WHAT’S INSIDE

CAR CARHOF Legal Corner

Convention Celebrates When is a Sale
Celebrating 90 20 Years of Deemed Closed?
years - Mardi Gras supporting
Style affordable housing page 22
page 6-7 page 8

A publication of the Colorado Association of REALTORS®

colorado
THE

REALTOR® July 2010

legislative update:
What CAR is doing to protect my business.
pages10-12
Englewood, CO 80112
309 Inverness Way South

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DENVER, CO
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Table of Contents
President’s Corner...................................................................................3
Counsel Corner.......................................................................................4
CREC Annual Update FREE with Registration!.....................................6
Why Attend Convention?......................................................................7
CARHOF Celebrates 20th Anniversary in 2010....................................8
Legislative Update................................................................................10
Economic Outlook................................................................................14
What Has The CAR Political Survival Fund Done For Me Lately?.....17
News & Events.................................................................................. 18
Blog, Blog, Blog......................................................................................21
Legal Corner..........................................................................................22
The Facts about REALTOR® Property Resource.................................23

The COLORADO REALTOR® is published by the:
Colorado Association of REALTORS®
309 Inverness Way South, Englewood, CO 80112
(303) 790-7099 or 1-800-944-6550
FAX (303) 790-7299 or 1-800-317-3689.
EDITOR: Tyrone Adams, tadams@coloradorealtors.com
ADVERTISING/DESIGN: Monica Panczer, mpanczer@colorado- reprints.
realtors.com
The Colorado Association of REALTORS® assumes no responsibility for
return of unsolicited manu­scripts, photographs or art. The acceptance Ethics. To reach a CAR director who represents you, call your local
of advertising by the Colorado REALTOR® does not indicate approval
or endorsement of the advertiser or his product by the Colorado
Association of REALTORS®. The Colorado Association of REALTORS®
makes no warranties and assumes no responsibility for the accuracy
or completeness of the information contained herein. The opinions
expressed in articles are not necessarily the opinions of the Colorado
Association of REALTORS®.
This is a copyrighted issue. Permission to reprint or quote any material
from this issue is hereby granted provided the Colorado REALTOR ® is
given proper credit in all articles or commentaries, and the Colorado
Association of REALTORS® is given proper credit with two copies of any
The term “REALTOR ®” is a national registered trademark for members of
the National Association of REALTORS®. The term denotes both business
competence and a pledge to observe and abide by a strict Code of
association/board.

[page 2]
President’s Corner

Calling You to Action By: George Harvey

2010 CAR President

Your state leadership, volunteer members and staff continues to work

extremely hard on your behalf and have made a lot of progress in many
areas in 2010 that adds value to your membership.
I would like to especially recognize and Dorsey, your state PSF Chair, and me in
thank Rachel Nance, our Vice-President doubling our “Call for Action” participation!
of Public Policy and her team Ted Leighty
In addition to your participation in “Call
and Wes Parham for representing us
for Actions” we also need more Colorado
so magnificently when the Colorado
REALTORS® to pay their fare share and
legislature is in session. This year there
contribute to PSF. This is just as important
were 649 bills introduced. The volunteer
if not more as it allows CAR to lobby
Legislative Policy Committee chaired by
effectively on behalf the REALTOR® Party. If
Sunny Banka reviewed 56 bills related to
you haven’t done so already contact your
our industry and took 32 positions.
local association today and contribute.
We are particularly excited and pleased
The second item I’d like to discuss is our
with the passage of the Commercial Real
Washington, D.C. trip last month. Over 100
Estate Broker Commission Security Act
CAR members and staff met with Senator
House Bill 10-1288 that was initiated by the
Bennet, Senator Udall and several members
Colorado Association of REALTORS® and the
of our congressional delegation to discuss
Denver Metro Commercial Association of
issues that are important to you and our
REALTORS®. HB10-1288 provides a broker
clients. One is affordable and available
with the ability to record a lien for an
property insurance. Thirty-seven states
unpaid commission against a commercial
are affected by the inability to get flood
property which has been enhanced by a
insurance including Colorado. We need to
lease with a tenant produced by a broker.
solve this problem! We would particularly
This legislation took eight months of
like to thank Senator Udall for sponsoring
preparation and work to achieve this
SB 2919 and raising credit union lending
goal. We are extremely pleased Governor
caps which should bring some relief to the
Ritter signed this bill on the behalf of hard
commercial lending markets.
working commercial brokers who too often
have a tough time getting paid. Third, in 2005 the FHA was only providing
about 3 percent of all residential real
On a not so positive note I am disappointed
estate loans in the U.S. This year it is almost
to report to you that out of the 22,000
40 percent. We are asking Congress to
members of CAR that are sent “Call for
strengthen the FHA lending mortgage
Actions”, over 16,000 do not respond. It is
insurance program and making permanent
extremely difficult for us to get legislation
higher FHA loan limits.
that is pro-REALTOR® or beneficial to our
clients without your participation. A modest Fourth, CARHOF is 20 years old this year.
goal of half of our members responding to My theme this year is “Be a Go Giver”.
“Call for Actions” should be attainable. It Nothing could exemplify that better than
literally takes less than one minute and two our CARHOF program which in 20 years has
clicks on your computer. We know you are assisted affordable housing with almost
busy but we cannot promote your interests $7 million in grants. For me CARHOF is our
without your participation. Please join Amy ‘finest hour’ as a state association giving
Continued on page 14

