Key Takeaways
- Colorado requires written brokerage relationship disclosure at the earliest reasonable opportunity
- Colorado recognizes four relationship types: Seller's Agent, Buyer's Agent, Transaction-Broker, and Customer
- Transaction-Broker is Colorado's default relationship when no other agreement exists
- The Brokerage Disclosure to Buyer form and Brokerage Disclosure to Seller form are required disclosures
- Colorado uses statutory forms approved by the Real Estate Commission for brokerage relationships
Colorado Brokerage Relationships
Important: This content covers Colorado-specific agency law. You should complete the National Real Estate Exam Prep first, as agency concepts are also tested on the national portion.
Colorado has a unique statutory framework for brokerage relationships defined in C.R.S. 12-10-403 and Real Estate Commission Rule E.
Key Terminology
| Term | Definition |
|---|---|
| Single Agent | Broker representing only buyer OR only seller |
| Transaction-Broker | Broker assisting both parties without advocating for either |
| Customer | Party not represented by a broker |
| Designated Broker | Broker assigned to represent one party exclusively |
Relationship Types in Colorado
Colorado recognizes these brokerage relationships:
1. Seller's Agent (Single Agency)
- Represents the seller exclusively
- Owes fiduciary duties to seller
- Created by written listing agreement
- Must disclose to buyers
2. Buyer's Agent (Single Agency)
- Represents the buyer exclusively
- Owes fiduciary duties to buyer
- Created by written buyer agency agreement
- Must disclose to sellers
3. Transaction-Broker
- Assists both parties in the transaction
- Does NOT advocate for either party
- Provides limited services to both
- DEFAULT relationship in Colorado
4. Customer
- Party not represented by any broker
- Broker may perform ministerial acts
- No fiduciary duties owed
Exam Tip: Transaction-broker is the DEFAULT in Colorado. If no written agency agreement exists, the broker is automatically a transaction-broker.
Required Disclosures
Timing of Disclosure
Colorado requires disclosure at the earliest reasonable opportunity:
| Situation | Disclosure Timing |
|---|---|
| First substantive contact | Immediately |
| Open house | When meaningful discussion begins |
| Before confidential information shared | Must disclose first |
| Before showing property | Should be disclosed |
Commission-Approved Forms
Colorado uses statutory forms:
| Form | Purpose |
|---|---|
| Brokerage Disclosure to Buyer | Explains buyer relationship options |
| Brokerage Disclosure to Seller | Explains seller relationship options |
| Exclusive Right-to-Sell Listing Contract | Creates seller agency |
| Exclusive Right-to-Buy Contract | Creates buyer agency |
| Transaction-Broker Disclosure | Confirms TB relationship |
What Must Be Disclosed
At earliest reasonable opportunity, disclose:
- The types of relationships available in Colorado
- The broker's role in the transaction
- Whether the broker represents buyer, seller, or neither
- Duties owed under each relationship type
Default Transaction-Broker Relationship
When no written agreement exists:
| Feature | Transaction-Broker Default |
|---|---|
| Advocacy | None - neutral position |
| Confidentiality | Does not share confidential info |
| Duties | Limited duties to both parties |
| Creation | Automatic without agreement |
Transaction-Broker Duties
Even without single agency, transaction-brokers must:
- Deal honestly and in good faith
- Account for money and documents
- Use reasonable skill and care
- Disclose adverse material facts
- Present all offers and counteroffers
- Assist both parties with contract and closing
What is the default brokerage relationship in Colorado when no written agreement exists?
When must a Colorado broker disclose their brokerage relationship?