By Prerna Kapoor, CLHMS | REAL Brokerage | March 22, 2026
You found the home. You made an offer. The seller accepted. You’re on top of the world.
And then someone hands you a 14-page form called the Seller’s Property Disclosure.
Most buyers skim through it. Some don’t read it at all. That’s a mistake. This document is one of the most important things you’ll review during your entire transaction, and knowing how to read it can save you from a very expensive surprise down the road.
Here’s what you need to know about Colorado’s SPD form, what the red flags look like, and how to use this document to protect yourself.
What Is the Seller’s Property Disclosure in Colorado?
In Colorado, sellers are required to fill out a standardized form called the Seller’s Property Disclosure (SPD). The Colorado Division of Real Estate updates this form periodically. The most recent version, updated for use on or after January 1, 2026, runs 14 pages and covers everything from the roof to the sewer line.
The form asks the seller to disclose what they actually know about the property’s condition. That phrase matters: “current actual knowledge” means the seller only has to share what they personally know to be true. They don’t have to investigate or guess. But they can’t hide something they’re aware of, either.
Think of it this way. If the basement flooded twice last spring and the seller knows about it, they have to tell you. If there’s a slow foundation crack they’ve never noticed, they technically don’t have to disclose it. That’s why a home inspection is still essential, even when the disclosure looks clean.
The Sections That Matter Most
The SPD covers a lot of ground. But some sections deserve more attention than others. Here’s where to focus your energy:
Structural and Foundation Issues
This is the big one. Colorado’s expansive clay soils (especially along the Front Range) cause more foundation problems than most states. Look for any mention of cracks, settling, movement, or repairs. If the seller discloses foundation work was done, ask for documentation. You want to know who did it, when, and whether it came with a transferable warranty.
Water and Drainage
Colorado buyers sometimes assume dry climate means dry basements. That’s not always true. Heavy spring runoff, poor grading, and aging drainage systems cause water intrusion more often than you’d think. Watch for disclosures about sump pumps, water in the crawlspace, or any mention of flooding, even if the seller describes it as “minor.”
Roof Condition and Hail Damage
Colorado gets some of the worst hailstorms in the country. If the seller has filed an insurance claim for hail damage, it should show up on the disclosure. Pay attention to the age of the roof and whether it’s been replaced or repaired. A roof that’s 18 years old in Parker has had a very different life than an 18-year-old roof in a milder climate.
Plumbing and Sewer
Older homes in the Denver metro area sometimes still have clay sewer lines. These can crack, collapse, or get invaded by tree roots. If the seller mentions any sewer line issues or repairs, ask follow-up questions. A sewer scope inspection (usually $200 to $350) is one of the smartest investments a buyer can make in Colorado.
Heating and Cooling Systems
Colorado’s winters put serious demand on your furnace. The SPD asks about the age and condition of the HVAC system. With Colorado’s new furnace law (HB23-1161) requiring certain efficiency standards on replacement units, knowing the age and type of your furnace matters more than ever. If the system is 15 or more years old, factor replacement costs into your budget.
Red Flags to Watch For
Not every issue on a disclosure is a dealbreaker. But certain patterns should make you pause and dig deeper.
Blank or skipped answers. If a seller leaves a question blank, it doesn’t mean everything is fine. It might mean they’re avoiding the question. Colorado’s form requires an answer for each item. Blanks are a signal to ask your agent for follow-up.
“Unknown” on everything. Some sellers write “unknown” on nearly every line. While it’s legally allowed, it’s unusual for someone who’s lived in a home for years to not know the age of the water heater or whether the basement has ever had moisture. Excessive use of “unknown” is worth questioning.
Vague descriptions of past repairs. “Some work was done on the foundation” is not helpful. You want specifics: what was the problem, who did the repair, when was it completed, and is there a warranty? If the seller can’t or won’t provide details, your inspector should look extra carefully in that area.
