Purpose of the Colorado License Law
To protect the public of CO in re matters
Define Conway-Bogue
- Also tied to Rule F. (F stands for filling in)
- Allows a licensee to practice law by filling in standard contracts
Under Conway-Bouge, licensees must
- Be connected to the transaction
- Use standard and approved forms
- May not charge a separate fee for preparing docs
RESPA
- Real Estate Procedures Settlement Act
- Says that you cannot accept gifts or fees for referring vendors to others for services
- Affiliated business arrangement rules/forms (ABA)
- If you have an interst in a company that you are referring, you must disclose and have the client sign the forms
The title company
- Can only prepare closing statements, not legal docs (only attorneys)
- Act as a scrivener (recorder) of the re listing broker
Brokers are responsible for what with the title company?
- All docs produced by the title company
- Payment for the legal docs
Who must have a re license?
Anyone for who lists, leases, buys, exchanges, auctions, options, negotiates or sells for compensation
Requirements for licensing
- Complete 168 hours of education
- Pass (not just take) the exam
- US ID
- 18+
Why could you be investigated?
- False advertising
- Violating the CO Consumer Protection Act
- Failing to manage money/docs
- Failing to provide a settlement closing statement
- Not keeping docs for 4 years
- Paying an unlicensed person for work that requires one
- Dual contracting (loan fraud)
The commission must get a complaint in writing before it can be investigated?
True
When must a licensee disclose their license status immediately?
- If they have an interest in buying property
- If they are a principal in the sale of a property
- Must disclose in WRITING in any purchase contract in which they are a party
- When they are at an open house
The commission can audit a broker’s escrow account at anytime, without notice?
True
The commission can audit a broker’s escrow account at anytime, without notice, to verify what?
- Docs for 4 years
- No commingling of funds
- Provided all purchasers and sellers with closing statements
What is commingling?
Putting the broker’s funds together with a client’s funds in the same account
Commission cannot investigate?
- Ethics violations (that’s REALTORS)
- Disputes between brokers
- Criminal violations (that is handled by criminal courts and damages too)
The commission cannot do what before they get the written complaint?
- Can’t subpoena files or docs (bring into court)
- Can’t use lawsuits to obtain records
- May not take a firm’s records without cause
What 3 possible actions can be done after a complaint investigation?
- Dismiss bc of a stigmatized property (homicide, suicide, HIV/AIDS)
- Issue a letter of admonishment (warning): lowest level of disciplinary action - a letter will go to you and your employing broker, not the public.
- Send the complaint to the administrative law judge (doesn’t determine penalty, just if they broke the rules).
If the licensee is guilty of a complaint, the re commission does what?
- Imposes a fine not the exceed $2,500 for each offense.
- Censures (make public), suspend, or revoke license
- CAN’T charge damages or impose jail sentences
- Makes licensee records/status available to the public for inspection on the re comm. website.
Who can revoke a license?
The RE Commission (only entity that can)
