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This guide provides essential information for dealers looking to offer car consignment services in Colorado. Understanding these requirements helps ensure compliance with state regulations.
Car consignment in Colorado is legal, but dealers must follow Colorado licensing, title/ownership documentation rules, and retail-sale disclosure requirements. These Colorado car consignment rules, dealer requirements, and best practices (updated for 2026) cover dealer licensing, written agreements, title handling, seller funding timing, insurance, lien payoff, fee disclosure, and cancellation terms.
Only properly licensed motor vehicle dealers may legally offer vehicle consignment services and sell consigned vehicles to the public in Colorado.
Colorado dealer licensing and regulation is administered by the Colorado Department of Revenue — Auto Industry Division (AID) and the Colorado Motor Vehicle Dealer Board.
Source: Colorado DOR – Auto Industry Division (Dealer Licensing)
Source: Colorado Motor Vehicle Dealer Board overview
Colorado does not publish a single required “state consignment agreement” form for dealers, so the dealer should use a written consignment agreement as the primary compliance tool.
The agreement should include:
Seller name, address, phone, email, and vehicle details (VIN, mileage, title status)
Dealer responsibilities (marketing, storage, showings, test drives, payoff coordination if applicable)
Commission/fee structure and any seller-authorized charges (reconditioning, repairs, detail, storage, marketing)
Seller funding timeline (when/how seller receives net proceeds after sale)
Title handling plan (who holds title, what documents are collected at intake, lien/payoff process)
Insurance responsibilities while on consignment (dealer policy + seller policy expectations)
Cancellation / retrieval terms and any authorized fees
Best Practice: Seller receives a signed copy; dealer retains the original in the deal jacket.
Sample Car Consignment Agreement (Template)
Colorado is very documentation-driven for dealer inventory. Dealers should treat title/ownership paperwork as non-negotiable at intake.
Colorado dealer rules require dealers/wholesalers to maintain proof of ownership documentation for vehicles in their possession.
Colorado dealer title rules are addressed in 1 CCR 204-10 (Dealer Title / Proof of Ownership requirements).
Colorado law requires dealers to deliver or facilitate delivery of the certificate of title within 30 days after the sale.
Colorado regulations explicitly recognize vehicles “owned by or consigned to the dealer” for demo-plate usage, and identify acceptable proof as MCO, title, or a consignment agreement properly assigned in the dealer’s licensed name.
Best Practice:
Obtain and securely store the seller’s title (or other acceptable ownership document), plus lien/payoff documents if a loan exists.
Ensure odometer disclosure requirements are satisfied for the retail sale transaction (federal + state requirements apply at sale).
Colorado law sets a 30-day title delivery requirement after sale (dealer must deliver or facilitate delivery of the title).
Colorado does not publish a universal “consignment payout deadline” the way some states do; therefore seller payment timing should be defined in the consignment agreement.
Best Practices:
State the payment trigger clearly (example: “after dealer receives cleared funds from buyer/buyer’s lender”).
State the timeline clearly (example: “within X business days after trigger”).
Define allowed deductions (commission/fees, authorized recon, lien payoff, etc.).
Include an unwind process if the retail deal is rescinded (return of vehicle / return of funds rules).
Dealers should confirm their garage liability policy covers vehicles on the lot including vehicles held under consignment arrangements (non-owned inventory exposure varies by insurer).
The agreement should address test drive liability and physical damage responsibilities.
Best Practice:
Require sellers to maintain comprehensive coverage during consignment (and verify with proof of insurance).
Have the seller initial the insurance section of the agreement.
Colorado has a prescribed disclosure form used as part of retail vehicle sales contracts:
Colorado’s DR 2434 (“Disclosures Required as Part of a Motor Vehicle/Powersports Vehicle Sale”) is required as part of motor vehicle sales transactions and is treated as part of the purchase contract.
Best Practice: Ensure your retail sale paperwork process is consistent and complete for consigned vehicles, including all required disclosures and itemizations.
Vehicles with open loans can be consigned, but lien payoff must be handled so title can transfer without delay.
Best Practice at intake:
Lender contact information
Current payoff statement with loan or account number
Written authorization for the dealer to coordinate payoff and title release
Identify negative equity early (payoff higher than expected net sale proceeds) and collect the shortfall so the lien can be satisfied at sale.
All commissions and fees should be clearly disclosed in writing in the consignment agreement (and reflected consistently in the retail sale paperwork where applicable).
Disclose: commission, recon authorizations, storage/marketing fees, doc/admin fees (if any), payoff handling costs (if any).
Best Practice: Include a simple “Seller Net Sheet” section showing sale price minus commission/fees minus authorized deductions = estimated seller net proceeds.
Cancellation terms should be spelled out in the consignment agreement, including notice requirements, vehicle retrieval timing, and any authorized costs due upon termination (storage/recon/marketing if applicable).
Include a process for handling deposits/holds and rescinded retail deals (unwind rules).
Can a private seller consign without going through a dealer in Colorado?
No. Consignment sales to the public should be handled through licensed Colorado dealers regulated by the Auto Industry Division and Dealer Board.
How fast must title be delivered after a retail sale in Colorado?
Colorado requires a dealer to deliver or facilitate delivery of the certificate of title within 30 days after the sale.
Can a car with a loan still be consigned?
Yes, as long as lien payoff is handled so the lien can be satisfied and title released. If payoff exceeds expected net proceeds, the seller must cover the shortfall so the lien can be fully satisfied.
Want more general answers about selling or consigning a car?
Visit Retail My Ride’s full FAQ center
Last reviewed: January 2026
Once you understand the consignment requirements in Colorado, the next step is putting them into practice. Retail My Ride connects licensed dealers with motivated consign-ready sellers, helping you stay compliant while growing your inventory.
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This page is provided by Retail My Ride for general informational purposes only. It is not legal advice. Car consignment laws and dealer requirements may change at any time. Always confirm the latest rules with your state DMV, licensing authority, or qualified legal counsel before making decisions.
This information is provided for general reference only. Laws and regulations change frequently. Always consult with legal counsel and verify current requirements with your state's DMV or regulatory authority before offering consignment services.
Learn more through our Articles, Common Questions, Testimonials, About Us, and Which Vehicles Are Best Suited for Consignment.
