Source: https://www.trec.texas.gov/forms/amendment
Timestamp: 2019-04-25 09:59:34+00:00

Document:
Real Estate Recovery Trust Account and FundAnnouncing The Application Status Tracker!Approved Providers of Legal Update I and II CoursesApproved Providers of the Broker Responsibility CourseBecome a Business Entity Real Estate BrokerBecome a Licensed Residential Service CompanyBecome a Real Estate Sales AgentBecome an Individual Real Estate Broker Continuing Education ProvidersContracts, Forms and NoticesEducation Provider Exam Pass RatesFee Schedule Fingerprint RequirementsInformation About Brokerage Services (IABS) & Consumer Protection NoticeMaintain Your Residential Service Company LicenseName Management ToolQualifying Education Providers Qualifying Real Estate Course ListQualifying Real Estate Education ProvidersRelationship Management Tool User GuideRenew Your Business Entity Real Estate Broker LicenseRenew Your Real Estate Broker LicenseRenew Your Sales Agent LicenseRenewal Education InformationResidential Service Companies (Home Warranties) TREC Benefits for VeteransTREC Processing DatesTips for Posting the IABS and Consumer Protection NoticeWhat is My License Services?
Are there any restrictions on the placement of a license holder's signs?
Yes. TREC may suspend or revoke a license if the license holder places a sign on a property offering it for lease or rental without the written permission of the owner or the owner's authorized agent. [TRELA §1101.652(b)(18)]. Also, although TREC does not regulate where a license holder places a sign, a license holder is responsible for compliance with any rules, restrictions, or regulations covering placement of a sign in their local area. Placement of signs in violation of city ordinance could be considered an act of negligence or incompetence that authorizes disciplinary action against the license holder as well as subject the license holder and possibly even their principal to enforcement actions by the appropriate authorities. [TRELA §1101.652(b)(1)] Typically, sign ordinances prohibit placing a sign on a utility pole, traffic signal box, or in a road median.
I am a Texas broker. Can I broker real estate located in another state?
We don't know, since you will be governed by the laws in that state. Please check with the licensing authority in the state where the brokerage activity will be performed.
I am a sales agent, Sally White. I am sponsored by a broker but want to use an assumed name for my advertisements. Can I use “Sally’s Spectacular Properties” or “White Real Estate” for my business name on my advertising?
You cannot use either company name because each implies that Sally, a sales agent, is in charge. An advertisement cannot in any way imply that a sales agent is the person responsible for the operation of a real estate brokerage. [Rule 535.154(g) ]. A sales agent may use her name with the term “Team” or “Group,” so long as the advertisement also includes the broker’s name, and so long as the broker has registered the team or group name with the Commission.
I am a sales agent. Can TREC review my advertising and advise me whether my advertising complies with TREC Rules?
No. TREC does not review a sales agent’s advertising. TREC will only discuss advertising questions with a broker directly. Your sponsoring broker should review your advertising because your sponsoring broker is responsible for ensuring that your advertising complies with TREC’s advertising rules, and both you and your sponsoring broker can be disciplined if your advertising violates TREC rules. [See §§535.2(g), 535.154, and 535.155 (effective May 15, 2018); TRELA 1101.652(b)(23)]. Your broker must maintain, on a current basis, written policies and procedures to ensure that each sponsored sales agent complies with the Commission’s advertising rules. [See §535.2(i)(6)].
I signed a buyer representation agreement, but I want to work with a different Broker. Can I cancel the agreement?
A buyer representation agreement is intended to be a legal and binding contract. You can ask the broker to release you from the buyer representation agreement. However, TREC does not have the authority to require a broker to release you from the agreement. If the broker refuses to release you from your buyer representation agreement, you should seek the advice of a private attorney.
If I am buying, selling or leasing property for a relative, do I need to disclose that I have a real estate license?
If a buyer's agent is required to disclose his or her status as the buyer’s agent to a listing broker when setting up a showing appointment, must the listing broker also disclose to the buyer's agent that the listing broker represents the seller?
Yes, on the first contact with the license holder representing the buyer. [TRELA §1101.558(b)].
Is a broker required to have a trust or escrow account?
Is the license holder required to provide the "written statement" (IABS Form) to buyer prospects at an open house?
No. A license holder is not required to provide the statutory written statement at the open house. [TRELA §1101.558(c)(3)].
I’m changing sponsoring brokers. Can I take the buyers I represent with me to the new broker if the buyers signed buyer representation agreements?