[page 3]
Counsel Corner
GOOD NEWS: COLORADO
ADOPTS BROKER LIEN LAW
This column is a legal resource for local associations, local association
counsel, and REALTORS®.
For many years, commercial brokers have
lost commissions because the costs to
pursue litigation against a non-performing
building owner can be prohibitive. With
strong support of the Colorado Association
of REALTORS® (“CAR”), the Denver Metro
Commercial Association of REALTORS®
(“DMCAR”), and REALTORS® across Colorado,
the Commercial Real Estate Brokers Com-
missions Security Act (“HB-1288”) (“Broker
Lien Law”) was passed by the Legislature
and signed by the Governor. It will become
effective August 11, 2010. The Staff and
Leadership of CAR, DMCAR and represen-
tatives from the commercial brokerage
profession did a magnificent job to get this
bill passed over strong opposition. Our firm
was pleased to assist REALTORS®, DMCAR,
and CAR in drafting portions of the legisla-
tion and encouraging the Legislature and
Governor to enact the law.
The Broker Lien Law grants a lien right to a
licensed real estate broker when a building
owner fails to pay a leasing commission
owed pursuant to a written listing or written
compensation agreement between the
broker and that building owner or his agent.
The lien right applies only to commercial
properties, not residential, and only to lease
transactions, not sales. The lien may be re-
corded on the fee interest of the owner, and
if the owner still does not pay the commis-
sion, the broker may file a judicial foreclo-
sure to sell the fee interest to satisfy the lien.
If it becomes necessary for a real estate
broker to file an action to foreclose the
lien, the broker lien will not have priority
over prior recorded liens, mortgages and
encumbrances, including mechanics liens
that relate back to a date prior to the record-
ing of the broker’s lien. In other words, the
Broker Lien Law is subject to Colorado’s Race
[page 4]
By: Dick Clark
Notice Statute. CRS 38-35-109, and does not
replace it.
The new law includes protections for build-
ing owners.
•For example, if the property is conveyed
to a bonafide purchaser before the
Notice of Lien is recorded, the broker has
no right to a lien to enforce the payment
of a lease renewal commission. CRS 38-
22.5-103(3).
•Also, an owner may seek a knowing
waiver of the broker lien right by paying
consideration acceptable to the owner
and broker. CRS 38-22.5-103(2).
•Should a broker record an invalid lien,
the broker may be subject to penalties
and damages under Colorado’s Spurious
Lien Law. CRS 38-35-204.
If a broker records a valid lien, properly per-
fected under the statute, the building owner
can choose to file a corporate surety bond
or similar financial assurance in the district
court to get the recorded lien released. That
corporate surety bond or similar financial
assurance must be at least one and one-half
times the amount of the lien plus any costs
awarded in the case to date. If the judge
approves the bond, the clerk of the district
court shall issue a Release of Lien, which
shall be recorded on the property. In this
event, the remedy for the real estate broker
is not the lien, but rather a claim against the
surety bond or other similar financial assur-
ance. CRS 38-22.5-111.
The Broker Lien Law is new and there are
no court cases interpreting it. This means
that it is incumbent upon brokers to strictly
adhere to the requirements of the statute.
For example, this statutory lien right is
meaningless unless the broker satisfies the
Continued on next page
Lien Law from page 4
conditions precedent set forth in HB-1288
because this lien arises from statutory law,
not common law. In other words, to be en-
titled to the lien right, the broker must follow
the statutory process.
Here is an overview:
First Step: The broker must serve the Notice
of Intent to Record Notice of Lien on the
owner or the agent for the owner at least 30
days prior to recording the Notice of Lien. If
the Notice is served on the owner’s agent, a
copy of the Notice must also be served on
the owner of record by personal service or
by registered or certified mail, return receipt
requested. CRS 38-22.5-104(1).
Second Step: Either contemporaneously or
before serving the Notice of Intent to Record,
the Broker must send a written notice to the
owner requesting mediation and make a
good faith effort to mediate. The mediation
obligation terminates 30 days thereafter and
does not preclude the broker from recording
the lien if a settlement is not achieved. CRS
38-22.5-105 and 106(C).
Third Step: The broker must record the No-
tice of the Lien on the real estate at least 30
days after serving the Notice of Intent to Re-
cord Notice of Lien on the owner. However,
the Notice of the Lien may not be recorded
earlier than 90 days after the tenant takes
possession of the lease premises or 90 days
after the compensation is due, whichever is
later. CRS 38-22.5-106(d).
Fourth Step: Within 10 days following
recording of the Notice of the Lien, the bro-
R
othgerber Johnson & Lyons has more
than 30 years’ experience advising real
estate brokerage firms across Colorado
in commercial, residential, property manage-
ment, investment, leasing, industrial, resort,
and farm and ranch transactions.
From listing and commission issues to
licensing, regulatory and tax matters, we assist
with the legalities of brokerage needs.
Denver · Colorado Springs · Casper
[page 5]
ker must serve a copy of the Notice on the
owner or the owner’s agent. CRS 38-22.5-
107(1).
Fifth Step: Within six months following
recording of the Notice of Lien, the broker
must file an action to foreclose the lien and
must record a notice that such action has
been filed (Lis Pendens). CRS 38-22.5-107(2).
In situations where the listing broker has an
agency relationship with the owner, presum-
ably the listing broker would fall within the
definition of an “agent of the owner” in the
statute. 38-22.5-102(3). This raises the pos-
sibility that a cooperating broker (tenant’s
broker) would have a lien right if he or she
has a written compensation agreement with
the listing broker as “agent of the owner”.
However, no lien may be recorded by a
cooperating broker if the owner has paid
the listing broker the amount due under
the written agreement between the listing
broker and the owner, including any com-
pensation owed to the tenant’s broker. CRS
38-22.5-106(4).
Because of our familiarity with the new stat-
ute, we are presenting training for commer-
cial brokers on the statute, the lien right and
the process. Forms for the Notice of Intent
to Record Notice of Lien or for the Notice of
Lien are available through our firm.
Dick Clark rclark@rothgerber.com or 303-628-9531
(direct) is a lawyer at Rothgerber Johnson & Lyons LLP,
a regional law firm having a diversified practice in most
major areas of law from offices in Denver, Colorado
Springs and Casper. He and the firm have served as
legal counsel to CAR since 1990.
· Affiliated business · Licensing
arrangements · Listings and contracts
· Commission disputes and · Oil & gas leases
collections · Regulatory matters
· Environmental challenges · Tax matters
· Homeowners’ · Title issues
associations · Trials/appeals
· Insurance
Contact: Dick Clark - Kristin Bronson
303-623-9000
303-623-9000 · www.rothgerber.com
 Sponsored by:

CREC Annual Update FREE with Registration!

For 90 years Colorado REALTORS® have been coming together once a
year at the CAR Convention. The reason for coming together is to share
ideas, learn something new and make connections across the state – oh
and have some fun while doing so. Sure you can take classes online or
in your local area, but sometimes learning from people around the state
and country can open your eyes to so much more.

Here’s what you can expect at the 90th CAR
State Convention:
• Great classes – some for CE – including the
CREC Annual Update Course FREE with your
full registration.
• National Speakers Joe Malarkey and
Michael Kerr will keep you laughing while
you learn “The Upside of Down,” and
“Putting Humor to Work.”
• Mardi Gras Style fun including a Parade
and Bourbon Street Fun Night on Monday
evening.
*Technology Lounge by Metrolist to check
your emails
• New Broker/Owner Summit for those in
charge of real estate offices and personal.
This half-day Summit will be a great chance
to learn and network with your peers.
• Diverse exhibit hall with products and
services on show that you can use to help
your business flourish. Plus, short education
classes right in the hall on various topics.
• WIN! Two Grand Prizes from Metro Brokers
and tons of other fun stuff to win.

