Texas Principles of -1

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 TABLE OF CONTENTS

Topic No. Title Page No.

Chapter 1
1.8.1. TRELA_Subchapters H-J 3

Chapter 2
2.3. One to Four Family Residential Contract - Resale 17

Chapter 4
4.3.1. Information About Brokerage Services Form 26

Chapter 5
5.7.1. TWC Housing Discrimination Complaint Form 27

Chapter 6
6.2.2. NAR Code of Ethics 31

Chapter 8
8.2.2. Metes and Bounds Diagram 39
8.4.1. Township Diagram 40
8.4.1. Government Survey Method 41

Chapter 12
12.1.1. Residential Real Estate Listing Agreement Exclusive Right to Sell 42
 TEXAS OCCUPATIONS CODE

TITLE 7. PRACTICES AND PROFESSIONS

RELATED TO REAL PROPERTY AND HOUSING

SUBTITLE A.
PROFESSIONS RELATED TO REAL ESTATE

CHAPTER 1101.
REAL ESTATE BROKERS AND SALESPERSONS

CHAPTER 1102.
REAL ESTATE INSPECTORS

As Revised and in Effect on

September 1, 2012

Texas Real Estate Commission

P.O. Box 12188, Austin, Texas 78711-2188
(512) 936-3000
www.trec.texas.gov
Sec. 1101.156. RULES RESTRICTING ADVERTISING OR COMPETITIVE BIDDING ................. 9
Sec. 1101.157. SUBPOENA AUTHORITY ......................................................................................... 10
Sec. 1101.158. ADVISORY COMMITTEES ...................................................................................... 10
Sec. 1101.159. USE OF TECHNOLOGY ............................................................................................ 10
Sec. 1101.160. NEGOTIATED RULEMAKING AND
ALTERNATIVE DISPUTE RESOLUTION PROCEDURES .................................... 10
Sec. 1101.161 GIFTS, GRANTS AND DONATIONS ....................................................................... 11

SUBCHAPTER E. PUBLIC INTEREST INFORMATION AND COMPLAINT PROCEDURES ........ 11

Sec.1101.201. PUBLIC INTEREST INFORMATION ....................................................................... 11
Sec.1101.202. COMPLAINTS............................................................................................................. 11
Sec.1101.203. COMPLAINT INFORMATION .................................................................................. 11
Sec.1101.204. COMPLAINT INVESTIGATION AND DISPOSITION ............................................ 11
Sec. 1101.205. COMPLAINT INVESTIGATION OF CERTIFICATE HOLDER ............................. 12
Sec. 1101.206. PUBLIC PARTICIPATION ......................................................................................... 12

SUBCHAPTER F. TEXAS REAL ESTATE BROKER-LAWYER COMMITTEE ................................ 12

Sec. 1101.251. DEFINITION OF COMMITTEE................................................................................. 12
Sec. 1101.252. COMMITTEE MEMBERSHIP ................................................................................... 12
Sec. 1101.253. TERMS; VACANCIES ................................................................................................ 13
Sec. 1101.254. POWERS AND DUTIES ............................................................................................. 13

SUBCHAPTER G. ACCREDITATION AND APPROVAL OF REAL ESTATE EDUCATIONAL

PROGRAMS AND COURSES OF STUDY ............................................................ 13
Sec. 1101.301. ACCREDITATION OF PROGRAMS AND COURSES OF STUDY ........................ 13
Sec. 1101.302. BOND REQUIRED ..................................................................................................... 13
Sec. 1101.303. APPROVAL OF CONTINUING EDUCATION PROFIDER OR
COURSE OF STUDY .................................................................................................. 14
Sec. 1101.304. EXAMINATION PASSAGE RATE DATA ............................................................... 14
Sec. 1101.305. REVIEW COMMITTEE .............................................................................................. 14

SUBCHAPTER H. LICENSE REQUIREMENTS.................................................................................. 14

Sec. 1101.351. LICENSE REQUIRED ................................................................................................ 14
Sec. 1101.352. LICENSE APPLICATION .......................................................................................... 15
Sec. 1101.3521. CRIMINAL HISTORY RECORD INFORMATION
REQUIREMENT FOR LICENSE ............................................................................... 15
Sec. 1101.353. MORAL CHARACTER DETERMINATION ............................................................ 15
Sec. 1101.354. GENERAL ELIGIBILITY REQUIREMENTS ........................................................... 16

ii
 Sec. 1101.355. ADDITIONAL GENERAL ELIGIBILITY REQUIREMENTS FOR CERTAIN
BUSINESS ENTITIES .................................................................................................16
Sec. 1101.356. BROKER LICENSE: EXPERIENCE AND EDUCATION REQUIREMENTS ........16
Sec. 1101.356. BROKER LICENSE: EXPERIENCE AND EDUCATION REQUIREMENTS ........16
Sec. 1101.357. BROKER LICENSE: ALTERNATE EXPERIENCE REQUIREMENTS
FOR CERTAIN APPLICANTS ...................................................................................16
Sec. 1101.358. SALESPERSON LICENSE: EDUCATION REQUIREMENTS ................................17
Sec. 1101.358. SALESPERSON LICENSE: EDUCATION REQUIREMENTS ................................17
Sec. 1101.359. ALTERNATE EDUCATION REQUIREMENTS FOR CERTAIN
LICENSE HOLDERS ..................................................................................................17
Sec. 1101.360. ELIGIBILITY REQUIREMENTS FOR CERTAIN
NONRESIDENT APPLICANTS .................................................................................17
Sec. 1101.361. ADDITIONAL ELIGIBILITY REQUIREMENTS FOR CERTAIN
NONRESIDENT APPLICANTS .................................................................................18
Sec. 1101.362. WAIVER OF LICENSE REQUIREMENTS: PREVIOUS LICENSE HOLDERS ....18
Sec. 1101.363. ISSUANCE OF LICENSE ...........................................................................................18
Sec. 1101.364. DENIAL OF LICENSE ................................................................................................18
Sec. 1101.365. PROBATIONARY LICENSE .....................................................................................18
Sec. 1101.366. INACTIVE LICENSE: BROKER................................................................................19
Sec. 1101.367. INACTIVE LICENSE: SALESPERSON ....................................................................19

SUBCHAPTER I. EXAMINATIONS....................................................................................................... 19
Sec. 1101.401. EXAMINATION REQUIRED .................................................................................... 19
Sec. 1101.402. WAIVER OF EXAMINATION................................................................................... 20
Sec. 1101.403. ADMINISTRATION OF EXAMINATION; TESTING SERVICE ............................ 20
Sec. 1101.404. EXAMINATION RESULTS ....................................................................................... 20
Sec. 1101.405. REEXAMINATION..................................................................................................... 20