No. A buyer representation agreement is a private contract between the buyer and the real estate broker, not the sales agent. As such, the buyer would still be represented by the sales agent’s previous broker. The buyer may, however, seek to be released from the buyer representation agreement.
What are the steps to formation of an intermediary relationship?
the buyer executes a Buyer Representation Agreement or other written document that authorizes the broker to act as intermediary and specifies the conduct that is prohibited under TRELA §1101.651(d) in conspicuous bold or underlined print.
What is considered an advertisement?
Under Rules 535.154 and 535.155 (effective May 15, 2018), an advertisement is defined as “any form of communication by or on behalf of a license holder designed to attract the public to use real estate brokerage services and includes, but is not limited to, all publications, brochures, radio or television broadcasts, all electronic media including email, text messages, social media, the Internet, business stationery, business cards, displays, signs and billboards." An advertisement does not include a communication from a license holder to the license holder's current client.
A residential service company is paying me a fee to advertise for it. Do I have to disclose that fee to my client and use a TREC form?
Yes and yes. You must also provide the client with the TREC Disclosure of Relationship with Residential Service Company form (RSC-2).
A residential service contract is part of a transaction but I am not getting paid by the residential service company. Do I still have to use the TREC Disclosure of Relationship with Residential Service Company form (RSC-2)?
Are signs permitted which display the word "broker" or "agent?"
Yes. Although this is not mandatory, it may still be placed on a sign.
Are the disclosure and statutory information requirements applicable to commercial transactions, new home sales, farm and ranch sales or transactions other than residential sales?
Unless an exception applies, the requirements apply to all proposed real estate transactions. The exceptions to the representation disclosure are in TRELA §1101.558(c).
Are there exceptions when the statutory written statement is not required?
(3) the communication is at an open house and the communication concerns that same property.
In addition, the statement is not generally required when the license holder is acting solely as a principal in the transaction.
Can I advertise a service provider such as an inspector, moving company, or repair contractor on my website?
Yes, but if you offer, recommend, or promote the use of a service provider and expect to receive compensation from the service provider when a party uses the service, the ad must disclose that you may receive the compensation. [Rule 535.155 (effective May 15, 2018)] You may advertise an inspector’s services, however, an inspector may not pay a fee or other valuable consideration for (1) a referral, (2) inclusion on a list of inspectors or preferred providers, or a similar arrangement; or (3) inclusion on a list of inspections contingent on other financial agreements. [Rule 535.220(e)(3)] Also, acceptance of a fee from a service provider may violate the Federal Real Estate Settlement Procedures Act (RESPA), which prohibits certain referral fees and kickbacks.
Can a broker be the designated broker for more than one business entity?
Can a broker pay all or a portion of a commission or fee to an unlicensed person?
Can a broker use the words "team" or "group" in the broker's licensed name or assumed business name?
Yes. TREC Rules do not prohibit a broker from using the word “team” or “group” anywhere in a broker’s licensed or assumed business name.
Can a license holder who negotiates a transaction also be employed by a lender and direct a purchaser to that lender to get a loan?
Can a licensed sales agent own his or her own real estate company?
Can a listing broker share a portion of the listing broker’s commission with an attorney who represented the buyer in a real estate transaction?
No. A broker is prohibited from sharing fees with or otherwise compensating the attorney acting as a buyer’s agent unless the attorney holds an active real estate license.
Can a name used in advertising be both an assumed business name and a team name?
No. It will be one or the other. See question regarding the difference between the types of names to figure out which one is appropriate for your situation.
Can a sales agent be the owner of a property management company?
A: Yes. A sales agent may own the firm but the business must be conducted through the sales agent's sponsoring broker.
Can a sales agent have a commission check written to the sales agent’s own corporation or Limited Liability Company? If so, does that entity have to be licensed as a real estate broker?
Can a sales agent have an escrow account?
No. Rule 535.146(b)(2) prohibits a sales agent from having an escrow account. The sales agent must turn all money received over to the sales agent's sponsoring broker.
Can a sales agent receive or pay a commission to a party in a real estate transaction?
Can a sales agent work in a different office than the sponsoring broker’s office?
Can an associated broker refer to himself or herself as a "broker" in an advertisement?
Can an associated broker use his or her own assumed business name in advertising?
Can an attorney get a broker license without first being licensed as a sales agent?
No. A licensed attorney will need to meet all the standard requirements, including education, examination and experience, for issuance of first a real estate sales agent license and then a broker license. However, many of the college and law school courses completed by the attorney could count toward the education requirements. Transcripts would need to be evaluated to determine whether the attorney may receive credit for any applicable courses.
