Are HOAs required to disclose ongoing litigation with current owners during closing?

Thank you for reaching out. To answer your question: HOAs in Colorado are not expressly required by statute to disclose ongoing litigation during a home sale. Sellers may have a duty to disclose, but only if they are aware of it and it is a material adverse fact.

C.R.S. 38-35.7-102 states that sellers in a common interest community must provide buyers with key HOA documents upon request. These documents, such as financial and governing records, may include information about pending or ongoing litigation, especially if it affects the HOA’s operations or budget. Sellers can provide these documents themselves or authorize the HOA to release them on their behalf. 

Additionally, C.R.S. 38-33.3-317 requires HOAs to maintain detailed records, including construction defect claims and settlement information, and to make these records available to unit owners. While this statute does not mandate disclosure during closing, it ensures that owners can access litigation-related details upon request.

Finally, C.R.S. 38-33.3-303.5 may require sellers to disclose known issues—such as active litigation—that could lead to increased assessments or financial obligations for the buyer.

If you have any questions, our team of knowledgeable real estate attorneys is available to review your documents.