Register today at www.CARStateConvention.com

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[page 6]
Why Attend Convention?
The CAR State Convention is celebrating it’s 90th year and the simple
reason for its success is it is a one-stop shop for REALTORS® to stay on
top of the ever changing real estate market. Here are what some past
attendees have to say about the Convention:

“I believe so strongly in the benefits that one
gets from attending the CAR convention, that
I pay the registration fee for any of my Broker
Associates that attend. The knowledge they
gain help both themselves and the company.”
Greg Zadel – Firestone
“When I was studying real estate in college in the
late 70s, my real estate Professor Clyde Richey,
took all the real estate majors down to the
convention for the day. I think I have only missed
one convention since then. If you are serious
about staying at the top of your profession, you
need to be there. If not, stay home.”
Duane Duggan – Boulder
“I first came to the convention for the education.
I continue to come back for the networking,
catching up with friends from around the state
and to enjoy all the events.”
Robert Walkowicz – Fort Collins
Learn more and register at www.CARStateConvention.com
“As the Designated Broker in my office, I find
that the quality of education and networking
opportunities are tremendous. The setting
cannot be matched and of course, the
opportunity to meet some of the best in the
business certainly adds to the value and
importance of attending. I find that when my
agents make that extra effort to attend, they
always leave with so much more than expected.
I make it part of my business plan every year.
Not to mention, I always have a great time.”
Derek Camunez – Denver
“For me the convention is about inspiration from
start to finish. The endorphins kick in when you
start your day early with laughter and a message
and leave after two days inspired. It is fun to go
to classes with knowledgeable instructors, many
of whom are known across the nation for their
expertise, providing me with lessons to try to
minimize my weaknesses and stay current in this
fast changing real estate business world.”
Mary Ann Hinrichsen – Littleton

BROKER/OWNER SUMMIT
M O N D AY, O C T O B E R 1 8

NETWORK WITH OTHER

B R O K E R S A C R O S S T H E S TAT E
See what other leaders are doing to
make their real estate firm flourish.

LEARN FROM INDUSTRY

EXPERTS
With guest speakers like Dale Stinton
and Oliver Frascona you are bound to
learn something new you can use.

The Event for Colorado BRING YOUR TEAM

Broker/Owners! While you brush up on industry trends
and new laws make sure your agents
do to. Register your entire team today.

Register online and learn more at

WWW.CARSTATECONVENTION.COM

[page 7]
CARHOF Celebrates 20th
Anniversary in 2010

To donate to $20 for 20 years, visit www.carhof.org.

Mark your calendar! Tuesday, August 10, 2010 at Infinity Park Event Center, 4400 E.
Kentucky Ave., Glendale, CO 80246 from 11:30 am – 1 pm. CARHOF (Colorado Associa-
tion of REALTORS® Housing Opportunity Foundation) is celebrating 20 years of helping
the homeless, victims of domestic violence, first-time homebuyers, families’ threatened
with eviction or losing their homes, victims of a natural disaster and more in Colorado.
Come celebrate this accomplishment with us and our guest emcee Ed Green of CBS4 Den-
ver. More information about CARHOF’s 20 Year Anniversary and registration information
can be found at www.CARHOF.org.

$20 MAKES A BIG DIFFERENCE

In honor of CARHOF’s 20th Anniversary, you can donate $20 to help continue to fund safe,
decent and affordable housing for Colorado families and bring more smiles and comfort
to those who need a home. Make a $20 donation to CARHOF today at www.CARHOF.org.

CARHOF TAKES ON WORKFORCE HOUSING ISSUE

Through the generosity of an Ira Gribin Workforce Housing Grant from NAR, CARHOF is
tackling workforce housing issues in Colorado head on. CARHOF is making $100,000 avail-
able to nonprofit and employer housing programs that support workforce housing by
offering down payment assistance to help workers purchase homes in their communities.
More information about the guidelines and policies is available at www.CARHOF.org.

RE/MAX ALLIANCE, FIRSTBANK AND SNELL & WILMER L.L.P. – ARE PROUD SPON-
SORS OF CARHOF!
RE/MAX Alliance, FirstBank and Snell & Wilmer L.L.P. have signed on to become proud
sponsors of CARHOF’s 20th Anniversary Luncheon.

“We look at our business as much more than helping clients buy and sell homes. We
are also dedicated to helping families and show our commitment to the community
by supporting endeavors like CARHOF,” said Chad Ochsner of RE/MAX Alliance.

RE/MAX Alliance, the third largest RE/MAX franchise in the world and a name readily
recognized and respected throughout Colorado has participated for a number of
years in providing funds to CARHOF through their corporate and office escrow ac-
counts.

After nearly 50 years, FirstBank is fortunate to have financial stability, outstand-

ing employees, and great customers. They owe their success to their core values
a strong commitment to convenience, friendly and intelligent customer service,
and loyalty to our employees. “FirstBank supports CARHOF because like us they
strive to help meet the housing needs of Colorado residents,” says Lori R. Pohl, Vice
President FirstBank of Avon.

Jim Mulligan, a senior real estate partner at Snell & Wilmer L.L.P in their Denver
office, was privileged to have been involved in the original formation efforts for
CARHOF, serving on its original Board and advising the newly formed entity in

Continued on next page

[page 8]
 Supporting Affordable Housing in Colorado for 20 years!

its inaugural efforts for affordable hous-
ing. “The innovative and ground-breaking
activities of CARHOF have served Colorado’s
affordable housing community in unique
and meaningful ways, and have provided
a model nationally for other like-minded
organizations” Mr. Mulligan commented.
Snell & Wilmer is a Western regional full ser-
vice law firm of over 400 attorneys, of which
more than 40 are located in the Denver Of-
fice. The firm’s offices, in addition to Denver,
include Phoenix & Tucson, Arizona; Las
Vegas, Nevada; Salt Lake City, Utah; Orange
County & Los Angeles, California; and Los
Cabos, Mexico.
Come join Re/MAX Alliance, FirstBank and
Snell & Wilmer L.L.P. and other CARHOF
supporters at CARHOF’s 20 Year Celebra-
tion Luncheon on Tuesday, August 10, 2010
from 11:30am – 1:00pm. You can get more
information and register online at www.
CARHOF.org.

[page 9]
Legislative Update

MESSAGE FROM SUNNY BANKA

2010 CAR LEGISLATIVE POLICY COMMITTEE CHAIR

The 2010 Colorado Legislative Session brought forth numerous efforts

to modify local land use processes and curb growth. It was also marked,
again, by massive cuts in an effort to balance the budget.
The Colorado Association of REALTORS® (CAR) 2010 Legislative Policy Committee (LPC)
advocated against efforts to change local government land use authority, changes to
the rent control and warranty of habitability statutes, and negative impacts on the real
estate market in general. CAR also ran two pieces of legislation that both aimed to protect
our members’ hard earned commissions and sought to improve and enhance real estate
transactions during these tough economic times. Overall, CAR’s goal of maintaining an
environment that ensures our economic vitality were accomplished.
The CAR 2010 LPC Legislative Policy Statements, approved by the CAR Board of Directors,
established guidelines to support legislation which ensures economic vitality, provides
jobs and housing opportunities, preserves the environment, protects property owners,
and builds better communities.

