Why Colorado Landlords Shouldn’t Use Zillow To Create Lease Agreements

Managing rental property in Colorado is expensive, so it's easy to see the appeal of automated tools like Zillow promising an instant lease in a few clicks. But convenience should not come at the cost of enforceability. Your lease agreement is the single most critical document protecting your property. When a tenant stops paying rent or refuses to leave, discovering that your DIY online template has invalid terms is a worst-case scenario.

Unless a platform is actively updated by licensed Colorado attorneys, you aren't getting legal protection—you're just paying for an official-looking PDF. Here are three common legal pitfalls I see lurking in DIY lease templates.

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So, how do I know so much about the free online-generated contracts? Well, they cross my desk all the time. Landlords come to me for help as they’re gearing up to go to court, and I want to share with you what I consistently find wrong in these fast and free lease agreements:

Landlords usually want to recover monetary damages when they evict a bad tenant – either to compensate for unpaid rent or cover the cost of property repairs. They also want to recover the costs of hiring an attorney to assist in seeking damages. So I’m specifically looking for a fee-shifting provision in the lease agreement.

Typically, a party to litigation pays his/her own attorney’s fees.  Now, this is the default, but a clause leaves room for fee-shifting in specific circumstances. Each state has its own set of rules to clarify what counts as a specific circumstance. Here’s how Colorado’s has been summarized:

“In the absence of an express statute, court rule, or private contract to the contrary, attorney fees generally are not recoverable by the prevailing party in a contract or tort action.” Allstate Ins. Co. v. Huizar, 52 P.3d 816, 818

In 2021, an amendment to Colorado landlord-tenant law made it illegal to include fee-shifting provisions that could benefit only one party in a property dispute. But in 2023, lawmakers expanded on this amendment, adding that fee-shifting provisions can be included if the court has seen and approved the specific language beforehand. C.R.S. 38-12-801

The online-generated lease agreements I’m seeing consistently leave out the option to include a fee-shifting provision entirely. Other templates will include one-sided fee-shifting provisions that are completely unenforceable if you actually have to use them in court.

When you have no way of knowing if a company offering one of these tools has updated its template to reflect current law, you risk being stuck with the entire bill, even if you win in court.

When there isn’t a fee-shifting provision in the lease, the damages you might win in court could end up going toward paying your attorney’s fees. A proper fee-shifting provision can help you recover the costs of litigation when you held up your end of the contract, but the other party refused.

No landlord drafts a lease agreement hoping it will someday become a talking point in court. But things happen. And when they do, you will want an enforceable lease that protects your interests.

You would be surprised by how many of these online-generated leases are full of provisions that sound great, but aren’t enforceable and, therefore, are legally invalid.

In fact, it’s likely that you’re being prompted to include mistakes by Zillow’s or any other company’s online lease generator. A lease generator is simply a digital questionnaire that asks a series of questions about your tenant, property, terms, and rights. It goes something like this:

• Who are the tenants?

• What type of property is it?

• What day of the month is the rent due?

But then, the simplified questions get more complicated, especially if you’re someone new to this business:

• Do any easements, covenants, conditions, or restrictions apply to the property?

• Will there be any prorated rent when the tenant moves in?

• Do any homeowners association rules apply to the property?

Sometimes these platforms anticipate user confusion by offering a link to a footnote that might clarify general aspects of the law. Some sites provide a chat box where you can ask a question that a bot will try to answer.

This is where my clients are likely to start guessing, and that’s a problem. Most of the time, my clients add information they think is correct, or sounds correct. And that’s the big problem with DIY-style online lease agreements. Unless you know exactly what you’re doing, you risk being hit with statutory penalties. I see this a lot with late rent payment provisions.

In Colorado, landlords can’t charge tenants a late fee unless the rent hasn’t been paid in at least seven days. If you try to charge your tenant a late fee any sooner, you violate C.R.S. 38-12-105. You could end up paying a penalty between $150 and $1,000.

There’s also a limit to how much landlords can charge tenants for late rent: $50 at most or 5% of the amount of past-due rent.

Where Zillow’s Lease Builder Fails on Colorado Rent Provisions

Zillow’s online lease builder may recommend more “common” grace periods, but ultimately lets the landlord enter whatever number they want. You can see how an erroneous entry can open you up to legal consequences. C.R.S. 38-12-905

Another common issue I see among the leases created online is dated provisions. We wrote about Colorado House Bill 23-1095 when it took effect. One of the rules in this law makes it illegal for landlords to ask tenants for additional rent. So you can’t call something like utilities “rent.” Yet, I still see provisions on leases from Zillow and other companies seeking additional rent.

I’ve also come across leases that provide for landlords to receive a predetermined amount of money if a tenant violates the terms of the contract. While this may sound great, it isn’t enforceable under HB 23-1095.

Landlords also cannot ask for nonrefundable security deposits for pets. HB 23-1068, which took effect on January 1, 2024, makes it illegal. But yet — it still shows up in online-created leases.

Zillow is a household name. Its business model aims to be a one-stop shop for all things real estate. Its lease-building tool is designed to be simple and easy to use. But the law isn’t designed to be simple, and relying on a tool that oversimplifies it won’t protect your interests.

When you purchase a Robinson & Henry lease agreement package for a flat fee, you get a lease agreement that:

• is fully compliant with Colorado law

• adaptable to meet your needs

• includes all of the different disclosures and addenda you’ll need (lead paint, marijuana, etc.)

• has a provision specific to HOAs, usually not included in a free, online lease template

Download a Colorado-Compliant Lease Today.

R&H lease packages are built specifically for Colorado landlords. You get the immediacy of an online lease without the worry of hidden compliance traps and unenforceable clauses.

If you're concerned that your current lease agreement is jeopardizing your rental income, give us a call. Our landlord-tenant attorneys can review your lease and make recommended changes if necessary. Call 303-688-0944 to schedule a lease review or book a consultation online.