What is a conditional sale deadline in Colorado?

A conditional sale deadline in Colorado refers to the date by which a buyer must secure financing when purchasing a home or other property under a conditional sales contract. This type of contract allows the buyer to take possession of the property before securing financing. The conditional sale deadline gives the buyer a set period of time to obtain a loan commitment and close on the purchase.

What is a conditional sales contract?

A conditional sales contract, also known as an agreement for deed or contract for deed, is a type of real estate purchase agreement where the buyer takes possession of the property before obtaining financing or paying the full purchase price.

With a conditional sales contract:

  • The buyer makes a down payment to the seller, usually ranging from 10% to 30% of the purchase price.
  • The buyer takes possession of the property immediately but does not receive the deed until the remaining balance is paid off.
  • The buyer makes installment payments over time until the balance is paid in full.
  • The seller retains legal title or ownership until all payments are made.

Conditional sales contracts are popular with buyers who cannot qualify for traditional financing. It allows them to purchase and move into a home while taking time to improve their financial standing and secure a mortgage.

Why do conditional sales contracts have deadlines?

Conditional sales contracts contain deadlines to protect both the buyer and seller. These deadlines motivate the buyer to obtain financing within a reasonable timeframe. Without a deadline, the buyer could take possession without ever securing a loan and fully paying the seller. Specific reasons conditional sales contracts have deadlines include:

  • Buyer financing contingency – The deadline creates a financing contingency allowing the buyer a set time to apply for and secure a mortgage.
  • Seller protection – The deadline ensures the seller will receive the remaining balance within a predictable timeframe or regain possession.
  • Transfer of title – The deadline marks the date by which the buyer must pay off the contract and receive the property deed.
  • Limit of occupancy – The buyer can only occupy the home until the deadline if they fail to obtain approval for financing.

In summary, the deadline motivates the buyer to arrange financing while providing the seller with a date by which they’ll either be paid in full or regain their property.

What happens if a buyer misses the conditional sale deadline?

There can be serious consequences if a conditional sale deadline passes and the buyer has not secured financing and paid the remaining balance. Each contract is unique, but possible outcomes of missing a conditional sale deadline include:

  • The contract terminates and the property goes back to the seller.
  • All payments made are forfeited to the seller.
  • The buyer must immediately vacate the property.
  • The seller keeps the down payment as liquidated damages.
  • The seller can file an eviction lawsuit to remove the buyer.
  • The buyer may be liable for rent for the occupancy period.
  • The buyer loses any leverage to renegotiate the purchase terms.

As such, buyers should be sure they can follow the contract terms and secure financing well before the conditional sale deadline. Missing the deadline usually means losing any claim to the property and the money already paid.

How long are conditional sale deadlines in Colorado?

Colorado law does not specify an exact timeframe for conditional sale deadlines. The deadline period is negotiable between the buyer and seller when drawing up the contract terms. However, typical conditional sale deadlines fall into these ranges:

  • 30-90 days – Common deadlines for securing financing approval.
  • 6-12 months – Deadlines for paying the full balance.
  • Up to 5 years – Longer term contracts with balance paid over years.

Shorter 30-90 day financing approval deadlines allow the buyer to obtain a loan commitment letter. Longer 6-12 month deadlines give the buyer time to pay the entire remaining purchase price. Multi-year deadlines are less common but give the buyer several years to pay down the balance through installment payments.

Can you extend a conditional sale deadline?

It may be possible to extend a conditional sale deadline if certain conditions are met:

  • The buyer requests the extension well before the original deadline.
  • The buyer can demonstrate they have made good faith efforts to secure financing.
  • The seller agrees to the extension and amends the contract.
  • Any extension fees or other consideration specified in the contract are paid.
  • The extension provides a clear new deadline rather than an open-ended extension.


Deadline Type Typical Duration
Financing Approval 30-90 days
Full Balance Payment 6-12 months
Long-term Contracts Up to 5 years

The buyer should review the original contract terms carefully, as some conditional sale agreements do not allow for extensions. Extensions also require mutual consent – the seller is not obligated to grant an extension. The buyer will need to demonstrate reasonable efforts to secure financing and offer incentives that benefit the seller, such as a fee payment or higher interest rate on the remaining balance.

What happens after a conditional sale deadline closes?

