The Centennial State's passage of a bill that sets prohibitions on non-title recorded agreements for personal services is adding momentum to a movement against these property sale restrictions.
These contracts involve agreements in which the owner of a property receives a small fee in exchange for giving an entity an exclusive right to sell in the future and sometimes have shown up in buyers'
"NTRAPs are a predatory practice, and the Colorado legislature has put an end to these schemes that impact homeowners' ability to
In a typical NTRAP a company may offer homeowners a quick payment of $300 to $5,000 in exchange for an exclusive listing right that can last around 40 years, according to the Colorado Association of Realtors. Those homeowners may be unaware of the contingency involved.
"The contract is binding across generations, not just the current homeowner," the state trade group noted, also adding homeowners have faced threats of foreclosure and litigation in conjunction with NTRAPs, which are also known as broker engagement contracts.
The Colorado Senate voted 32-0 for the measure, according to the Realtors association. The Colorado Assembly voted 59-5 in favor of it.
Specifically prohibited in the bill, which had bipartisan support, are covenants "running with the land or to be binding on future owners."
The bill also bans "assignment of the right to provide service without notice and agreement of the owners," and purported ownership interests in the property associated with broker engagement contracts, calling them "void and unenforceable."