Insurance claims without explanation. If the seller discloses insurance claims but provides minimal detail, follow up. Hail claims are common and usually not a concern if repairs were completed. But claims for water damage, fire, or structural issues deserve a closer look.
Recent repairs to the same system. If the disclosure shows the furnace was replaced two years ago and the water heater was replaced last year, that might just be a homeowner being proactive. Or it could mean there was a bigger issue (like a flood or gas leak) that triggered multiple replacements. Context matters.
What the Disclosure Doesn’t Tell You
Here’s something most buyers don’t realize: the SPD only covers what the seller knows. It doesn’t tell you about problems they never discovered. That’s why the disclosure and the inspection work together. They’re two different tools that serve two different purposes.
The disclosure tells you what the seller is aware of. The inspection tells you what’s actually happening with the home right now. You need both.
Also, the SPD doesn’t cover things like neighborhood noise, HOA disputes, or whether the neighbors park on the lawn. Those are things you’ll want to research on your own by visiting the property at different times of day and checking the HOA documents if applicable.
How to Use the Disclosure During Negotiations
A lot of buyers treat the disclosure as a “check the box” step. But it’s actually a negotiation tool.
If the seller discloses a known issue, say an aging sewer line or a roof nearing end of life, you can use that information during the inspection objection period. You might negotiate a price reduction, ask the seller to complete repairs before closing, or request a credit at closing to handle it yourself.
The key is being strategic. Not every disclosure item is worth negotiating over. Focus on the big-ticket items: foundation, roof, plumbing, HVAC, and anything that affects the home’s safety or structural integrity.
Colorado-Specific Things Buyers Forget
A few things that come up regularly in Colorado transactions:
Radon. Colorado has some of the highest radon levels in the country. The SPD asks about radon testing results. If the seller has tested and found elevated levels, ask whether a mitigation system was installed. If they’ve never tested, plan to include radon testing in your inspection. Mitigation typically costs $800 to $1,500.
Well and septic. If you’re buying in areas like Elizabeth, Franktown, or parts of Castle Rock, the home may be on well water and septic. The SPD has specific questions about these systems. Well flow rate, water quality testing, and septic inspection dates are all things you’ll want to verify independently.
Wildfire risk. For homes in areas near open space or foothills, check whether the seller has disclosed any wildfire mitigation work. Colorado’s growing wildfire risk is something lenders and insurers are paying more attention to, and it can affect your insurance costs significantly.
Mineral rights. In Colorado, surface rights and mineral rights can be separate. The SPD asks about this. If mineral rights have been severed from the property, it means someone else could potentially drill or mine on or near your land. This is more common than people expect, especially in Douglas and Weld counties.
Your Next Steps
When you receive the Seller’s Property Disclosure, read it carefully. Don’t skim. Take notes. Circle anything that raises a question. Then talk to your agent about what you’ve found.
A good agent won’t just hand you the disclosure and move on. They’ll walk you through it, flag anything that looks unusual, and help you decide which items to address during the inspection period.
If you’re starting your home search or you’re already under contract and want a second opinion on a disclosure, I’m happy to help. This is one of those areas where having someone experienced in Colorado real estate makes a real difference.
Thinking about buying or selling a home in Colorado?
Your home journey should feel exciting, not overwhelming. As your trusted advisor, I am here to make sure it does.
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Prerna Kapoor is a REALTOR® and Certified Luxury Home Marketing Specialist (CLHMS) with REAL Brokerage, specializing in residential real estate across Parker, Aurora, Lone Tree, Castle Pines, Highlands Ranch, Cherry Creek, Greenwood Village, and Centennial. She is fluent in English, Hindi, and Japanese (native) and is recognized as an International Sterling Society Award winner (2023, 2024, 2025). Prerna holds the RENE (Real Estate Negotiation Expert), PSA (Pricing Strategy Advisor), and ABR (Accredited Buyer’s Representative) designations.