SUBCHAPTER J. LICENSE RENEWAL ................................................................................................ 20

Sec. 1101.451. LICENSE EXPIRATION AND RENEWAL............................................................... 20
Sec. 1101.452. INFORMATION REQUIRED FOR LICENSE RENEWAL ...................................... 21
Sec. 1101.4521. CRIMINAL HISTORY RECORD INFORMATION FOR RENEWAL ..................... 21
Sec. 1101.453. ADDITIONAL RENEWAL REQUIREMENTS FOR
CERTAIN BUSINESS ENTITIES .............................................................................. 21
Sec. 1101.454. SALESPERSON LICENSE RENEWAL ..................................................................... 21
Sec. 1101.455. CONTINUING EDUCATION REQUIREMENTS ..................................................... 22
Sec. 1101.456. EXEMPTION FROM CONTINUING EDUCATION REQUIREMENTS
FOR CERTAIN BROKERS......................................................................................... 23
Sec. 1101.457. DEFERRAL OF CONTINUING EDUCATION REQUIREMENTS ......................... 23

iii
 Sec. 1101.458. ADDITIONAL EDUCATION REQUIREMENTS FOR CERTAIN LICENSE
HOLDERS. .................................................................................................................. 23

SUBCHAPTER K. CERTIFICATE REQUIREMENTS .......................................................................... 22

Sec. 1101.501. CERTIFICATE REQUIRED. ..................................................................................... 23
Sec. 1101.502. ELIGIBILITY REQUIREMENTS FOR CERTIFICATE............................................ 23
Sec. 1101.503. ISSUANCE OF CERTIFICATE .................................................................................. 24
Sec. 1101.504. CERTIFICATE EXPIRATION.................................................................................... 24
Sec. 1101-5041. CRIMINAL HISTORY RECORD INFORMATION REQUIREMENT FOR
CERTIFICATION ....................................................................................................... 24
Sec. 1101.505. DENIAL OF CERTIFICATE....................................................................................... 24
Sec. 1101.506. CHANGE OF ADDRESS ............................................................................................ 24
Sec. 1101.507. DISPLAY OF CERTIFICATE.....................................................................................24

SUBCHAPTER L. PRACTICE BY LICENSE HOLDER........................................................................ 24

Sec. 1101.551. DEFINITIONS ............................................................................................................. 24
Sec. 1101.552. FIXED OFFICE REQUIRED; CHANGE OF ADDRESS;
BRANCH OFFICES. .................................................................................................. 24
Sec. 1101.553. DISPLAY OF LICENSE .............................................................................................. 25
Sec. 1101.554. COPY OF SALESPERSON LICENSE ....................................................................... 25
Sec. 1101.555. NOTICE TO BUYER REGARDING ABSTRACT OR TITLE POLICY .................. 25
Sec. 1101.556. DISCLOSURE OF CERTAIN INFORMATION RELATING TO OCCUPANTS .... 25
Sec. 1101.557. ACTING AS AGENT; REGULATION OF CERTAIN TRANSACTIONS ............... 25
Sec. 1101.558. REPRESENTATION DISCLOSURE .......................................................................... 26
Sec. 1101.559. BROKER ACTING AS INTERMEDIARY ................................................................ 27
Sec. 1101.560. ASSOCIATED LICENSE HOLDER ACTING AS INTERMEDIARY ..................... 27
Sec. 1101.561. DUTIES OF INTERMEDIARY PREVAIL................................................................. 28

SUBCHAPTER M. REAL ESTATE RECOVERY TRUST ACCOUNT ................................................ 28

Sec. 1101.601. REAL ESTATE RECOVERY TRUST ACCOUNT ................................................... 28
Sec. 1101.602. ENTITLEMENT TO REIMBURSEMENT ................................................................. 28
Sec. 1101.603. PAYMENTS INTO TRUST ACCOUNT .................................................................... 28
Sec. 1101.604. MANAGEMENT OF TRUST ACCOUNT ................................................................. 29
Sec. 1101.605. DEADLINE FOR ACTION; NOTICE TO COMMISSION........................................ 29
Sec. 1101.606. CLAIM FOR PAYMENT FROM TRUST ACCOUNT .............................................. 29
Sec. 1101.607. ISSUES AT HEARING ............................................................................................... 29
Sec. 1101.608. COMMISSION RESPONSE........................................................................................ 30
Sec. 1101.609. COURT ORDER FOR PAYMENT ............................................................................. 30

iv
Sec. 1101.303-.351
Sec. 1101.303. APPROVAL OF CONTINU- committee shall consist of:
ING EDUCATION PROVIDER OR (1) at least one commission member;
COURSE OF STUDY. (a) If the commission
determines that an applicant for approval as a (2) at least one member of the commission
continuing education provider satisfies the staff;
requirements of this subchapter or Section (3) individuals licensed under this chapter or
1102.205 and any rule adopted under this Chapter 1102; and
subchapter or Section 1102.205, the commission
may authorize the applicant to offer continuing (4) a representative from the Texas Real
education for a two-year period. Estate Research Center.
(b) If the commission determines that an (b) A committee formed under this section
applicant for approval of a continuing education shall review and evaluate any factor causing an
course of study satisfies the requirements of this educational program's poor performance and
subchapter or Section 1102.205 and any rule report findings and recommendations to
adopted under this subchapter or Section improve performance to the program and to the
1102.205, the commission may authorize the commission.
applicant to offer the course of study for a two- (c) A committee formed under this section
year period. may not revoke the accreditation of an
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, educational program. The commission may
eff. June 1, 2003.) (Amended by: Acts 2007, 80th temporarily suspend a program in the same
Leg., R.S., Ch. 1411, Sec. 15, eff. September 1, manner as a license under Subchapter N.
2007.) (Added by Acts 2007, 80th Leg., R.S., Ch. 1411,
Sec. 16, eff. September 1, 2007.)
Sec. 1101.304. EXAMINATION PASSAGE
RATE DATA. (a) The commission shall adopt
rules regarding the collection and publication of SUBCHAPTER H.
data relating to examination passage rates for LICENSE REQUIREMENTS
graduates of accredited educational programs.
(b) Rules adopted under this section must Sec. 1101.351. LICENSE REQUIRED. (a)
provide for a method to: Unless a person holds a license issued under
(1) calculate the examination passage rate; this chapter, the person may not:
(2) collect the relevant data from the (1) act as or represent that the person is a
examination administrator or the accredited broker or salesperson; or
program; and (2) act as a residential rental locator.
(3) post the examination passage rate data on
the commission's Internet website, in a manner (a-1) Unless a business entity holds a license
aggregated by educational program and by issued under this chapter, the business entity
license group. may not act as a broker.
(c) In determining the educational program a (b) An applicant for a broker or salesperson
graduate is affiliated with for purposes of this license may not act as a broker or salesperson
section, the educational program is the program until the person receives the license evidencing
the graduate last attended. that authority.
(Added by Acts 2007, 80th Leg., R.S., Ch. 1411, (c) A licensed salesperson may not act or
Sec. 16, eff. September 1, 2007.) attempt to act as a broker or salesperson unless
the salesperson is associated with a licensed
broker and is acting for that broker.
Sec. 1101.305. REVIEW COMMITTEE. (a)
The commission may appoint a committee to (Added by Acts 2001, 77th Leg., ch. 1421, Sec.
review the performance of an educational 2, eff. June 1, 2003.) (Amended by: Acts 2011,
program performing below the standards set by 82nd Leg., R.S., Ch. 1064, Sec. 5, eff.
the commission under Section 1101.301. The September 1, 2011.)

