Colorado Real Estate Practices
- Attorney Involvement
- Cancellation/Commitment Fee
- Certificate of Release (of Mortgage)
- Joinder of Spouses
- Mortgage Tax
- Payment Customs
- Policy Countersignatures
- Real Estate Taxes
- Search and Examination Fees
- Search Requirements
- Security Instruments (Deed of Trust vs. Mortgage)
- Standard Exceptions and Requirements
- State-specific Policy Variations
- Title Insurance Form and Filing Regulations
- Transfer Taxes
- Withholding Taxes
- Witness Requirements
Please describe any requirements under applicable state law for attorney, abstractor or other special professional involvement, for example, in the search, examination, opinion of title, signing, closing, disbursement, recording, preparation of documents, and/or policy-issuance.
Title searches, examinations, closings and policy production are, ordinarily, performed by non-attorneys. Non-attorney title professionals are permitted to prepare form deeds provided that they are instructed to do so by a licensed realtor or attorney.
Does your state permit or require a cancellation fee or commitment fee upon cancellation?
State law does not prohibit, or require, the charging of a cancellation fee or commitment fee. The charging of such fees is permitted provided the underwriter’s filed rate manual contains a cancellation/commitment charge rate rule.
Certificate of Release (of Mortgage)
If anyone other than the lender (such as a title agent, settlement agent, underwriter or attorney) has the authority to release the security instrument, please describe.
A licensed title underwriter may release a deed of trust provided that it, or its agent, was responsible for the payoff of the subject loan. The underwriter release must be accompanied by an indemnification agreement in which the underwriter indemnifies the public trustee against any loss resulting from a deficient payoff.
Please describe the kinds of deeds that are customary for commercial and residential transactions. Please describe the kinds of deeds that are generally not insurable.
Residential sellers usually use a general warranty deed. Commercial sellers usually use a special warranty deed. Warranty deeds, bargain and sale deeds and quit claim deeds are insurable provided they do not contain a material deficiency (e.g., faulty legal description).
Joinder of Spouses
If a non-title holding spouse is required to join in the execution of a deed or a security instrument, please describe. Any analogous rights, such as those in a civil union or equivalent, should also be addressed.
A non-title holding spouse is not required to join in the execution of a deed or a security instrument unless he/she recorded a declaration of homestead. If a declaration of homestead is recorded, the title commitment must contain a requirement calling for the execution of the deed, and/or security instrument, by the non-titled spouse.
The Colorado Civil Union Act authorizes any two unmarried adults, regardless of gender, to enter into a civil union. The process of obtaining a license and later a civil union certificate is similar to obtaining a marriage license and marriage certificate. The effects of a civil union are far-reaching and many incidents and responsibilities under the law that are imposed upon or granted to married spouses will now apply to parties in a civil union. Most of these are unrelated to real property and title insurance but the bill does provide general statements that the rights and abilities concerning the transfer of real property that a married couple have would apply equally to parties to a civil union. There are similar provisions relating to probate matters and homestead laws. It appears that the current law relating to the dissolution of marriage would also apply to the dissolution of civil unions.
Is there a mortgage tax in your state? If yes, is it uniform across the state or does it vary? If it is uniform, please describe.
There is no mortgage tax in Colorado.
Who customarily pays for:
(a) Owner’s Policy?
(b) Transfer Tax & Recording Fee?
(c) Survey Charges?
(d) Closing/Settlement Fees?
Who customarily pays for:
(a) Owner’s Policy? Seller
(b) Transfer Tax & Recording Fee? Buyer
(c) Survey Charges? Seller or buyer per contract
(d) Closing/Settlement Fees? Seller or buyer per contract
What kinds of countersignatures, if any, are required to issue the policy?
The countersignature portion of the commitment and policy must be signed by a title licensee/individual resident producer.
Real Estate Taxes
Please describe the general tax year, due dates, and delinquency dates, including lien dates and payment cycle.
The general tax year extends from January 1 to December 31. Taxes for the previous year are due on January 1. If those taxes are not paid on or before June 15, they shall be deemed delinquent on June 16. The public auction of tax liens on lands upon which taxes remain delinquent shall commence on or before the second Monday in December of each year.
Search and Examination Fees
Is it permissible and/or customary to charge a separate search and/or examination fee, and under what circumstances? If your jurisdiction is all-inclusive, please state that.
The rates are all-inclusive. Thus, separate charges are not assessed.
Is there a minimum period of time for a title search required: (a) by state law, (b) pursuant to marketable record title acts, or (c) by any other applicable title examination standards (e.g., state bar association)? Please respond to each category. If a minimum search period exists for any category, please state it.
State law requires a search that will allow for “a reasonable examination of the title” and “a determination of insurability of title in accordance with sound underwriting practices for title insurance companies”.
Security Instruments (Deed of Trust vs. Mortgage)
Please describe the customary and permissible form(s) of security instruments used in your state.
Who can be listed as the trustee on the Deed of Trust (e.g., residency and/or natural person requirements, etc.)? Can an underwriter or title agent be designated as the trustee, and, if so, is it customary?
The customary instrument is the deed of trust. Ordinarily, the public trustee is listed as the trustee on the deed of trust.
Standard Exceptions and Requirements
Please identify the standard exceptions and requirements that are customarily used in your state.
Standard exceptions, shown below:
- Rights or claims of parties in possession not shown by the public records.
- Easements, or claims of easements, not shown by the public records.
- Encroachments, overlaps, boundary line disputes, or other matters which would be disclosed by an accurate survey and inspection of the subject property.
- Any lien, or right to a lien, for services, labor, or material hereto or hereafter furnished, imposed by law and not shown by the public records.
- Taxes or special assessments which are not shown as existing liens by the public records.
Additional standard exceptions include: 6. unpatented mining claims, reservations or exceptions in patents or in acts authorizing the issuance thereof; and 7. water rights, claims or title to water.
Ordinarily, requirements are customized depending on the circumstances affecting the transaction.
State-specific Policy Variations
If there are state-specific changes to the provisions in the ALTA policies (e.g., Arbitration, Minerals), please describe.
Title Insurance Form and Filing Regulations
Please describe the form and/or rate filing requirements, if any, related to policies and endorsements. Please describe any applicable rating bureau.
State law provides for a “file and use” practice in which rate schedules and rate rules must be filed prior to use. Policy forms, and other types of forms (e.g., commitment forms, endorsement forms), do not have to be filed.
Is there a transfer tax in your state? If yes, is it uniform across the state or does it vary? If it is uniform, please describe.
There is no state transfer tax. However, there are 11 municipalities that charge a transfer tax. Those municipalities are Aspen, Breckenridge, Crested Butte, Frisco, Gypsum, Minturn, Ophir, Snowmass Village, Telluride, Vail and Winter Park.
Is usury coverage available?
Usury coverage is available on loans where the interest charged does not exceed 45 percent. C.R.S. 5-12-103 (2012).
What are your state’s requirements, if any, with regard to withholding proceeds from a sale, similar to but not including FIRPTA?
If the seller is a non-resident, or a corporation that does not maintain a permanent place of business in the state, the withholding tax will be the smaller of 2 percent of the sales price or the net proceeds from the sale.
Are witnesses required on a deed or security instrument? If so, please describe.