If you are a landlord running a rental business in Colorado, you should do everything you can to stay aware of property management laws in your state. Various laws can have implications for the way you run your business and learning about Colorado landlord tenant laws is a great step towards making business decisions that are both effective and compliant.
Let’s take a look at some of the most important aspects of state and federal property management laws that you should be aware of in Colorado.
Tenant Screening
During the tenant screening process, it is very important that you are aware of laws against housing discrimination. Colorado follows the protections of 1968’s federal Fair Housing Act, which bans any form of housing discrimination by landlords or real estate agents based on race, color, religion, gender, national origin, familial status, and disability.
The Colorado fair housing act upholds all of these protections and also prohibits discrimination based on sexual orientation, gender identity, gender expression, marital status, veteran or military status, and ancestry.
State law does not forbid Colorado landlords to run criminal background checks on applicants and consider their findings in the decision-making process. However, you should generally follow the advice of the US Department of Housing and Urban Development (HUD) and avoid denying applicants solely because they have a criminal record. It is much more effective to look at each applicant individually, determining on a case-by-case basis whether they either pose a threat to safety or potentially cannot follow the terms of a lease agreement.
Rent and Fees
In Colorado, rent control is banned, and there can be no legal limit placed on how much landlords can charge their tenants for rent. If you wish to raise your tenant’s rent, however, you must give your tenants at least 60 days’ notice.
However, there is an enforced ceiling when it comes to charges late fees for missing rent payments. Colorado state law dictates that the maximum amount that a landlord can charge for late fees is the greater value between $50 or 5% of the total rent price. Considering that the median rent price is $2,250, a charge of 5% ($112.50) is very likely to be the greater of the two options.
Before you can charge your tenants any late fees, however, you must give your tenants at least a seven-day grace period. For at least a week after the rent collection date has passed, you are required to accept late rent payments from your tenants without any form of penalty. After this seven-day period, you can start charging late fees.
Evictions
Let’s say that you have a tenant who persistently fails to pay their rent. You have given them a seven-day grace period and are now charging late fees, but they are still not paying. This can have serious effects on your business, and it is grounds to file for eviction.
According to Colorado laws on eviction, you must issue a rent demand notice before you can file the eviction lawsuit with the court. This notice should give the tenant at least ten days to pay what they owe. If the tenant satisfies their debt during this period, you cannot file for eviction.
It is important to make note of the difference between the grace period and the ten-day period required by the rent demand notice. The ten-day period can only begin after the grace period has ended; the two must not overlap with each other. At minimum, a tenant should have at least seventeen days after the rent collection date has passed to submit their rent payment, assuming you issue a rent demand notice as soon as the grace period has ended.
Conclusion
Hopefully this article has given you insight into how to make informed rental decisions that comply with the law in Colorado. Being aware of regulations in your industry is an important step in running a business that is successful and sustainable. Although staying on top of this information can be hard work, its potential to keep you out of legal trouble makes it necessary and valuable.