14
 Sec. 1101.352-.353
Sec. 1101.352. LICENSE APPLICATION. (1) provided by the individual under this
(a) Each applicant for a broker or salesperson section; and
license must submit an application on a form
prescribed by the commission. (2) made available to the commission by the
Department of Public Safety, the Federal
(b) Each applicant for a broker or salesperson Bureau of Investigation, and any other criminal
license must disclose in the license application justice agency under Chapter 411, Government
whether the applicant has: Code.
(1) entered a plea of guilty or nolo contendere (d) The commission may:
to a felony; or
(2) been convicted of a felony and the time for (1) enter into an agreement with the
appeal has elapsed or the judgment or conviction Department of Public Safety to administer a
has been affirmed on appeal. criminal history check required under this
section; and
(c) The disclosure under Subsection (b) must be
provided even if an order has granted community (2) authorize the Department of Public Safety
supervision suspending the imposition of the to collect from each applicant the costs incurred
sentence. by the department in conducting the criminal
history check.
(d) At the time an application is submitted under
Subsection (a), each applicant shall provide the (Added by Acts 2007, 80th Leg., R.S., Ch. 297,
commission with the applicant's current mailing Sec. 5, eff. September 1, 2007.)
address and telephone number, and e-mail
address if available. The applicant shall notify
the commission of any change in the applicant's Sec. 1101.353. MORAL CHARACTER
mailing or e-mail address or telephone number DETERMINATION. (a) If before applying
during the time the application is pending. for a license under this chapter a person
requests that the commission determine whether
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, the person's moral character complies with the
eff. June 1, 2003; Amended by Acts 2003, 78th commission's moral character requirements for
Leg., ch. 15, Sec. 4, eff. Sept. 1, 2003; Acts 2003, licensing under this chapter and pays the fee
78th Leg., ch. 1276, Sec. 14A.158(a), eff. Sept. 1, prescribed by Section 1101.152, the
2003.) (Amended by: Acts 2011, 82nd Leg., R.S., commission shall make its determination of the
Ch. 1064, Sec. 6, eff. September 1, 2011.) person's moral character.
(b) Not later than the 30th day after the date
Sec. 1101.3521. CRIMINAL HISTORY the commission makes its determination, the
RECORD INFORMATION REQUIRE- commission shall notify the person of the
MENT FOR LICENSE. (a) The commission determination.
shall require that an applicant for a license or (c) If a person applies for a license after
renewal of an unexpired license submit a receiving notice of a determination, the
complete and legible set of fingerprints, on a commission may conduct a supplemental moral
form prescribed by the commission, to the character determination of the person. The
commission or to the Department of Public supplemental determination may cover only the
Safety for the purpose of obtaining criminal period after the date the person requests a moral
history record information from the Department character determination under this section.
of Public Safety and the Federal Bureau of
Investigation. (d) The commission may issue a provisional
moral character determination. The
(b) The commission shall refuse to issue a commission by rule shall adopt reasonable
license to or renew the license of a person who terms for issuing a provisional moral character
does not comply with the requirement of determination.
Subsection (a). (Added by Acts 2001, 77th Leg., ch. 1421, Sec.
(c) The commission shall conduct a criminal 2, eff. June 1, 2003.) (Amended by: Acts 2005,
history check of each applicant for a license or 79th Leg., Ch. 825, Sec. 3, eff. September 1,
renewal of a license using information: 2005.)

15
 Sec. 1101.354-.357(1)(B)

Sec. 1101.354. GENERAL ELIGIBILITY Sec. 1101.356. BROKER LICENSE:

REQUIREMENTS. To be eligible to receive a EXPERIENCE AND EDUCATION RE-
license under this chapter, a person must: QUIREMENTS. (a) An applicant for a broker
(1) at the time of application: license must provide to the commission
satisfactory evidence that the applicant:
(A) be at least 18 years of age; (1) has had at least four years of active
(B) be a citizen of the United States or a experience in this state as a license holder
lawfully admitted alien; and during the 60 months preceding the date the
application is filed; and
(C) be a resident of this state;
(2) has successfully completed at least 60
(2) satisfy the commission as to the applicant's semester hours, or equivalent classroom hours,
honesty, trustworthiness, and integrity; of postsecondary education, including:
(3) demonstrate competence based on an (A) at least 18 semester hours or equivalent
examination under Subchapter I; classroom hours of core real estate courses, two
semester hours of which must be real estate
(4) complete the required courses of study, brokerage; and
including any required core real estate courses (B) at least 42 hours of core real estate
prescribed under this chapter; and courses or related courses accepted by the
(5) complete at least: commission.
(A) three classroom hours of course work on (b) Subsection (a) does not apply to an
federal, state, and local laws governing housing applicant who, at the time of application, is
discrimination, housing credit discrimination, and licensed as a real estate broker by another state
community reinvestment; or that has license requirements comparable to the
requirements of this state.
(B) three semester hours of course work on (b-1)The commission by rule shall establish
constitutional law. what constitutes active experience for purposes
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, of this section and Section 1101.357.
eff. June 1, 2003.) (c) Repealed by Acts 2011, 82nd Leg., R.S.,
Ch. 1064, Sec. 24, eff. September 1, 2011.
Sec. 1101.355. ADDITIONAL GENERAL (Added by Acts 2001, 77th Leg., ch. 1421, Sec.
ELIGIBILITY REQUIREMENTS FOR BUSI- 2, eff. June 1, 2003. Amended by Acts 2003,
NESS ENTITIES. (a) To be eligible for a 78th Leg., ch. 1276, Sec. 14A.152(b), eff. Sept.
license under this chapter, a business entity must: 1, 2003.) (Amended by: Acts 2007, 80th Leg.,
(1) designate one of its managing officers as its R.S., Ch. 297, Sec. 6, eff. September 1, 2007.
agent for purposes of this chapter; and Acts 2011, 82nd Leg., R.S., Ch. 1064, Sec. 8,
eff. September 1, 2011. Acts 2011, 82nd Leg.,
(2) provide proof that the entity maintains errors R.S., Ch. 1064, Sec. 24, eff. September 1, 2011.)
and omissions insurance with a minimum annual
limit of $1 million for each occurrence if the
designated agent owns less than 10 percent of the Sec. 1101.357. BROKER LICENSE:
business entity. ALTERNATE EXPERIENCE
REQUIREMENTS FOR CERTAIN APPLI-
(b) A business entity may not act as a broker CANTS. An applicant for a broker license who
unless the entity's designated agent is a licensed does not satisfy the experience requirements of
broker in active status and good standing Section 1101.356 must provide to the
according to the commission's records. commission satisfactory evidence that:
(c) A business entity that receives compensation (1) the applicant:
on behalf of a license holder must be licensed
as a broker under this chapter. (A) is a licensed real estate broker in another
state;
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2,
eff. June 1, 2003.) (Amended by: Acts 2011, 82nd (B) has had at least four years of active
Leg., R.S., Ch. 1064, Sec. 7, eff. September 1, experience in that state as a licensed real estate
2011.) broker or salesperson during the 60 months
16
 Sec. 1101.357(1)(B)-.360(c)(3)

