Buying a new Home without a Real Estate Agent in Colorado

Are you thinking about buying a home? Have you ever wondered what the process would look like without an agent? If you even need one? Between 2014 and 2022, median housing prices in Colorado have skyrocketed 153%, far outpacing the national average. With the rising costs of homes, that also means that the cost of hiring a real estate agent have risen tremendously. Many buyers and sellers have chosen to forego the agent altogether. An experienced real estate attorney can help explain the complicated process of buying a home, prepare an offer that complies with Colorado’s statute of frauds, review the seller’s disclosure and inspection, and establish a preexisting relationship in case an issue arises where time is of the essence.

How much more work is buying a home without the help of an agent?

The process is generally the same for purchasing a home with or without an agent, the difference is the expertise you have available while going through the process. The first step, coming to an agreement on the material terms like price, earnest money, financing requirements, and other issues like appraisals, inspections, surveys and contingencies; then distilling those terms into the Colorado Real Estate Commission (CREC) approved form; and finally finding the right title company.

Agents can help with the negotiation and filling in the blanks. However, licensed real estate attorneys have the ability to practice law in addition to being able to help negotiate. The experience of an attorney can help personalize the standard CREC contract to uniquely fit your situation. Many attorneys have seen the pitfalls of how and why a purchase agreement goes bad, most of these issues are extremely time sensitive. Scheduling a one hour consultation with GLO can ensure peace of mind in one of the largest purchases in your life by customizing your contract and establishing a relationship, without an outrageous retainer, before any potential problems occur.

If I am buying my home without an agent, why do I need a real estate attorney?

Even though you may not need an agent, you should still hire an experienced real estate attorney for three reasons: (1) a real estate attorney can ensure you get the deal you want, (2) a real estate contract is a complex legal document, and (3) hiring a real estate attorney in lieu of an agent is far less expensive than hiring a realtor.

First, a real estate agent is limited in what they can do. Real estate brokers typically charge a 3% commission on the sale price of the property. Imagine a home worth $500,000; an agent’s fee would be $15,000! In addition, other than providing some non-legal services such as finding buyers or sellers, a real estate broker can only draft a real estate contract using the CREC form. A real estate lawyer can help you draft the contract as well as make significant addendums or additional clauses that go beyond the CREC form. This way, your attorney can ensure you get the deal you want.

Second, a real estate contract is a complex, legal document—even if you use the CREC approved form. The CREC even states a warning at the top: “THIS FORM HAS IMPORTANT LEGAL CONSEQUENCES AND THE PARTIES SHOULD CONSULT LEGAL AND TAX OR OTHER COUNSEL BEFORE SIGNING”, and section 19 is entirely dedicated to the “RECOMMENDATION OF LEGAL AND TAX COUNSEL.” There are many things involved in the purchase of a home that are unfamiliar, such as title insurance, what disclosures are required by Colorado law (e.g., lead paint), property inspections, transactional paperwork, closing obligations, and negotiations.

Third, hiring a real estate attorney will save you more money in the long run—not only because they are less expensive than a broker, but they can also help you avoid liabilities down the road and walk you through the tax considerations implicated in buying a home. Without the assistance of an agent, buyers should seek help with the contract, title, and closing to ensure an effective process.

How can GLO help?

If you are planning on buying your home from a friend, family member, or another already known party, then save thousands of dollars by skipping a real estate agent and hiring GLO, a law firm with extensive experience in helping buyers purchase their new homes. GLO can help prepare and review any proposed offers, and get you connected with the right title companies.

Even if you decide you want to pay for the assistance of a real estate agent, GLO can still help ensure this process goes as smoothly as possible for you. GLO can help you review the sale and purchase offer, draft a favorable contract with any necessary addendums to accommodate special circumstances or demands, and most of all, help you in the negotiation and closing of the transactions.

Please fill out an Intake Form to inquire about working with GLO.

GLO has prepared this blog to provide general information on legal issues that may be of interest. This blog does not provide legal advice for any specific situation and this does not create an attorney-client relationship between any reader and GLO or its attorneys. GLO engages clients through a specific fee agreement. GLO does not guarantee any results.