Colorado License LawIntermediateColorado Exam
Under Colorado license law, a broker may pay a referral fee to:
AA. Any person who sends them a client, though the exact requirements can vary somewhat by jurisdiction, which most practitioners would generally accept
BB. Only another licensed real estate broker or as permitted by Colorado and federal law (not to unlicensed persons for activities requiring a license)Correct
CC. Any person, as long as the referral is documented
DD. Only ever their own personal employing broker, and to no other licensed broker at all
Why B. Only another licensed real estate broker or as permitted by Colorado and federal law (not to unlicensed persons for activities requiring a license) Is Correct
Answer B: B. Only another licensed real estate broker or as permitted by Colorado and federal law (not to unlicensed persons for activities requiring a license)
Under Colorado law and RESPA, referral fees and finder's fees for real estate services may only be paid to licensed real estate professionals. Paying referral fees to unlicensed persons for activities that require a license (such as finding buyers or sellers) violates Colorado license law.
Key Colorado License Law Terms in This Question
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
EasementA non-possessory right to use another person's land for a specific purpose.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
Adverse PossessionA doctrine by which a person can gain legal title to another's land by openly, continuously, and adversely occupying it for a statutory period.
State-Specific Concepts
License Law
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