preceding the date the application is filed; and Sec. 1101.359. ALTERNATE
(C) has satisfied the educational requirements EDUCATION REQUIREMENTS FOR
prescribed by Section 1101.356; or CERTAIN LICENSE HOLDERS. An
applicant for a broker license who is not subject
(2) the applicant was licensed in this state as a to the education requirements of Section
broker in the year preceding the date the 1101.356(a)(2) and an applicant for a
application is filed. salesperson license who is not subject to the
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, education requirements of Section 1101.358 or
eff. June 1, 2003.) (Amended by: Acts 2011, 1101.454 must provide to the commission
82nd Leg., R.S., Ch. 1064, Sec. 9, eff. September satisfactory evidence that the applicant has
completed the number of classroom hours of
1, 2011.) continuing education that would have been
required for a timely renewal under Section
Sec. 1101.358. SALESPERSON LI- 1101.455 during the two years preceding the
CENSE: EDUCATION REQUIREMENTS. date the application is filed.
(a) An applicant for a salesperson license must (Added by Acts 2001, 77th Leg., ch. 1421, Sec.
provide to the commission satisfactory evidence 2, eff. June 1, 2003.)
that the applicant has completed at least 12
semester hours, or equivalent classroom hours, of
postsecondary education consisting of: Sec. 1101.360. ELIGIBILITY REQUIRE-
(1)at least four semester hours of core real MENTS FOR CERTAIN NONRESIDENT
estate courses on principles of real estate; and APPLICANTS. (a) A resident of another state
who is not a licensed real estate broker and who
(2)at least two semester hours of each of the was formerly licensed in this state as a broker
following core real estate courses: or salesperson may apply for a license under
(A) agency law; this chapter not later than the first anniversary
(B) contract law; of the date of the expiration of the former
license.
(C) contract forms and addendums; and
(b) A nonresident applicant is subject to the
(D) real estate finance. same license requirements as a resident. The
(b) The commission shall waive the education commission may refuse to issue a license to a
requirements of Subsection (a) if the applicant nonresident applicant for the same reasons that
has been licensed in this state as a broker or it may refuse to issue a license to a resident
salesperson within the six months preceding the applicant.
date the application is filed.
(c) A nonresident applicant must submit with
(c) If an applicant for a salesperson license was the application an irrevocable consent to a legal
licensed as a salesperson within the six months action against the applicant in the court of any
preceding the date the application is filed and the county in this state in which a cause of action
license was issued under the conditions may arise or in which the plaintiff may reside.
prescribed by Section 1101.454, the commission The action may be commenced by service of
shall require the applicant to provide the process or pleading authorized by the laws of
evidence of successful completion of education this state or by delivery of process on the
requirements that would have been required if the
license had been maintained without interruption administrator or assistant administrator of the
during the preceding six months. commission. The consent must:
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, (1) stipulate that the service of process or
pleading is valid and binding in all courts as if
eff. June 1, 2003. Amended by Acts 2003, 78th personal service had been made on the
Leg., ch. 1276, Sec. 14A.152(c), eff. Sept. 1, nonresident in this state;
2003.) (Amended by: Acts 2005, 79th Leg., Ch.
825, Sec. 4, eff. September 1, 2005. Acts 2011, (2) be acknowledged; and
82nd Leg., R.S., Ch. 1064, Sec. 10, eff. September (3) if made by a corporation, be authenticated
1, 2011.) by its seal.