Members of the LPC actively participate in various subcommittees to review and

recommend action on specific bills that fall into these guidelines. There were 39
active and committed REALTOR® members on the LPC this year – representing local
boards and associations across the state. Both commercial brokers and residential
REALTORS® were well represented.

As the gavel went down on May 12, 2010, in each chamber of the General
Assembly, CAR had actively reviewed 56 bills and took a position on 32 of
them. We accomplished much but there are still issues requiring our attention
between now and the 2011 session.

REALTORS® will most likely endure continued attempts to meddle with real
estate transactions and contracts, efforts to usurp local control of land use
decisions, and a renewed fight to redefine water rights for use by boaters
Continued on next page

[page 10]
Legislative from page 10
on Colorado’s rivers. It is absolutely crucial
that we strive to take proactive stances
on these and any other issues that are
important to us while continuing to be the
voice for real estate in Colorado.
Finally, CAR would like extend our deepest
gratitude to Representative B.J. Nikkel and
Senator Suzanne Williams for sponsoring
HB-1288. We are also extremely grateful
to Representative Tom Massey and
Senator Lois Tochtrop for sponsoring
HB-1133. Information on these bills can
be found below.There were also many
other legislators that deserve our heartfelt
appreciation for their dedication to
Colorado and REALTOR® interests. On behalf
of REALTORS® across Colorado – thank you!
HB 1288 – Concerning the Creation
of a Commercial Real Estate Brokers
Commission Security Act – HB 1288
permits real estate brokers who provide
tenants for commercial property to secure
payment for an unpaid commission
through the creation of a lien on
commercial property. Liens are permitted
if the broker has a listing agreement or
written compensation agreement in place
with the owner. Brokers are required to first
seek mediation of the dispute, give notice
of intent to file a lien, give notice when a
lien is filed, and commence proceedings
to close out a lien within six months
of recording a lien. The bill takes effect
August 11, 2010 and only applies to cases
in which a written listing agreement or
compensation agreement is entered into on
or after the effective date.
HB-1288 was a CAR initiated bill, and
one of our top priorities during the 2010
session. Too often, brokers experience
problems attempting to recover unpaid
commissions and are forced to spend a
considerable amount of time and money
in the courts to recoup their commissions.
In some instances, brokers were compelled
to forego pursuing their commissions
altogether due to the expense of a lawsuit.
CAR passed this legislation to provide
commercial brokers recourse for unpaid
[page 11]
earned commissions without incurring the
time and expense associated with bringing
a suit to recover these receivables. HB-
1288 places brokers on equal footing with
property owners and provides an incentive
to resolve any unpaid earned commissions
owed to brokers.
Position: Support
Status: Signed by the Governor
HB-1133 – Concerning Amendments to
the Colorado Foreclosure Protection Act
– The Colorado Foreclosure Protection Act
(CFPA) was established to protect Sellers
who are not in a position to protect their
selves. However, CAR found that the Act
has actually had the opposite effect. Buyers
subject to the Act in some instances would
not consider buying a property subject to
the Act due to the additional cost and risk
involved. Rather, Buyers were waiting until
the lender forecloses on a property and
then buying it from them directly – leaving
the Seller with the harm caused by the Act.
To rectify this problem, CAR successfully
ran legislation to improve provisions
within the CFPA that were having adverse
unintended consequences on sales of
distressed properties. These changes
include clarifying the definition of “Equity
Purchaser”, exempting short sales from the
CFPA where the Short Sale Addendum is
used, and modifying the foreign language
requirement to only mandate a notification
in the principal language of the seller
instead of drafting the entire contract in
their native language.
Position: Support
Status: Signed by Governor
SB 185 – Changes to the Warranty of
Habitability – The bill would have made
certain modifications to the residential
warranty of habitability for the purpose of
protecting renters. Specifically, it made the
following changes: written notice to the
landlord was no longer required prior to a
breach of the warranty, and the condition
of the premises that constitutes a breach
was modified; a county court, including a
small claims court, could have provided
Continued on next page
Legislative from page 11
injunctive relief related to a breach; and
local government notification was no longer
required prior to an injunction.
This bill would have undone several months
of taxpayer-funded negotiations between
stakeholders – of which CAR participated –
that took place less than two years ago, and
would have eliminated key components
that were negotiated to achieve a balanced
policy for all parties involved. Furthermore,
REALTORS® believe the requirement for
written notice of a breach of the warranty of
habitability is a fundamental protection for
both tenants and property owners.
Position: Oppose
Status: Postponed Indefinitely
HB-1188 – Concerning Clarification of
the Existing Right of Navigation by River
Outfitters – HB-1188 was an attempt to
clarify the existing rights of navigation for
guides employed by river outfitters and
the limitations of landowner liability for
damages. While the bill’s proponents claimed
that present law is unclear regarding the
scope of the existing right of navigation,
it has been established that rafters, and
other recreational water users, may pass
through private property as long as they
do not touch or otherwise use the private
land – we believe that is clear. Further, the bill
would have permitted “incidental contact”
and “minimum possible use” but did not
clearly define those subjective terms, leaving
stakeholders without a clear understanding
of whether or not a rafting company is
complying with the law.
The peaceful use and enjoyment of one’s
own property, and control of access, are
fundamental to recognized private property
rights. Some private land may be attractive
to rafters, but their desires do not justify,
and must not overrule, landowners’ more
fundamental rights. CAR expressed grave
concerns to lawmakers that the bill would
infringe upon such rights without just
compensation and encouraged legislators
to adopt the Senate version of the bill which
called for further study of the issue.
Position: Oppose
Status: Died in Conference Committee
[page 12]
HB-1017 – Concerning Voluntary
Agreements Affecting Rent on Private
Residential Property – This bill, introduced
on the recommendation of the state
Economic Opportunity Poverty Reduction
Task Force, authorizes certain public entities
to enter into voluntary agreements affecting
rent on private residential property. Current
law prohibits counties and municipalities
from enacting any ordinance or resolution
that would control rent on private residential
property. The bill authorizes agreements
to specify how long a private residential
housing unit is subject to its terms, whether
a subsequent property owner is subject
to the agreement, and remedies for early
termination.
REALTORS® facilitated amendments to this
legislative effort to expand the authority of a
local government with regard to rent control.
Due to the amendments, local governments
may not deny an application for a
development permit because an applicant
declines to enter into an agreement to limit
rents on any of their private residential
housing units. CAR still maintains that
voluntary agreements do not need the force
of law and will continue to monitor any
attempts to circumvent or amend Colorado’s
prudent prohibition on rent control policies.
Position: Oppose
Status: Signed by Governor
BACK TO
THE LAND!
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the ALC.
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our top rated
education
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Find us at
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Introduce your clients to ENERGY STAR® homes, and closing is only a showing
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© 2010 Xcel energy Inc.