Can an inactive license holder negotiate the purchase, sale, or lease of real property between third parties?
Can an individual broker use an assumed business name in advertising?
Can an individual sales agent use an assumed business name in advertising?
Can an unlicensed person own a real estate company and receive all or a portion of a commission paid to a licensed broker?
Can the intermediary delegate to another license holder the authority to appoint license holders associated with the broker intermediary?
Can the team name used by an associated broker be the same as the assumed name used by the associated broker when he or she is not associating with another broker?
Note on Exclusive Name Use: TREC does not, and is not, required to vet names submitted for registration as an assumed name or team name for exclusivity. A brokerage should decide whether it makes good sense from a liability exposure standpoint to allow an associated broker (or a sales agent who owns a business entity) to use the same name for a team name under the brokerage that they have registered as an assumed name under their own licensed business entity.
Do partnerships need to be licensed if real estate brokerage activity is performed under the partnership name?
Does TREC consider a license holder’s URL or domain name or email address to be advertising?
Does TREC consider a logo that contains the broker’s full name sufficient for the broker name requirement?
Does TREC consider a sign on a building to be an advertisement?
Does TREC consider promotional items and sponsorships to be advertising?
Does a broker have to supervise the daily activities of a sales agent?
A broker is not required to directly supervise sponsored sales agents; this responsibility may be delegated to another person with the required level of experience and expertise to provide proper supervision under the law. [Rule 535.2(e)] However, the broker remains responsible for the authorized acts of the broker’s sales agents [TRELA §1101.803, Rule 535.2(a) ] and has many affirmative duties regarding written policies, record keeping and advising, training, approving advertising for and responding to sales agents. Brokers should be familiar with and follow the duties set out in Rule 535.2 . A broker should also be aware that a complaint filed against a sponsored sales agent is also a complaint against the broker for the purpose of determining the broker’s involvement in the alleged violation and whether the broker properly supervised the sales agent. [Rule 535.141(c) and (d)] A business entity can only provide the proper supervision by the personal involvement of the broker or by the broker’s delegation to a qualified supervisor.
Does the designated broker own 10% or more of a licensed business entity if the designated broker owns 10% or more of another business entity that owns 100% of the licensed business entity?
Yes because the designated broker own 10% or more of the licensed business entity through the broker's ownership of the other entity.
Does the use of the TREC Disclosure of Relationship with Residential Service Company form (RSC-2) apply to both sale and lease transactions?
How do I change my business physical address?
Go online to change your business physical address at no cost. If you submit the change of address form by mail, you must include the paper processing fee.
How do I request inactive status for my sales agent license?
Proceed to “Terminate” the sponsoring broker of record.
If you submit the Application for Inactive Broker or Sales Agent Status form by mail, you must include the $20.00 paper processing.
How long does a license holder have to keep financial and real estate transactions on file?
I am a 25% stockholder in a corporation that holds title to a number of investment properties. I typically negotiate the resale of the properties for the corporation. Must I disclose my licensed status?
I am a broker licensed in another state and would like to apply in Texas. Can I apply online?
No. To apply as an out of state broker, you must submit the paper Application for Broker License by an Individual along with requested documents and the applicable fee.
I am renewing my license for the first time. Am I required to complete the Legal Update I and Legal Update II courses?
Yes. You are under the Sales Apprentice Education (SAE) requirements. Before you can renew your license, you are required to have completed a total of 270 hours of qualifying course hours, and the Legal Update I and II courses.
To determine how many hours have posted to your license record, you may visit the license holder info search feature on our website.
I am renewing my license. How do I know how many classes I need to take for renewal?
License holders must meet Continuing Education (CE) requirements during each two- year license period. CE must include 4 hours in Legal Update I and 4 hours in Legal Update II, and 10 hours in CE elective courses for a total of 18 hours. To determine how many hours have posted to your license record, you can visit our license holder search.
A broker or designated broker of a business entity who sponsor one or more sales agents during their current license period or a delegated supervisor of one or more license holders for a period of six months or more during the supervisor’s current license period must complete the six-hour Broker Responsibility Course as part of the 18-hour CE requirement.
I have a residential service contract and need my toilet repaired. Can TREC help me with that or should I just call a repairman?
No, your contract first requires you to contact the residential service company to request service. They will instruct you on your contract procedure for obtaining repairs. If you have a problem with your residential service company’s response, then you should contact TREC’s residential service ombudsman at (512) 936-3049.
No. All sales agent applicants must complete the required education.