17
Sec. 1101.360(d)-.365(a)

(d) A service of process or pleading served on was licensed under this chapter within the six
the commission under this section shall be by years preceding the date the application is filed.
duplicate copies. One copy shall be filed in the (Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2,
commission's office, and the other copy shall be eff. June 1, 2003.)
forwarded by registered mail to the last known
principal address recorded in the commission's
records for the nonresident against whom the Sec. 1101.363. ISSUANCE OF LICENSE.
process or pleading is directed. (a) The commission shall issue an appropriate
license to an applicant who meets the
(e) A default judgment in an action commenced requirements for a license.
as provided by this section may not be granted:
(b) The commission may issue an inactive
(1) unless the commission certifies that a copy salesperson license to a person who applies for a
of the process or pleading was mailed to the salesperson license and satisfies all requirements
defendant as provided by Subsection (d); and for the license. The person may not act as a
(2) until the 21st day after the date the process salesperson unless the person is sponsored by a
or pleading is mailed to the defendant. licensed broker who has notified the commission
as required by Section 1101.367(b).
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, Notwithstanding Section 1101.367(b), the
eff. June 1, 2003.) licensed broker is not required to pay the fee
required by that subsection.
Sec. 1101.361. ADDITIONAL ELIGIBIL- (c) A license remains in effect for the period
ITY REQUIREMENTS FOR CERTAIN prescribed by the commission if the license
NONRESIDENT APPLICANTS. (a) holder complies with this chapter and pays the
Notwithstanding Section 1101.360, a nonresident appropriate renewal fees.
applicant for a license who resides in a
municipality whose boundary is contiguous at (Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2,
any point with the boundary of a municipality in eff. June 1, 2003. Amended by Acts 2003, 78th
this state is eligible to be licensed under this Leg., ch. 15, Sec. 5, eff. Sept. 1, 2003; Acts 2003,
chapter in the same manner as a resident of this 78th Leg., ch. 1276, Sec. 14A.158(b), eff. Sept. 1,
state if the nonresident has been a resident of that 2003.)
municipality for at least the 60 days preceding
the date the application is filed. Sec. 1101.364. DENIAL OF LICENSE. (a)
(b) A person licensed under this section shall The commission shall immediately give written
maintain at all times a place of business in the notice to the applicant of the commission's denial
municipality in which the person resides or in the of a license.
municipality in this state that is contiguous to the (b) A person whose license application is denied
municipality in which the person resides. The under this section is entitled to a hearing under
place of business must meet all the requirements Section 1101.657.
of Section 1101.552. A place of business located
in the municipality in which the person resides is (c) Repealed by Acts 2007, 80th Leg., R.S., Ch.
considered to be in this state. 1411, Sec. 59(2), eff. September 1, 2007.
(c) A person licensed under this section may not (d) Repealed by Acts 2007, 80th Leg., R.S., Ch.
maintain a place of business at another location 1411, Sec. 59(2), eff. September 1, 2007.
in this state unless the person complies with (e) Repealed by Acts 2007, 80th Leg., R.S., Ch.
Section 1101.356 or 1101.357. 1411, Sec. 59(2), eff. September 1, 2007.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, (Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2,
eff. June 1, 2003.) eff. June 1, 2003.) (Amended by: Acts 2007, 80th
Leg., R.S., Ch. 1411, Sec. 17, eff. September 1,
Sec. 1101.362. WAIVER OF LICENSE 2007. Acts 2007, 80th Leg., R.S., Ch. 1411, Sec.
REQUIREMENTS: PREVIOUS LICENSE 59(2), eff. September 1, 2007.)
HOLDERS. The commission by rule may
waive some or all of the requirements for a
license under this chapter for an applicant who Sec. 1101.365. PROBATIONARY LI-
CENSE. (a) The commission may issue a
18
 Sec. 1101.365(a)-.401(d)

probationary license. Sec. 1101.367. INACTIVE LICENSE:

(b) The commission by rule shall adopt SALESPERSON. (a) When the association of
reasonable terms for issuing a probationary a salesperson with the salesperson's sponsoring
license. broker terminates, the broker shall immediately
return the salesperson license to the
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, commission. A salesperson license returned
eff. June 1, 2003.)
under this subsection is inactive.

Sec. 1101.366. INACTIVE LICENSE: (b) The commission may remove a salesperson
BROKER. (a) The commission may place on license from inactive status under Subsection
inactive status the license of a broker if the (a) if, before the expiration date of the
broker: salesperson license, a licensed broker files a
request with the commission advising the
(1) is not acting as a broker; commission that the broker assumes
(2) is not sponsoring a salesperson; and sponsorship of the salesperson, accompanied by
the appropriate fee.
(3) submits a written application to the
commission before the expiration date of the (c) As a condition of returning to active status,
broker's license. an inactive salesperson whose license is not
subject to the education requirements of Section
(b) The commission may place on inactive 1101.454 must provide to the commission proof
status the license of a broker whose license has of attending at least 15 hours of continuing
expired if the broker applies for inactive status on education as specified by Section 1101.455
a form prescribed by the commission not later during the two years preceding the date the
than the first anniversary of the expiration date of application to return to active status is filed.
the broker's license.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec.
(c) A broker applying for inactive status shall 2, eff. June 1, 2003. Amended by Acts 2003,
terminate the broker's association with each 78th Leg., ch. 15, Sec. 6, eff. Sept. 1, 2003;
salesperson sponsored by the broker by giving Acts 2003, 78th Leg., ch. 1276, Sec. 14A.158(c),
written notice to each salesperson before the 30th eff. Sept. 1, 2003.) (Amended by: Acts 2011,
day preceding the date the broker applies for 82nd Leg., R.S., Ch. 1064, Sec. 11, eff.
inactive status. September 1, 2011.)
(d) A broker on inactive status:
(1) may not perform any activity regulated SUBCHAPTER I. EXAMINATIONS
under this chapter; and
(2) must pay annual renewal fees. Sec. 1101.401. EXAMINATION RE-
QUIRED. (a) The competency requirement
(e) The commission shall maintain a list of each prescribed under Section 1101.354(3) shall be
broker whose license is on inactive status. established by an examination prepared or
(f) The commission shall remove a broker's contracted for by the commission.
license from inactive status if the broker: (b) The commission shall determine the time
(1) submits an application to the commission; and place in the state for offering the
examination.
(2) pays the required fee; and
(c) The examination must be of sufficient
(3) submits proof of attending at least 15 scope in the judgment of the commission to
classroom hours of continuing education as determine whether a person is competent to act
specified by Section 1101.455 during the two as a broker or salesperson in a manner that will
years preceding the date the application under protect the public.
Subdivision (1) is filed.
(d) The examination for a salesperson license
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, must be less exacting and less stringent than the
eff. June 1, 2003.) broker examination.

