared and signed by all parties to the transaction to ensure accuracy and completeness. However, no party waives their right to pursue civil action in the future should a situation come to light that would warrant arbitration, mediation or civil proceedings.