Material Damage



​As of April 14, 2016, the regulation change regarding material damage disclosures is in effect. Colorado has always required dealers and wholesalers to disclose material damage. This regulation now better defines Material Particulars and also those items it is not necessary to disclose. Disclosure must be given, in writing prior to the signing of the Contract, and the disclosure form is deemed to be part of the Contract. The Regulation is included below. CIADA has a Vehicle Disclosure Damage form - Contact them for more information!


Regulation 12-6-118(3)(I)

A. Definition for Purposes of this Regulation

  1. "Contract" means any written agreement, such as a purchase agreement, buyer order, or invoice, between a Dealer and a Buyer for the sale of a motor vehicle, excluding the Retail Installment Sales Contract (RISC).
  2. "Dealer" means a motor vehicle dealer, used motor vehicle dealer, wholesaler, wholesale motor vehicle auction dealer, motor vehicle auctioneer, or a representative of the dealership.
  3. "Seller" means Dealer.
  4. "Buyer" means a retail consumer or a Dealer.
  5. "Material Particulars" means those details concerning a vehicle for sale that are essential or necessary for a reasonable prospective Buyer to know prior to making the decision to buy or not to buy a vehicle.

B. Disclosure Process

Prior to the signing of the Contract, the Seller shall produce a written document disclosing all known Material Particulars. Both the Seller and Buyer must sign the document. The document is deemed to be part of the Contract. A signed copy of the Contract and the disclosure document shall be provided to the Buyer at the time of sale. The Seller shall retain a copy of the contract and the disclosure document.


C. "As Is" Statement

A statement by the Seller to the Buyer that a vehicle is sold "as-is" does not relieve the Seller of the disclosure obligations otherwise required by state or federal law. An "as-is" statement solely disclaims implied warranties under provisions of the "Colorado Uniform Commercial Code," Title 4, C.R.S.


D. Non-Exclusive List of "Material Particulars"


Material Particulars include but are not limited to any of the following:

  1. The motor vehicle is a "Salvage vehicle" as that term is defined in the Colorado "Certificate of Title Act," Part 1, Article 6, Title 42, C.R.S.
  2. The motor vehicle has sustained damage, whether repaired or not repaired, of the following types:
  • Frame or unibody damage of any grade or type; or
  • Flood, fire or hail damage; or
  • Accident or collision damage.

3. The motor vehicle has been modified in a way that impacts warranty coverage.

4. The motor vehicle had been declared a "total loss" by an insurance company.

5. The motor vehicle had been stolen.

6. The motor vehicle had been used as a police vehicle, vehicle for hire, rental vehicle, or a loaner or courtesy vehicle, if such use is clearly ascertainable from a title brand, from information obtained from a prior owner, from a Vehicle Identification Number (VIN), from a State-issued Identification Number, or from any other source.

7. The motor vehicle had been put to use or had been altered in such a way that a reasonable person would consider unusual or extraordinary, such as use as a racing vehicle.


E. Matters Generally Not Considered "Material Particulars"


This list is not intended to be all-inclusive. Material Particulars do not generally include the items on the following list:

  1. Normal wear and tear.
  2. Completed or prior mechanical repair.
  3. General maintenance.
  4. Repair or replacement of tires, wheels, glass, handlebars, moldings, radios, in-dash audio equipment, or the like, provided that the repair or replacement was completed in a manner reasonably comparable to manufacturer's specifications and provided that any repaired or replaced item is functioning at the time of sale in the manner that a reasonable person would expect.
  5. Touch-up paint for minor scratches, dents, or dings.
  6. Completed recall repair, provided the repair was done by a dealer authorized by the manufacturer to perform such repairs.

We recommend that you have trade customers complete a Trade Affidavit, disclosing material particulars to the dealership. Ensure this information is then relayed to the Buyer. For recall information, check www.safercar.gov and provide printouts of relevant information to the Buyer.


If you are selling and buying through wholesale auctions - a Memo of Understanding for Wholesale Auction Disclosure, has been distributed to all Colorado Licensed Wholesale Motor Vehicle Auction Dealers. They shall be in compliance with Paragraph "B" as stated above by:

  1. Making all required known disclosure announcements at the auction block prior to running the vehicle
  2. Having all required known disclosure announcements printed on the vehicle sales invoice
  3. Having buyer of vehicle acknowledge required disclosure announcements by signing invoice at time of auction
  4. Auction retaining copy of signed disclosure by buyer.