19
Sec. 1101.401(e)-.451(a)

(e) The commission shall provide each regarding the administration of the
applicant with study material and references on examination;
which the examination is based. (2) collect fees directly from applicants for
(f) An applicant must satisfy the examination administering the examination; or
requirement not later than one year after the date (3) administer the examination at specific
the license application is filed. locations and specified frequencies.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2,
eff. June 1, 2003.) (Amended by: Acts 2011, (e) The commission shall adopt rules and
standards as necessary to implement this
82nd Leg., R.S., Ch. 1064, Sec. 12, eff. September section.
1, 2011.)
(Added by Acts 2001, 77th Leg., ch. 1421, Sec.
2, eff. June 1, 2003.)
Sec. 1101.402. WAIVER OF EXAMINA-
TION. The commission shall waive the
examination requirement for an applicant for: Sec. 1101.404. EXAMINATION RE-
(1) a broker license if: SULTS. (a) Not later than the 30th day after
the date an examination is administered, the
(A) the applicant was previously licensed in commission shall notify each examinee of the
this state as a broker; and results of the examination. If an examination is
graded or reviewed by a national testing
(B) the application is filed before the first service, the commission shall notify each
anniversary of the expiration date of that license; examinee of the results of the examination not
and later than the 14th day after the date the
(2) a salesperson license if: commission receives the results from the testing
service.
(A) the applicant was previously licensed in
this state as a broker or salesperson; and (b) If the notice of the results of an
examination graded or reviewed by a national
(B) the application is filed before the first testing service will be delayed for more than 90
anniversary of the expiration date of that license. days after the examination date, the commission
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, shall notify each examinee of the reason for the
eff. June 1, 2003.) delay before the 90th day.
(c) If requested in writing by a person who
Sec. 1101.403. ADMINISTRATION OF EX- fails an examination, the commission shall
AMINATION; TESTING SERVICE. (a) provide to the person an analysis of the person's
The commission shall administer any performance on the examination.
examination required by this chapter or Chapter (Added by Acts 2001, 77th Leg., ch. 1421, Sec.
1102 unless the commission enters into an 2, eff. June 1, 2003.)
agreement with a testing service to administer the
examination.
(b) The commission may accept an examination Sec. 1101.405. REEXAMINATION. An
administered by a testing service if the applicant who fails an examination may apply
for reexamination by filing a request
commission retains the authority to establish the accompanied by the proper fee.
scope and type of the examination.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec.
(c) The commission may negotiate an 2, eff. June 1, 2003.)
agreement with a testing service relating to
examination development, scheduling, site
arrangements, administration, grading, reporting,
and analysis. SUBCHAPTER J. LICENSE RENEWAL
(d) The commission may require a testing
service to: Sec. 1101.451. LICENSE EXPIRATION
AND RENEWAL. (a) The commission may
(1) correspond directly with license applicants issue or renew a license for a period not to

20
 Sec. 1101.451(a)-.454(a)

exceed 24 months. to a felony; or

(b) The commission by rule may adopt a system (2) been convicted of a felony and the time
under which licenses expire on various dates for appeal has elapsed or the judgment or
during the year. The commission shall adjust the conviction has been affirmed on appeal.
date for payment of the renewal fees accordingly. (c) The disclosure under Subsection (b) must
(c) For a year in which the license expiration be provided even if an order has granted
date is changed, renewal fees payable shall be community supervision suspending the
prorated on a monthly basis so that each license imposition of the sentence.
holder pays only that portion of the fee that is (Added by Acts 2001, 77th Leg., ch. 1421, Sec.
allocable to the number of months during which 2, eff. June 1, 2003.) (Amended by: Acts 2011,
the license is valid. On renewal of the license on
the new expiration date, the total renewal fee is 82nd Leg., R.S., Ch. 1064, Sec. 14, eff.
September 1, 2011.)
payable.
(d) Except as provided by Subsection (e), a Sec. 1101.4521. CRIMINAL HISTORY
renewal fee for a license under this chapter may RECORD INFORMATION FOR RENEW-
not exceed, calculated on an annual basis, the AL. An applicant for the renewal of an
amount of the sum of the fees established under unexpired license must comply with the
Sections 1101.152, 1101.154, and 1101.603. criminal history record check requirements of
(e) A person whose license has been expired for Section 1101.3521.
90 days or less may renew the license by paying (Added by Acts 2007, 80th Leg., R.S., Ch. 297,
to the commission a fee equal to 1-1/2 times the Sec. 7, eff. September 1, 2007.)
required renewal fee. If a license has been
expired for more than 90 days but less than six
months, the person may renew the license by Sec. 1101.453. ADDITIONAL RENEWAL
paying to the commission a fee equal to two REQUIREMENTS FOR BUSINESS ENTI-
times the required renewal fee. TIES. (a) To renew a license under this
chapter, a business entity must:
(f) If a person's license has been expired for six (1) designate one of its managing officers as
months or longer, the person may not renew the its agent for purposes of this chapter; and
license. The person may obtain a new license by
submitting to reexamination and complying with (2) provide proof that the entity maintains
the requirements and procedures for obtaining an errors and omissions insurance with a minimum
original license. annual limit of $1 million for each occurrence if
the designated agent owns less than 10 percent
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, of the business entity.
eff. June 1, 2003.) (Amended by: Acts 2007, 80th
Leg., R.S., Ch. 1411, Sec. 18, eff. September 1, (b) A business entity may not act as a broker
2007. Acts 2007, 80th Leg., R.S., Ch. 1411, Sec. unless the entity's designated agent is a licensed
19, eff. September 1, 2007. Acts 2011, 82nd Leg., broker in active status and good standing
R.S., Ch. 1064, Sec. 13, eff. September 1, 2011.) according to the commission's records.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec.
Sec. 1101.452. INFORMATION RE- 2, eff. June 1, 2003.) (Amended by: Acts 2011,
QUIRED FOR LICENSE RENEWAL. (a) To 82nd Leg., R.S., Ch. 1064, Sec. 15, eff.
renew an active license that is not subject to the September 1, 2011.)
education requirements of Section 1101.454, the
license holder must provide to the commission Sec. 1101.454. SALESPERSON LICENSE
proof of compliance with the continuing RENEWAL. (a) An applicant applying for the
education requirements of Section 1101.455. first renewal of a salesperson license must
provide to the commission satisfactory evidence
(b) Each applicant for the renewal of a license of completion of at least 18 semester hours, or
must disclose in the license application whether equivalent classroom hours, of core real estate
the applicant has: courses.
(1) entered a plea of guilty or nolo contendere