Economic Outlook
What Will Spur 2010s Market and How to Take Advantage of It?
by: Henry Springs
April 30, 2010 has come and gone. That was
the deadline for the extended and expanded
federal tax stimulus program for first-time
and move-up homebuyers. The stimulus
was part of the government’s solution to
a scourge of declining prices, decreased
home sales, increased foreclosures, and the
evolution of short sales. It has also been
reported that there is $64 billion worth of
ARM’s set to default in 2010; however there
is a silver lining to the gray cloud.
“The tax incentives were “intended as
temporary assistance,” says George Harvey,
President of the Colorado Association of
REALTORS®.
According to Michael Welk president of the
Jefferson County Association of REALTORS®,
pre-foreclosures and short sales make up
about 40 percent of the market. He also said
there’s just a month’s supply of inventory
for homes under $200,000 and future short
sales will depend on the REALTOR®’s ability
to negotiate a good deal. “Focusing on “a
niche market,” continuing education, social
media and old fashion networking will be
major factors in improving business,” says
Welk.
April sales in metro Denver rose 22.5 percent
to 3, 362. Sales for the first quarter were
up one percent. REALTORS® are waiting for
the market to fully recover, paying close
attention to changing conditions that
will translate into opportunities. This past
May Welk saw increased activity in metro
Denver’s varied market from using Craigslist,
social media, Facebook, and stealth pages
to list and connect buyers with good deals.
First-time buyers called toll free numbers
without REALTOR® representation. They
responded on their own and in some cases
he’s received multiple offers.
Spring’s arrival in Colorado typically
means more showings, more inquiries,
and anticipation of more home sales. To
help keep the momentum going some
[page 14]
homebuilders are offering advertised
discounts called Uncle Sam incentives for as
much as $8,000 off the asking price.” Welk
feels baby boomers will seek better deals
on condos and falling prices in resort and
recreational areas like Summit and Eagle
counties.
According to Harvey becoming a specialist
in an area such as SRES (Seniors Real Estate
Specialist), RSPS (Resort and Second Home
Property Specialist) and/or CRS (Certified
Residential Specialist) to name a few will
give members an advantage. NAR Second
Home Consumer Profile says the 87 million
baby boomers are “the single biggest
purchasers of move up and second homes.”
Harvey feels the market in resort areas and
move up properties will be much better in
the coming year.
One of the practices Harvey uses to help
drum up business is through his website.
He connects to a variety of related links for
interested buyers: charities, special events,
restaurants, vacations, and hotels. His
website was designed under the general
concept that “prospective buyers want
to learn everything they can about the
market and 80 to 90 percent of online
buyers viewing houses will connect to his
site through related links.” He sends out
notifications for a “Best Buy of The Week” to
70 or more frequent users and advertises to
another 1,000 people who eventually end
up on his first list.
Both of these REALTORS® agree that while
the housing market is showing signs that it
could be moving up, the best strategy you
can have in a changing market is to change
with it. If you are not happy with where you
are in your current business model you have
to do something different to get different
results.
Get the Single Source® advantage

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Wells Fargo Home Mortgage is a division of Wells

Fargo Bank, N.A. © 2010 Wells Fargo Bank, N.A.
All rights reserved. AS268487 5/10-8/10

[page 15]
 Invest in Your Future – Invest in PSF!
NAR Presidents Circle
($1000 min. to PSF and $2,000 to National Political Parties and/or NAR-Selected Federal Candidates)

Kit Cowperthwaite Joe Divito Amy Dorsey Michael Marcus

2010 Investors - Updated 6/15/10

Scott Matthias Chris McElroy


Ron Myles Bill Osnowitz Bonnie Smith Debbie Tamlin Kay Watson

Golden R - $5,000+

Bonnie Smith Kit Cowperthwaite Amy Dorsey Scott Matthias Ron Myles Kay Watson

Crystal R - $2,500+

Mark Donahue Michael Marcus

Sterling R - $1,000+

Joe DiVito Erika Doyle Jack Fox Gregory Geller Bob Golden Wynne Palermo

Bobbi Price Greg Zadel

Patriot Club - $500+

David DeElena - Tammy Elley - Gretchen Faber - Jay Gupta - Aaron Lebovic - Mary Wolf

Capitol Club - $250+

Donate Online at www.ColoradoPSF.org
Steve Baker - David Barber - Edward Behr - Deborah Conner - Robert Cope - Russell Desalvo - Amanda DiVito Parle - Bruce
Gardner - Gary Glenn - William Hurt - Prue Kaley - Keith Kanemoto - Thomas Kenyon - Robert LeGare - Jill Limberg - Cheri
Long - Alan Lovitt
Presidents from- Nancy
pageMcBride
3 - Kelly McKinnis - Charles Miller - John Mitchell - Gary Morton - Dan Murphy - Linda
Philpott - Nicole Pinette - Randy Reynolds - Jolon Ruch - Ulrich Salzgeber - Sandy Trujillo - Lori VanDerWege

