Plain-English definitions for the terms you will run into when buying or selling a foothill or mountain home in Colorado. Jump to a section: Buying, Foothill and mountain properties, Selling.
Buying
- Buyer agency agreement
- A written agreement between you and your agent, signed before you tour homes. It spells out what the agent does for you and how they are paid. This became standard practice nationwide in August 2024.
- Transaction broker
- In Colorado, a broker who helps both sides complete a deal without advocating for either one. Colorado law treats a broker as a transaction broker unless you have a written agency agreement.
- Contract to Buy and Sell
- The Colorado Real Estate Commission approved contract used for most home purchases. It sets the price, the deadlines, and what happens if a deadline is missed.
- Earnest money
- A good-faith deposit you put down when your offer is accepted, usually held by the title company. It counts toward your purchase at closing.
- Inspection Objection Deadline
- The date by which you must tell the seller about problems found in your inspection. Miss it and you generally accept the property as is.
- Inspection Resolution Deadline
- The date by which you and the seller must agree on how inspection issues get handled: repairs, a credit, or a price change.
- Appraisal gap
- The difference between the price you agreed to and a lower appraised value. Your lender only lends on the appraised value, so the gap comes out of your pocket or gets renegotiated.
- Loan Termination Deadline
- The last date you can cancel because your financing fell through and still keep your earnest money.
- Title commitment
- The title company report showing who owns the property and any liens, easements, or restrictions on it. Review it before your title objection deadline.
- Closing costs
- Fees paid at closing on top of the price: lender fees, title insurance, recording fees, HOA transfer fees, and prepaid taxes and insurance.
Colorado foothill and mountain properties
- Metropolitan district
- A special taxing district that pays for roads, water, and parks in many newer Front Range neighborhoods, including parts of Castle Rock and Castle Pines. It shows up as extra mill levy on your property tax bill.
- Mill levy
- The tax rate applied to a property assessed value. Each district that serves a home (county, schools, fire, metro district) adds its own levy.
- HOA
- A homeowners association that sets community rules and collects dues. Ask for the budget, reserves, rules, and any planned special assessments.
- Expansive soils
- Clay soils common along the Front Range that swell when wet and shrink when dry. They can move foundations and slabs, so a structural or soils report is worth considering.
- Radon
- A naturally occurring radioactive gas. Much of Colorado has elevated radon levels, so testing during inspection is standard. Mitigation systems are common and straightforward.
- Well and septic
- Many acreage homes use a private well and a septic system instead of city water and sewer. Plan to inspect both and to check the well permit.
- Well permit
- Issued by the Colorado Division of Water Resources. Some permits limit use to inside the house, which means no lawn or livestock watering. Read it before you buy.
- Wildfire risk and defensible space
- Foothill and mountain homes often sit in wildfire country. Mitigated landscaping around the house can affect insurance availability and price, so get insurance quotes early.
- Short-term rental license
- Many mountain towns require a license or permit to rent a home short term, and some cap how many they issue. Check the rules before you count on rental income.
Selling
- Listing agreement
- Your written agreement with the brokerage that markets your home. It covers price, term, services, and compensation.
- Comparative market analysis (CMA)
- A pricing study comparing your home with recent nearby sales, active listings, and expired listings.
- Seller Property Disclosure
- The Colorado form where you disclose what you know about the home condition. Fill it out carefully and completely.
- Net sheet
- An estimate of what you walk away with after the loan payoff, commissions, title costs, and prorated taxes.
- Days on market
- How long a listing has been active. Rising days on market in a neighborhood usually signals buyers have more leverage.
- Pre-listing inspection
- An inspection you order before listing so there are fewer surprises after you go under contract.
This glossary is general information, not legal, tax, or lending advice. Contract terms and deadlines are set by your actual contract. Talk with your agent, lender, attorney, or tax advisor about your situation.