21
Sec. 1101.455)-.455(k)

(b) Repealed by Acts 2005, 79th Leg., Ch. 825, tenant law;
Sec. 15, eff. September 1, 2005. (4) agency law;
(c) Repealed by Acts 2005, 79th Leg., Ch. 825, (5) antitrust laws;
Sec. 15, eff. September 1, 2005.
(6) Subchapter E, Chapter 17, Business &
(d) The commission may not waive the Commerce Code;
requirements for renewal under this section.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, (7) disclosures to buyers, landlords, tenants,
and sellers;
eff. June 1, 2003. Amended by Acts 2003, 78th
Leg., ch. 1276, Sec. 14A.152(d), eff. Sept. 1, (8) current contract and addendum forms;
2003.) (Amended by: Acts 2005, 79th Leg., Ch.
(9) unauthorized practice of law;
825, Sec. 5, eff. September 1, 2005. Acts 2005,
79th Leg., Ch. 825, Sec. 15, eff. September 1, (10) case studies involving violations of laws
2005. Acts 2011, 82nd Leg., R.S., Ch. 1064, Sec. and regulations;
16, eff. September 1, 2011.)
(11) current Federal Housing Administration
and Department of Veterans Affairs
Sec. 1101.455. CONTINUING EDUCA- regulations;
TION REQUIREMENTS. (a) In this section, (12) tax laws;
"property tax consulting laws and legal issues"
includes the Tax Code, preparation of property (13) property tax consulting laws and legal
tax reports, the unauthorized practice of law, issues; or
agency law, tax law, law relating to property tax (14) other legal topics approved by the
or property assessment, deceptive trade practices, commission.
contract forms and addendums, and other legal
topics approved by the commission. (f) The remaining nine hours may be devoted
to other real estate-related topics approved by
(b) A license holder who is not subject to the the commission.
education requirements of Section 1101.454 must
attend during the term of the current license at (g) The commission may consider courses
least 15 classroom hours of continuing education equivalent to those described by Subsections (e)
courses approved by the commission. and (f) for continuing education credit.
(c) The commission by rule may: (h) The commission shall automatically
approve the following courses as courses that
(1) prescribe the title, content, and duration of satisfy the mandatory continuing education
continuing education courses that a license requirements of Subsection (f):
holder must attend to renew a license; and
(2) approve as a substitute for the classroom (1) core real estate courses; and
attendance required by Subsection (b): (2) real estate-related courses approved by the
State Bar of Texas for minimum continuing
(A) relevant educational experience; and legal education participatory credit.
(B) correspondence courses. (i) The commission may not require an
(d) In addition, the commission may approve examination for a course under this section
supervised video instruction as a course that may unless the course is a correspondence course or
be applied toward satisfaction of the classroom a course offered by an alternative delivery
hours of continuing education courses required system, including delivery by computer.
by Subsection (b). (j) Daily classroom course segments must be at
(e) At least six of the continuing education least one hour and not more than 10 hours.
hours required by Subsection (b) must cover the (k) Notwithstanding the number of hours
following legal topics: required by Subsection (e), a member of the
(1) commission rules; legislature licensed under this chapter is only
required to complete three hours of continuing
(2) fair housing laws; education on the legal topics under Subsection
(3) Property Code issues, including landlord- (e).

22
 Sec. 1101.455(l)-.502(a)(2)

(l) An online course offered under this section Sec. 1101.458. ADDITIONAL EDUCA-
may not be completed in less than 24 hours. TION REQUIREMENTS FOR CERTAIN
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, LICENSE HOLDERS. (a) A broker who
sponsors a salesperson, or a license holder who
eff. June 1, 2003. Amended by Acts 2003, 78th supervises another license holder, must attend
Leg., ch. 1276, Sec. 14A.159(a), eff. Sept. 1, during the term of the current license at least six
2003.) (Amended by: Acts 2005, 79th Leg., Ch.
classroom hours of broker responsibility
825, Sec. 6, eff. September 1, 2005. Acts 2007, education courses approved by the commission.
80th Leg., R.S., Ch. 297, Sec. 8, eff. September 1,
2007. Acts 2007, 80th Leg., R.S., Ch. 1411, Sec. (b) The commission by rule shall prescribe the
20, eff. September 1, 2007. Acts 2009, 81st Leg., title, content, and duration of broker
R.S., Ch. 87, Sec. 27.001(72), eff. September 1, responsibility education courses required under
2009. Acts 2011, 82nd Leg., R.S., Ch. 1064, Sec. this section.
17, eff. September 1, 2011.)
(c) Broker responsibility education course
hours may be used to satisfy the hours
Sec. 1101.456. EXEMPTION FROM CON- described by Section 1101.455(f).
TINUING EDUCATION REQUIREMENTS
FOR CERTAIN BROKERS. Notwithstanding (d) This section does not apply to a broker
any other provision of this chapter, a broker who, who is exempt from continuing education
before October 31, 1991, qualified under former requirements under Section 1101.456.
Section 7A(f), The Real Estate License Act
(Article 6573a, Vernon's Texas Civil Statutes), as (Added by Acts 2011, 82nd Leg., R.S., Ch. 1064,
added by Section 1.041, Chapter 553, Acts of the Sec. 18, eff. September 1, 2011.)
72nd Legislature, Regular Session, 1991, for an
exemption from continuing education
requirements is not required to comply with the SUBCHAPTER K.
mandatory continuing education requirements of CERTIFICATE REQUIREMENTS
this subchapter to renew the broker's license.
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, Sec. 1101.501. CERTIFICATE RE-
eff. June 1, 2003.) QUIRED. A person may not sell, buy, lease,
or transfer an easement or right-of-way for
another, for compensation or with the
Sec. 1101.457. DEFERRAL OF CONTINU- expectation of receiving compensation, for use
ING EDUCATION REQUIREMENTS. (a) in connection with telecommunication, utility,
The commission by rule may establish railroad, or pipeline service unless the person:
procedures under which an applicant may have
the applicant's license issued, renewed, or (1) holds a license issued under this chapter;
returned to active status before the applicant or
completes continuing education requirements.
(2) holds a certificate of registration issued
(b) The commission may require an applicant under this subchapter.
under this section to:
(Added by Acts 2001, 77th Leg., ch. 1421, Sec.
(1) pay a fee, not to exceed $200, in addition to 2, eff. June 1, 2003.)
any fee for late renewal of a license under this
chapter; and
Sec. 1101.502. ELIGIBILITY REQUIRE-
(2) complete the required continuing education MENTS FOR CERTIFICATE. (a) To be
not later than the 60th day after the date the eligible to receive a certificate of registration or
license is issued, renewed, or returned to active a renewal certificate under this subchapter, a
status. person must be:
(Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, (1) at least 18 years of age; and
eff. June 1, 2003.) (Amended by: Acts 2007, 80th
Leg., R.S., Ch. 1411, Sec. 21, eff. September 1, (2) a citizen of the United States or a lawfully
2007.) admitted alien.