$99toClub
back the communities we live in. memories in our 90-year history that
John Ahroon - E.S. , Al Alba - Derek Andersen - Kristine Anderson - Ryan Andre have taken
- Ryan Anslynplace
- SuzanneinAnton
this -beautiful
Barbara Asbury facility.
- Amy
Wouldn’t
Aschenbrennerthis - Boydbe Kellya Bailey
great year Bancroft
- Kathryn to make your
- Sunny Banka - Shelleen Baraldi - Phillip Barker - Scott Beasley - Janene Bettin - Wendy
Please come celebrate with us and if you
contribution
Bibeau - Tara Bostonto CARHOF?
- Jack Bradbury - Lois Bradbury - W R Bray - Robert Bray - Bob Brown - Connie Bruce - Dale Bugby - Jeffrey Burke - James
Button - Sherrill Carter - Judy Carty - Cheryl Chandler - Rosalinda Chaney -have Denise never
Chirafisi - been to the
Carolyn Cizek Broadmoor
- Patricia Clark - Barbarayou
Cline - Judy
Coffey - Kathrine Cole - Steve Conder - Wendy Conder - Richard Corbin - Joan
Lastly, it is with some sadness and some must
Cox -plan
Stevento attend
Cramer this event.
- Bart Cuomo It is- truly
- Ronald Curry Richard Dana
- Robert Danos - Paul Dart - Sherilynn Dickinson - Cheryl Dingwell-Keckritz - Christopher Doyle - Floyd Duffy - Caroline Duffy - Duane Duggan
joy that
- Robert I invite
Dullinger - Dana youDuncanto -the CAR
Deanna DyerState
- Lynn Emmert - Kim Enomotoone -of the most
Theodore special
Errico - Doreen REALTOR®
Eubank State- Susan
- Kathleen Everett
Ewing - Joan Falce - Wanda Ferguson - Cherri Fischer - Matt Fitzgerald - Anne
Convention at the Broadmoor in October. Conventions
Marie Flynn - Saulin all of
Forster theFyff
- Dessel U.S. LearnGaulke
e - Modene more at
- Ronald
Gilley - Brenda Givan - Tracy Gosar - Carol Grape - William Greer - Sue Ellen Grimaud - Gregory Hahn - Susan Haley - Gene Hall - Denese Hansen
This may
- Jonathan be the
Hartman - John last convention
Hauschild at the
- Karen Hermelink - Michael Hixon - www.CARStateConvention.com.
Judy Hoffschneider - Emilie Hogy - Lee Holfeltz - Nancy SeeHollen
you- Linda
Broadmoor
Hopkins - Ken Hotard and surely
- Perry Hotz - will be for the
Wini Hulterstrom next
- Janet Hummel - Juliethere!
Hummel - Diana Hutton - Leeann Iacino - Stephanie Iannone - Cheryl
James - Michelle James - Dennis Johnson - Janene Johnson - Deb Jones - Edwin Kanemoto - Jan Kanemoto - Lois Kaplan - Aileen Kato - Sandra
three
Kauffmanyears. There
- Joan Kenyon areKersting
- Julie many wonderful
- Pamela Kiker - Nathan Klein - Angie Klepper - Margaret Kobobel - Randall Kohn - Michael Kozlowski
- Eric Kronwall - Linda Lafferty - William Lamoreux - Doug Landin - Michael Landreth - Joyce Lang - Sabrina Lee - Karen Levine - Brian Lovett -
Walter Lucy - Donald Luehring - Kevan Lyons - Steven Macdonald - Michael Madsen - Donald Markley - Jack Mason - Diana Mathias - Robert
McCormick - Gerald McFarling - Mike McGinnis - Gerald McGuire - Charles McNeal - Terry McNeal - Amber Meadows - Verna Melgares - Terrie
[page 16]
Mittelstadt - Janice Molitor - Lisa Mooney - Charles Moore - Steve Morgan - Randy Moser - Eric Mott - Paula Mulhern - K. Lynn Myers - James
Neely - Barbara Nelson - Sharon Newman - Wayne Newsom - John Nichols - Caroline Nordyke - Jack O’Connor - Mary ODonnell - Anne Marie
 

What Has The CAR
Political Survival Fund
Done For Me Lately?

Do you know what PSF has done for you lately? As a Colorado
REALTOR®, I hope you do because we are the most effective
voice for you in the State Capitol.

AMY DORSEY, PSF
FUNDRAISING CHAIR

My team at CAR and I work every day to make sure our Legislature and state regulatory
agencies are passing laws and regulations that create a healthy business environment for
all our hardworking members like you as well as making sure homeownership remains
accessible to Colorado families.

Given the state of the economy we redoubled our efforts over the last eighteen months


to make sure that our elected representatives are not taking actions that will impede the
rapid recovery of Colorado’s real estate market. This has meant fighting against a bevy of
proposed costly, new regulations. As every REALTOR® knows, now is not the time to make
the buying and selling of a home more costly and arduous by adding new fees, paperwork
and regulations.

I am happy to report that there were a number of victories during the most recent
legislative session. With your support we were able to:
• Enable brokers to place liens on property for unpaid commissions
• Stop a multitude of efforts to deter growth and property investment
• Enable new provisions to protect an individual’s right to freely own and transfer property
• Improve the Colorado Foreclosure Act to make short sales and foreclosure sales easier
• Stop local government from denying development permits for owners not supporting to
rent control
• Stop private boaters and rafting companies from accessing private property without the


owner’s consent

With election season upon us, we need your support more than ever. You can invest in PSF
online at www.ColoradoPSF.org today!

COLORADO CRS CHAPTER #1

Upcoming Classes
Sept. 30th - Oct. 1st – CRS 210 – Referral Course
Grand Junction Area REALTOR® Association Why Become a CRS?
Oct. 14th-15th – CRS 201 – Listing Course
• CRS Designees earn a median income of $85,000 annually,
Glenwood Springs Board of REALTORS®
nearly 3 times the $29,400 median income
All courses are $300 or $275/ Chapter Members. of REALTORS® serving as sales associates.
(Source: 2009 NAR Member Profile)
Upcoming Networking For Referrals:
Sept. 30th – Grand Junction • CRS Designees average a total of 21 transactions
Oct. 14th – Glenwood Springs per year with gross sales of $3.2 million.
Course descriptions & registration at www.ColoradoCRS.com or call 303-582-5617.