Meeting the conditional sale contract deadline has significant legal implications:

  • The deed transfers to the buyer – Title and ownership shift from seller to buyer.
  • The mortgage lender records a lien – The lender records a lien against the property backing the new mortgage loan.
  • The contract terms are satisfied – Both parties meet their contractual obligations.
  • The buyer now owns the property – The buyer obtains equitable title and can sell or transfer ownership.
  • The seller receives payment – The seller is paid in full, either from financing or the buyer directly.

Once the deadline passes and terms are fulfilled, the conditional sale converts to an outright purchase transaction. The buyer takes full ownership and responsibility for the property. If the contract terms were not met, the property reverts to the seller unencumbered by claims from the buyer.

Can a conditional sales deadline be removed from a contract?

It is generally not advisable or feasible to remove or eliminate a conditional sale deadline from a contract. These deadlines are included to protect the interests of both seller and buyer. However, in rare cases a deadline could potentially be removed through:

  • Mutual agreement – Both parties consent and sign an amendment removing the deadline.
  • Court order – A judge orders the deadline removed because it is unlawful or unenforceable.
  • New contract – The parties void the existing contract and create a new one without a deadline.

These situations are uncommon. More often, the parties negotiate deadline extensions or modifications if needed. Completely removing the deadline compromises the contractual rights of the seller. A buyer seeking removal typically must offer some other form of compensation that provides similar protection to the seller.

What happens if a conditional sale contract has no deadline?

Conditional sales contracts without specified deadlines are generally ill-advised because they fail to adequately protect the interests of both parties. Possible issues when no deadline is in place include:

  • The buyer has no motivation to obtain financing.
  • The seller has no recourse if payments stop.
  • It becomes an open-ended rental agreement.
  • The title remains in limbo making it hard to sell.
  • The buyer can occupy the property indefinitely.
  • Neither party can fully enforce their rights.

To avoid these problems, conditional sale contracts should always outline a clear financing and full payment deadline. Removing or failing to include deadlines should generally be avoided.

How are conditional sale deadlines enforced in Colorado?

Colorado law provides remedies for sellers to enforce conditional sale deadlines if a buyer breaches the contract terms. These may include:

  • Eviction – Filing an eviction lawsuit to remove the buyer from the property.
  • Judicial foreclosure – Suing in court to force a property sale to collect unpaid balances.
  • Forfeiture – Keeping all payments made if the buyer defaults.
  • Specific performance – Suing to force the buyer to complete the purchase.
  • Declaratory action – Obtaining a court order declaring the seller’s rights.

Colorado law allows sellers to file court actions against non-paying buyers after 30 days of default. Sellers can pursue financial judgments against buyers as well. Buyers also risk civil and tax liabilities if they fail to comply with contract deadlines and terms.

What defenses does a buyer have for missing a deadline?

A buyer generally cannot defend against enforcement actions if they miss unconditional deadlines in the contract terms. However, possible buyer defenses related to conditional sale deadlines can include:

  • The deadline is unreasonable or unrealistic.
  • The seller hindered the buyer from obtaining financing.
  • The seller made misrepresentations about the property condition or value.
  • The seller did not properly convey title to the property.
  • The seller violated landlord/tenant laws during occupancy.
  • There are issues with the physical condition or title of the property.

While these defenses are situation-specific, they demonstrate conditional sale terms cannot be exploitative or unlawful. Buyers can raise counterclaims against the seller as well during enforcement actions.

Can a conditional sale contract be voided or cancelled?

There are certain circumstances where a conditional sale contract could potentially be voided or cancelled:

  • The seller commits fraud or fails to disclose material defects.
  • The property title contains undisclosed encumbrances.
  • The property is damaged or destroyed before closing.
  • The seller is unable to deliver marketable title.
  • The seller files bankruptcy during the contract term.
  • The parties mutually agree to void the contract.
  • A court finds the contract terms unenforceable.

However, a conditional sales contract cannot normally be voided simply because a buyer changes their mind or fails to secure financing on time. There must be evidence of breach by the seller or an inability to complete the transaction due to circumstances outside the buyer’s control.


Conditional sale deadlines in Colorado provide important protections for buyers and sellers engaging in alternative financing arrangements. By setting expected timeframes to obtain financing and complete payments, the deadlines motivate buyers while giving sellers recourse if the contract terms are not fulfilled. Parties should carefully negotiate deadline periods during the contract formation process to ensure they allow adequate time while avoiding open-ended agreements. Buyers in particular should be confident they can comply with established deadlines or seek extensions well in advance of expiration dates.