I only represent buyers. Can I advertise that I will rebate a part of my compensation to the buyer?
Yes, as long as the advertisement complies with Rule 535.155 (effective May 15, 2018) regarding any restrictions that might apply. However, a rebate to a buyer from a license holder may be subject to restrictions by the buyer’s lender. You should contact your broker or private attorney to find out how you should notify and obtain the consent of the buyer’s lender to address any impact the rebate may have on the determination regarding the buyer’s creditworthiness.
I want to renew my license active but am unable to complete my CE hours by the license expiration date. Can I get an extension to complete my hours?
Yes. If TREC records do not show that you have completed your CE at the time you submit your renewal application, you must pay a $200 CE deferral fee, or renew in inactive status. Paying the deferral fee allows you to continue to be active in real estate activities and provides an additional 60 days from your expiration date to complete your CE.
If I have a licensed limited partnership, can the general partner be an LLC if a manager of the LLC is a designated broker?
If I represent the seller, can I advertise that I will rebate part of my compensation to the buyer?
Yes, but the ad must disclose that payment of the rebate is subject to the consent of the seller and if the rebate is contingent upon certain restrictions, such as the use of a particular service provider, the ad must contain a disclosure that payment of the rebate is subject to restrictions. [Rule 535.155 (effective May 15, 2018)] A sales agent must also have their sponsoring broker's authorization to offer a rebate.
If a broker does not have a written agreement to represent the buyer, what recourse does the broker have if another broker “steals” a client?
A buyer can choose the broker with whom the buyer wants to work. TREC does not determine what constitutes "procuring cause" or who is entitled to a commission or other compensation. Like a listing agreement, the buyer representation agreement must be in writing and signed by the buyer to be binding.
If a real estate broker has an escrow account, can the broker keep any interest that is earned on the money on deposit?
If a sales agent’s last name is contained in the broker’s licensed or assumed business name, how can the sales agent let the consumer know the agent is not the broker?
Is a broker required to act as an escrow agent or hold the money of others?
No, not unless the broker agrees to do so.
Is a broker responsible for the actions of a sales agent who owns his or her own real estate company?
Is a broker responsible for the actions of a sales agent who transacts business from a separate location?
Is a license holder acting as a principal required to provide a party with written information relating to agency?
Is a license holder required to provide a party with written information relating to agency?
Yes. At the time of first substantive communication with a party relating to a proposed transaction regarding specific real property, a license holder must provide a written notice regarding agency, commonly referred to as “Information About Brokerage Services” or IABS Form. [TRELA §1101.558(b-1)]. TREC publishes the Information About Brokerage Services Form, TREC No. IABS 1-0, that license holders must use to comply with the statute.
Is a license holder required to put their license number on a sign or other advertising?
Is a link to the IABS form required on my website?
Yes. Rule 531.20(b) states that each broker and sales agent must provide a link on its homepage to the IABS Form labeled "Texas Real Estate Commission Information About Brokerage Services". The link must be in at least a 10 point font and in a readily noticeable place on the homepage of the business website of the broker and sales agent.
Is a real estate license necessary in order to be an apartment locator?
Is a residential service company required to be licensed to sell residential service contracts in Texas?
Yes. See the general information and forms available on the TREC website.
Is a “residential service contract” the same as a “home warranty”?
Yes, both terms refer to the same product.
Is it illegal or unethical for an agent to present two offers to the seller at the same time?
The listing agent represents the seller and has a duty to present all offers in a timely manner to the seller. There is no prohibition against a license holder presenting more than one offer at a time to a seller. A seller may receive, review and negotiate several offers simultaneously.
Is the Disclosure of Relationship with Residential Service Company form required for every transaction?
No. This form is required only when a residential service company agrees to pay a license holder for a service provided to or on behalf of the company. The form should indicate which license holders have received or will receive the payment. If a license holder is not receiving a payment from the company, this should be noted as well. Each license holder must sign the form.
Is the Information About Brokerage Services Form promulgated by TREC mandatory?
Is the use of a “net” listing agreement a breach of the broker’s fiduciary duty?
Is there a limit on the number of branch offices a broker can have?
May a broker act as a dual agent?
No. Texas law does not permit dual agency. A license holder may not represent both principals as a dual agent under the revisions to TRELA. Under the current law, a broker must agree to act as an intermediary in accordance with the statute if the broker agrees to represent more than one party in a transaction. [TRELA §1101.561(b)] To the extent a dual agency relationship is created by accident or otherwise, a license holder must resolve the matter by immediate compliance with the notice and consent requirements under TRELA §§1101.558-561 and act as either an intermediary or represent only one of the principals in a transaction while working with the other principal only as a customer.