[page 17]
NEWS
EPA DELAYS ENFORCEMENT OF NEW
LEAD PAINT RULES
&
The Environmental Protection Agency (EPA)
has delayed the enforcement of the new
Lead: Renovation, Repair and Painting rule
to provide time to get more remodelers and
other contractors trained - and for EPA to
get the word out to consumers about the
importance of hiring a certified remodeler,
according to the National Association of
Home Builders (NAHB). While remodelers,
electricians, heating and air conditioning
technicians and other contractors must
adhere to lead-safe work practices, includ-
ing special equipment filters and a ban on
open flames, EPA will not take enforcement
action against firms that have been unable
to obtain certification until Oct. 1 of this
year. For more information about the Lead
Paint rules go to www.EPA.gov.
2011 CAR OFFICER POSITIONS ELECTION
RESULTS
The following are your elected CAR leader-
ship from the Special Election that was held
Thursday, June 10, 2010.
President President-elect
Randy Reynolds, Scott Matthias,
Pikes Peak South Metro Denver
Treasurer Immediate Past
Sunny Banka, Aurora President
George Harvey,
Telluride
[page 18]
EVENTS
District V.P. Elects
Metro District- David Barber
Mountain District- Mark Ronay
Northeast District- Gary Maggi
Northwest District- Christi Schmidt
Southeast District- Alan Lovitt
Southwest District- Pam Eaton
NAR Directors
Kit Cowperthwaite (3 year term)
Bonnie Smith (3 year term)
George Harvey (1 year term)
ENTER COLORADO GOOD NEIGHBOR
PROGRAM AND WIN $1,000
CAR is now accepting nominations for
CAR Good Neighbors. We are looking for
Colorado REALTORS® who are making a dif-
ference in their community in an extraor-
dinary way. Nominate them today for one
of four CAR Good Neighbor Awards that
will be presented at the CAR State Conven-
tion October 17-19, 2010. Each winner will
receive a donation of $1,000 to the charity
they submitted. Go to the “useful info” tab at
www.ColoradoREALTORS.com to review the
criteria and fill out the application. Deadline
to enter is Friday, August 27, 2010.
FANNIE MAE AND FREDDIE MAC FREEZE
PACE LOAN PROGRAM
Two of the biggest buyers of home mort-
gages in the nation Fannie Mae and Freddie
Mac have put on hold for 60 days the
popular PACE (Property Assessed Clean
Energy) loan program as concerns continue
to rise regarding homeowners and busi-
nesses receiving upfront money to make
their property (residential and commercial)
energy efficient and/or to purchase renew-
able energy systems. The hold only affects
applications for residential loans. It does
not affect commercial loans.
continue on next page
The loans are repaid in 15 to 20 years by the
borrower, however with the default rate on
loans still high there are concerns about
getting mortgages repaid if homeowners
have gone through the PACE program and
later default on their mortgages.
Over 20 states have adopted this program
that started in Boulder County. In Colorado
three other counties Gunnison, Pitkin and
Eagle are starting energy efficient programs
with a statewide effort on the horizon this
year.
NAR DIRECTORS PASS SEXUAL-ORIENTA-
TION PROTECTIONS
The NAR Board of Directors passed a
change to Article 10 of the Code of Ethics
barring REALTORS® from denying equal pro-
fessional services on the basis of sexual ori-
entation or from discriminating against any
person on the basis of sexual orientation.
Standard of Practice 10-3 was amended as
well to prohibit discrimination on the basis
of sexual orientation in any advertisements
for selling or renting property. The Code of
Ethics change must still go before the NAR
Delegate Body for approval at NAR’s annual
conference in November.
REALTOR® PROPERTY RESOURCE (RPR)
WHAT IS IT?
Upon completion, the REALTORS® Property
Resource will contain deep information on
every property and parcel of land in the
country. About 1,000 NAR members are
testing the RPR software in 12 markets,
said RPR CEO Dale Ross. Members are also
testing the applications that will deploy the
data on handheld devices. Once testing is
competed, the 12 beta markets will be the
first when the database is rolled out. NAR
continues to buy and license the public re-
cord data that will comprise the core of the
database. The goal is to overlay all that data
with data from MLSs. Ross emphasized that
RPR will not license or syndicate MLS data.
The information will be used solely for cre-
ating deep analytical reports - the hallmark
of the product - for use by REALTORS®. Full
roll-out is expected to take five to six years.
[page 19]
YPN SEEKING MEMBERS
Are you interested in networking with
young professionals that are a part of a
growing group of young, career-minded
real estate professionals? Join the YPN
(Young Professional Network) group. This
upstart group stays abreast of the latest
tools, resources, and networking opportu-
nities. More information about the Young
Professional Network can be found at www.
ColoradoREALTORS.com.
CAR UPGRADES COLORADOREALTORS.
COM EDUCATION CALENDAR
Check out CAR’s new education calendar
on ColoradoREALTORS.com. This more user
friendly calendar has education informa-
tion from local associations/boards across
the state. You can view the calendar by
day, week, month or even a year. Go to the
“education tab” at www.ColoradoREALTORS.
com and register for a class near you.
PERFORMANCE LEADERSHIP: ATTRACT,
DEVELOP & KEEP SUCCESSFUL SALES
ASSOCIATES
This course will be held at the Denver Board
of REALTORS® July 22&23 and will help you
understand different leadership techniques
and how to apply them to real world situ-
ations. At the end of each module, you will
construct a key part of your overall sales
leadership plan.
Learning Objectives:
• Better define your company’s success
factors to maximize recruitment & reten-
tion
• Create a career development program
so agents can reach their full potential
• Learn to customize your leadership ap-
proach based on the individual and the
unique situation
• Sharpen your coaching and mentoring
skills and learn to hold people account-
able
• Develop a strategy to recruit, develop
& retain successful agents aligned with
your company’s culture
Who Should Attend? Managers, brokers,
owners, team leaders or anyone responsible
for their company’s business results. Regis-
ter under “Education” tab at www.Colorado
REALTORS.com.
continue on next page
12
money
ways to save
Take advantage of the following
discount programs as a CAR
member.
American Furniture Warehouse:
AFW will discount $25 for each $100
closing gift card purchased by CAR
members up to a $500 gift card.
United Car Care CDV provides
mechanical repair protection
insurance for $400 off to members.
CO Alarms: Purchase high quality
Carbon Monoxide alarms in bulk at a
discounted rate.
CREC Contracts: Agent Form
Manager real estate contract software
is available to CAR members for only
$50 for a 12-month license.
iHOUSEweb: CAR Members get
half off the startup fee on any of their
products.
Health Insurance for CAR
Members: Nicholas Hill Benefit
Group, Inc., is proud to offer you
their specialized service created to
assist REALTORS®.
Mongo Fax: Send Faxes to emails for
FREE.
Nationwide: CAR members can
receive a special discount on auto
insurance from Nationwide®.
T-Mobile: CAR members can take
advantage of several discounts.
UPS Overnight: Save on overnight
shipments from UPS.
RMD Signs: CAR members receive
discounts on sign merchandise.
3bx: Search a nationwide list of
buyers for FREE.
Learn more at the “Useful Info” tab at
www.ColoradoREALTORS.com
[page 20]
News from page 20
WMRA URGES NAR TO ADDRESS CONDO
FINANCING ISSUES
The Western Mountain Resort Alliance (WMRA)
is strongly urging the National Association of
REALTORS® (NAR) to advocate on their behalf
of condo financing issues. This group com-
posed of boards of REALTORS® of destination
ski resorts in the Mountain West in Colorado,
Utah, California, Canada, Idaho and Montana
are becoming increasingly concerned about
the difficulty of obtaining financing in con-
dominium transactions in their resort areas
due to strict Fannie Mae & Freddie Mac condo
guidelines. According to the group, the condo
markets in their areas have been particularly
hit hard by the housing downturn. The current
guidelines have made it almost impossible for
condo transactions to be completed, even for
buyers with strong credit and healthy down
payments.
For more information about WMRA Condo Fi-
nancing efforts contact Dennis Hanlon, WMRA
Chair, at 435-640-5851 or Sarah Thorsteinson,
Government Affairs Director for the Glenwood
Springs Association of REALTORS®, Steamboat
Springs Board of REALTORS®, Summit Associa-
tion of REALTORS®, and Vail Board of REAL-
TORS® at 970-393-3939.
Exit Right Choice Realty
• No desk fees
• 80/20 split for the first year
• $375 Transaction fees
• 24/7 online training
• and much much more!
Call Laura at 303-799-9909
www.ExitRightChoiceRealty.com  
BLOG, BLOG, BLOG

Read what some of your colleagues are saying about

questions that are posted on various blogs about real
estate. Names are being withheld to protect the in-
nocent.

