How to Protect Yourself From AI in a Colorado Real Estate Transaction

Artificial intelligence is rapidly changing real estate. Buyers and sellers can now use AI to search for properties, estimate values, analyze neighborhoods, review documents, compare homes, generate marketing materials and even help understand contracts.

I believe that can be a very good thing.

AI has the potential to give consumers access to information and tools that were once available primarily through real estate professionals. But there is an important difference between using AI as a tool and allowing AI to quietly make—or materially influence—important decisions about you.

That distinction is particularly important in real estate and we here at Colorado Realty 4 Less want to make sure you are protected.

AI May Already Be Part of Your Transaction

You may encounter automated technology without ever opening ChatGPT.

Technology can potentially be involved in property valuations, mortgage underwriting, tenant screening, insurance, fraud detection, marketing, lead generation and other decisions associated with housing.

The concern isn't simply whether a computer is involved. The concern is what happens when automated technology uses personal data to help make a decision that can significantly affect someone's life.

Could inaccurate information affect a decision? Could an algorithm unintentionally discriminate? Does the consumer know automated technology was involved? And if the system gets something wrong, can a human review the decision?

Colorado lawmakers have been addressing those questions.

Colorado Senate Bill 24-205 Started an Important Conversation

Colorado enacted Senate Bill 24-205 in 2024, establishing one of the country's early comprehensive frameworks addressing artificial intelligence and algorithmic discrimination.

The original law focused on "high-risk" AI systems used in consequential decisions and established responsibilities for developers and businesses using those systems. Among its consumer protections were requirements addressing disclosure, inaccurate personal information and the opportunity for human review of certain adverse decisions.

Colorado subsequently modified its approach. In 2026, the legislature passed Senate Bill 26-189, which repealed and reenacted the SB 24-205 framework with updated requirements governing what Colorado now calls Automated Decision-Making Technology, or ADMT.

The new provisions are scheduled to take effect January 1, 2027.

Importantly for real estate consumers, Colorado specifically includes housing and financial or lending services among the areas in which an automated decision can qualify as a consequential decision.

That means this isn't an abstract technology issue. It can directly intersect with buying, selling, renting and financing a home.

What Colorado's New Protections Mean for Consumers

Under the updated law, when covered automated technology materially influences certain consequential decisions, consumers receive important protections.

Depending on the circumstances, these include notice concerning the use of the technology, information following an adverse outcome, the ability to request personal data used by the system, the ability to correct factually inaccurate personal information, and the right to request meaningful human review and reconsideration following certain adverse decisions.

The goal isn't to eliminate AI.

It is to create greater transparency and accountability when technology has meaningful influence over decisions affecting people.

How Can You Protect Yourself Right Now?

Regardless of what technology a real estate company, lender, insurer or other business uses, consumers should remain actively involved in their transactions.

1. Ask whether AI or automated technology is being used.

If you receive an unexpected valuation, lending decision, insurance decision or other significant determination, ask whether an automated system played a role.

2. Verify the information AI gives you.

AI can sound extremely confident while being wrong.

Never assume an AI-generated answer about zoning, property taxes, HOA restrictions, water rights, permits, title, financing requirements or a real estate contract is correct simply because it sounds authoritative.

Go back to the original source.

3. Check the data being used about you.

Automated decisions are only as reliable as the information going into them.

An incorrect address, income figure, property characteristic, credit item or other piece of data can potentially affect the output.

If something doesn't make sense, ask what information was used.

4. Ask for human review.

This may become one of the most important protections consumers have as automated decision-making becomes more common.

If technology contributes to an adverse decision, don't assume the computer gets the final word. Ask whether a qualified person can independently review the decision and the underlying information.

5. Don't let AI negotiate your transaction without human judgment.

AI can be excellent for brainstorming negotiation strategies, comparing options and explaining terminology.

But real estate transactions involve context that an AI system may not have: conversations between the parties, property-specific circumstances, inspection findings, deadlines, market conditions, financing issues and contractual obligations.

Use AI to become better informed—not to surrender control of your decisions.

6. Protect your personal information.

Think carefully before uploading contracts, financial statements, identification, loan documents or other sensitive information into an AI platform. Understand what information you're providing and how the service handles that data.

7. Keep important decisions documented.

If an automated decision affects your financing, housing, insurance or transaction, keep the notices, emails, reports and other documentation associated with that decision.

AI Should Empower Consumers, Not Replace Them

The future of real estate probably isn't "AI versus real estate agents."

It's much more likely to be consumers, professionals and AI working together.

A buyer can use AI to analyze properties before touring them. A seller can use it to understand comparable sales and marketing strategies. Consumers can use AI to formulate questions, organize inspection findings and better understand complicated documents. Here at Colorado Realty 4 Less we use it to enhance and anazlyze our current systems as well.

This can make consumers more informed and more involved in their own transactions.

But AI should not become an invisible gatekeeper.

When technology materially influences whether someone receives housing, financing or another important opportunity, consumers deserve to understand that technology's role and have meaningful ways to challenge inaccurate information or adverse outcomes.

That principle was at the heart of Colorado's SB 24-205, and it continues through the state's updated automated-decision-making law.

The Bottom Line

Use AI.

Ask it questions. Research properties. Compare options. Analyze numbers. Learn terminology. Challenge assumptions—including your real estate agent's.

But verify important information, protect your personal data, ask when automated systems are influencing decisions, and insist on human involvement when something doesn't make sense.

AI may become one of the most powerful tools consumers have ever had in a real estate transaction.

The key is making sure you remain the person making the decisions.

This article is for general informational purposes and is not legal advice. Colorado's laws governing automated decision-making technology continue to evolve, and consumers and real estate professionals should consult the current law and appropriate professionals regarding specific situations.