May a license holder who is a rental locator advertise that they will pay a prospective tenant a portion of their fee received from an apartment complex if the tenant uses the locator’s services?
Yes, as long as the ad complies with Rule 535.155 (effective May 15, 2018), which requires the consent of the party the license holder represents in a transaction. When a rental locator represents an apartment complex, the locator needs the consent of the apartment complex. When the rental locator represents a tenant and not an apartment complex, as demonstrated by a written representation agreement or other evidence of representation, the locator is not required to obtain the consent of the apartment complex because the complex is not his client. Regardless of representation, however, it is misleading advertising to advertise a rebate for an apartment complex that the locator knows has a “no rebate” policy.
Must a person be licensed to locate apartment units for prospective tenants and be paid by the owner of the apartments?
Yes, unless the person is an employee of the owner of the apartments or otherwise exempt, residential rental locators are required to be licensed as either a real estate broker or sales agent.
Online Services is not accepting my temporary password. What do I do?
Copy the temporary password from the email message you received when you registered. Paste it into the “Online Services – Login and Registration” web page when you log in. You will be prompted to create a new password of your own. Once you create your password, you must save it to have future access to your online account.
What are the agency disclosure requirements for a real estate license holder?
A license holder must disclose the fact that he or she represents a party upon the first contact with another party or a license holder representing another party. This disclosure may be oral or in writing.
What can unlicensed office personnel or an unlicensed assistant do?
What if a license holder does not comply with the requirements for forming an intermediary relationship?
Failure of the intermediary broker or the sponsored sales agents to comply with the Intermediary Provisions of TRELA §§ 1101.558-561 may subject them to disciplinary sanctions by the TREC, including but not limited to, revocation, suspension, reprimand and/or an administrative penalty.
What is an associated broker?
What is proof of legal authority to use an assumed business name in Texas?
What is the difference between an assumed business name and a team name?
What is the difference if a broker appoint sales agents to represent the buyer and the seller or if the broker makes no appointments to the principals in a real estate transaction?
If the broker appoints an associated license holder to represent the seller and another associated license holder to represent the buyer, the individual agents may offer advice and opinions regarding the real estate transaction to the party each has been appointed to represent. If the broker does not appoint associated license holders to represent the buyer and seller respectively, then the broker and/or agent may not offer advice and opinions relevant to the real estate transaction to either party and must not favor one principal in the transaction over the other principal. Appointments provide the agents the opportunity to provide a higher level of service to their clients.
What is the required information that must be provided in advertisements such as signs, email and business cards?
All advertisements must comply with TRELA §1101.652(b)(23) and Rules 535.154 and 535.155.
The broker’s name in at least half the size of the largest contact information for any sales agent, associated broker, or team name contained in the advertisement.
A broker’s name includes a broker’s assumed business name that has been registered with TREC.
There is no requirement that a phone number or email address included in an advertisement belong to the broker.
What qualifies as proof of ownership of the business entity?
A resolution, minutes or other official record of the business entity. We also accept copies of tax records which indicate ownership.
When can an agent say that they “sold” a property in an advertisement?
Any agent who worked with the seller or the buyer in a transaction that resulted in the sale of a property may correctly state in an advertisement that they “sold” the property. If the license holder did not participate in that specific transaction, he cannot state or imply that his actions resulted in the sale of that property. An example of a misleading advertisement of this nature would be if a license holder sent out “Just Sold” postcards with her contact information and a picture of a recently sold property that she did not help to sell. She didn’t state that she sold it but an average person reading the card could surely and reasonably imply an erroneous claim of involvement. Another potential example of a misleading advertisement is a license holder who included a list of “Recently Sold Homes” in his advertisement that included many properties where he had no role in the transaction, but he failed to make it clear in the ad which – if any – of those transactions he was involved in. Under Texas law, a license holder may not “create a misleading impression” in their advertisement. A broker must review all ads to ensure this result is avoided.
When does a license holder dealing in property in the license holder's own name have to disclose the fact that they have a real estate license?
It is best to disclose it as early as possible but it must be disclosed in the contract, lease, or in another written document given to the other principal before the agreement is signed. [Rule 535.144(b)] The disclosure is required even if the license holder is on inactive status.
Who registers an assumed business name, team, or alternate name?
Remember -- all these types of names must be registered with TREC before use in advertising.
This form is used to change or add terms to a contract that has already been executed.

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