Question:

My seller wants more exposure, more showings.

Any creative ideas for getting a listing more at-
tention (the $100,000 question) and showings? I
already have a gift card drawing in place.

Top Five Answers:

• Do your homework for your client and keep it priced

competitively with supporting documentation. De-
termine your target demographics. Market the property on internet sites, through social
networking, email, and any hard copy that is useful in your area.

• Possibly advise clients on the activity on some of the major internet sites every other day
rather than just weekly summations... Be creative and step out of our comfort box at times
is good for everyone including us.

• Price, Price and Price. Today’s, buyers are looking for the price! Hire an Appraiser find out
what it is really worth and then price accordingly. Certainly a major part of the equation is
your sellers’ timeliness issue for when a sale is expected.

• We do 6 small price drops ( 500 or 1000) so it goes out on the hot sheets and stay in front
of Buyers set up on auto emails 6 weeks in a row! This has been working really well. We go
over it at the listing appt and put it right in the listing it starts after 30 days on the market.

• Most importantly, keep your client informed on a weekly basis with buying & selling pat-
terns for their neighborhood and your town plus statistics of their property viewings from
Realtor.com. This is still a people business so keep the telephone lines open.

Blog Blog Blog is for informational purposes only.

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[page 21]
Legal Corner
WHEN IS A SALE DEEMED
“CLOSED?”
Consider a transaction scheduled to close
on Wednesday, June 30, 2010, attended by
both buyer and seller. The seller signs all of
the seller documents, including the deed,
which is tendered to the closer for record-
ing. The buyer signs all of her documents
and tenders her down payment. Though
the buyer’s loan has been approved, the
wire from buyer’s lender doesn’t arrive
on Wednesday, so the parties execute an
escrow agreement authorizing the closer to
hold the closing documents until the hoped
for arrival of the lender funds on Thursday.
The wire does arrive on Thursday. Did the
deal close on Wednesday?
Does it make a difference if the escrow
agreement provides that if the wire doesn’t
arrive on Thursday, the seller gets to keep
the buyer’s earnest money? What if the
escrow agreement provides that if the wire
is late, the contract terminates and the
buyer gets her earnest money back? What if
the escrow agreement doesn’t address what
happens if the wire is late? What if there is
no escrow agreement?
In a different example, the buyer has signed
all the buyer documents, and all the funds
on the buyer’s side (e.g. the earnest money,
the down payment and the borrowed
funds) are in the closer’s account by
Wednesday. One of the two sellers has
signed all the closing documents for
both sellers, including the deed, which
has been delivered to the closer for
recording. The signing seller has au-
thority to sign on behalf the absent
seller through a power-of-attorney.
The absent seller signed the power-
of-attorney in Chicago and faxed
a copy to the closer which she re-
ceived on Wednesday morning. The
closer declines, however, to disburse
the seller’s proceeds to the seller,
or the deed for recording, until the
original power of attorney arrives
on Thursday. Did this deal close on
[page 22]
By Jon Goodman and
Jordan Bunch
Wednesday or Thursday?
For the vast majority of residential real
estate transactions, there are few disputes
about the timing of closing. The best way
to avoid the uncertainty is to unambigu-
ously get deals closed prior to the relevant
deadlines. We are not, however, in control
of all of our transactions all of the time. Tar-
dy parties might want to push the envelope.
Despite the skill and best intentions of the
stakeholders, there are some situations for
which the precise timing of the closing is
important and ambiguous.
There are no hard and fast rules about
when a real estate transaction is “closed” for
tax purposes. Absent delivery of a deed, a
transaction is “closed” when the benefits and
burdens of ownership pass from the seller to
the purchaser, yet it is not always clear when
this happens.
The question must be resolved by an exami-
nation of all of the facts and circumstances,
no single one of which is controlling. When
legal title hasn’t yet passed, courts seem to
consider a half dozen or so factors, some of
which are discussed below.
The court in Keith v Commissioner held
that the benefits and burdens had passed
to the purchaser because the purchaser
had possession of the property, the duty
to pay property taxes, the duty to keep fire
insurance, and the duty to maintain the
property. The more concrete an agreement
is, the more likely it will constitute a closed
transaction. In the first example above, an
escrow agreement that extends the closing
date and that lets the buyer off the hook if
the wire doesn’t arrive on Thursday protects
the buyer’s earnest money, but it decreases
the likelihood that the transaction would
be considered closed by Wednesday. An
escrow agreement that doesn’t extend the
closing date and provides that the buyer is
in default on the contract if the wire doesn’t
arrive puts the buyer’s earnest money at
continue on next page
risk, but increases the likelihood that the
transaction closed on Wednesday. Buyers Celebrate 90 Years!
should rely on their attorneys, not their real
estate brokers, to balance these tradeoffs.
at the CAR Convention
October 17-19, 2010
In Dettmers v. Commissioner the court www.CARStateConvention.com
recognized that an executed escrow agree-
ment was not enough to close a sale. The
purchaser executed an escrow agreement
that established “the purchase price of the
property, the terms of payment, rate of inter-
est and other terms and conditions of sale”
and made a down payment on the property.
The court held, however, that the benefits
and burdens of ownership did not pass to
the purchaser at that time. Instead the court
held that the sale closed when the “agree-
ment became fully executed with title and
possession of the property passing” to the
purchaser.
The second example at the beginning of this
article presents a more compelling case for
a Wednesday closing than the first example.
In the second example, the signing seller
who is the “attorney-in-fact” for the non-sign-
ing seller had actual authority to sign the
deed on behalf of the non-signing seller on
Wednesday. There is written evidence of this
authority at the closing via the faxed copy of
the power of attorney. The closer, however,
waits for the original power of attorney from
the seller to record together with the record-
ing of the deed. In the first example, the
buyer was a day late with his funds (perhaps
due to no fault of the buyer). In the Colo-
rado case Kaiser v. Wright, the seller could
not produce statements from lien holders
that they would release their liens upon their
receipt of the net proceeds of the sale, how-
ever the seller produced such statements
after closing. Relying in part upon “time is
of the essence” language in the contract, the
Colorado Supreme Court concluded that the
seller failed to timely close.
If the precise timing of a closing is important
to a party, he or she should strive to avoid
ambiguity. If the precise timing of the clos-
ing is important and ambiguous, the parties
should work with their lawyers to evaluate
and manage the ambiguity.
Disclaimer–Content is general information
only. Information is not provided as advice for
a specific matter, nor does its publication cre-
ate an attorney-client relationship. Laws vary
from one state to another. For legal advice on
a specific matter, consult an attorney.

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