23
Contract Concerning Page of 9 11-2-2015
PROMULGATED BY THE(Address
TEXASofREAL ESTATE COMMISSION (TREC)
Property)
ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE)
NOTICE: Not For Use For Condominium Transactions EQUAL HOUSING
OPPORTUNITY

1. PARTIES: The parties to this contract are

(Seller) and (Buyer).
Seller agrees to sell and convey to Buyer and Buyer agrees to buy from Seller the Property defined
below.
2. PROPERTY: The land, improvements and accessories are collectively referred to as the “Property”.
A. LAND: Lot Block ,
Addition, City of , County of ,
Texas, known as
(address/zip code), or as described on attached exhibit.
B. IMPROVEMENTS: The house, garage and all other fixtures and improvements attached to the
above-described real property, including without limitation, the following permanently installed
and built-in items, if any: all equipment and appliances, valances, screens, shutters, awnings,
wall-to-wall carpeting, mirrors, ceiling fans, attic fans, mail boxes, television antennas, mounts
and brackets for televisions and speakers, heating and air-conditioning units, security and fire
detection equipment, wiring, plumbing and lighting fixtures, chandeliers, water softener system,
kitchen equipment, garage door openers, cleaning equipment, shrubbery, landscaping, outdoor
cooking equipment, and all other property owned by Seller and attached to the above described
real property.
C. ACCESSORIES: The following described related accessories, if any: window air conditioning units,
stove, fireplace screens, curtains and rods, blinds, window shades, draperies and rods, door keys,
mailbox keys, above ground pool, swimming pool equipment and maintenance accessories,
artificial fireplace logs, and controls for: (i) garage doors, (ii) entry gates, and (iii) other
improvements and accessories.
D. EXCLUSIONS: The following improvements and accessories will be retained by Seller and must
be removed prior to delivery of possession:
.
3. SALES PRICE:
A. Cash portion of Sales Price payable by Buyer at closing .............................. $
B. Sum of all financing described in the attached: Third Party Financing Addendum,
Loan Assumption Addendum, Seller Financing Addendum .............. $
C. Sales Price (Sum of A and B) .................................................................. $
4. LICENSE HOLDER DISCLOSURE: Texas law requires a real estate license holder who is a party to a
transaction or acting on behalf of a spouse, parent, child, business entity in which the license holder
owns more than 10%, or a trust for which the license holder acts as a trustee or of which the license
holder or the license holder’s spouse, parent or child is a beneficiary, to notify the other party in
writing before entering into a contract of sale. Disclose if applicable:
.
5. EARNEST MONEY: Upon execution of this contract by all parties, Buyer shall deposit
$_____________ as earnest money with , as escrow agent,
at _______________________________________________ (address). Buyer shall deposit
additional earnest money of $____________ with escrow agent within _____ days after the effective
date of this contract. If Buyer fails to deposit the earnest money as required by this contract, Buyer
will be in default.
6.TITLE POLICY AND SURVEY:
A. TITLE POLICY: Seller shall furnish to Buyer at  Seller’s  Buyer’s expense an owner policy of title
insurance (Title Policy) issued by (Title Company) in the
amount of the Sales Price, dated at or after closing, insuring Buyer against loss under the
provisions of the Title Policy, subject to the promulgated exclusions (including existing building and
zoning ordinances) and the following exceptions:
(1) Restrictive covenants common to the platted subdivision in which the Property is located.
(2) The standard printed exception for standby fees, taxes and assessments.
(3) Liens created as part of the financing described in Paragraph 3.
(4) Utility easements created by the dedication deed or plat of the subdivision in which the Property
is located.

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 2 of 9 11-2-2015
(Address of Property)

(5) Reservations or exceptions otherwise permitted by this contract or as may be approved

by Buyer in writing.
(6) The standard printed exception as to marital rights.
(7) The standard printed exception as to waters, tidelands, beaches, streams, and related
matters.
(8) The standard printed exception as to discrepancies, conflicts, shortages in area or
boundary lines, encroachments or protrusions, or overlapping improvements: (i) will
not be amended or deleted from the title policy; or (ii) will be amended to read,
"shortages in area" at the expense of Buyer Seller.
B. COMMITMENT: Within 20 days after the Title Company receives a copy of this contract,
Seller shall furnish to Buyer a commitment for title insurance (Commitment) and, at Buyer's
expense, legible copies of restrictive covenants and documents evidencing exceptions in the
Commitment (Exception Documents) other than the standard printed exceptions. Seller
authorizes the Title Company to deliver the Commitment and Exception Documents to Buyer
at Buyer's address shown in Paragraph 21. If the Commitment and Exception Documents are
not delivered to Buyer within the specified time, the time for delivery will be automatically
extended up to 15 days or 3 days before the Closing Date, whichever is earlier. If, due to
factors beyond Seller’s control, the Commitment and Exception Documents are not delivered
within the time required, Buyer may terminate this contract and the earnest money will be
refunded to Buyer.
C. SURVEY: The survey must be made by a registered professional land surveyor acceptable to
the Title Company and Buyer’s lender(s). (Check one box only)
(1) Within days after the effective date of this contract, Seller shall furnish to Buyer
and Title Company Seller's existing survey of the Property and a Residential Real Property
Affidavit promulgated by the Texas Department of Insurance (T-47 Affidavit). If Seller
fails to furnish the existing survey or affidavit within the time prescribed, Buyer
shall obtain a new survey at Seller's expense no later than 3 days prior to Closing
Date. If the existing survey or affidavit is not acceptable to Title Company or Buyer's
lender(s), Buyer shall obtain a new survey at Seller's Buyer's expense no later than 3
days prior to Closing Date.
(2) Within days after the effective date of this contract, Buyer shall obtain a new
survey at Buyer's expense. Buyer is deemed to receive the survey on the date of actual
receipt or the date specified in this paragraph, whichever is earlier.
(3) Within days after the effective date of this contract, Seller, at Seller's expense
shall furnish a new survey to Buyer.
D. OBJECTIONS: Buyer may object in writing to defects, exceptions, or encumbrances to title:
disclosed on the survey other than items 6A(1) through (7) above; disclosed in the
Commitment other than items 6A(1) through (8) above; or which prohibit the following use
or activity: .
Buyer must object the earlier of (i) the Closing Date or (ii) days after Buyer receives
the Commitment, Exception Documents, and the survey. Buyer’s failure to object within the
time allowed will constitute a waiver of Buyer’s right to object; except that the requirements
in Schedule C of the Commitment are not waived by Buyer. Provided Seller is not obligated
to incur any expense, Seller shall cure the timely objections of Buyer or any third party lender
within 15 days after Seller receives the objections and the Closing Date will be extended as
necessary. If objections are not cured within such 15 day period, this contract will terminate
and the earnest money will be refunded to Buyer unless Buyer waives the objections.
E. TITLE NOTICES:
(1) ABSTRACT OR TITLE POLICY: Broker advises Buyer to have an abstract of title covering
the Property examined by an attorney of Buyer’s selection, or Buyer should be furnished
with or obtain a Title Policy. If a Title Policy is furnished, the Commitment should be
promptly reviewed by an attorney of Buyer’s choice due to the time limitations on
Buyer’s right to object.
(2) MEMBERSHIP IN PROPERTY OWNERS ASSOCIATION(S): The Property is is not
subject to mandatory membership in a property owners association(s). If the Property is
subject to mandatory membership in a property owners association(s), Seller notifies
Buyer under §5.012, Texas Property Code, that, as a purchaser of property in the
residential community identified in Paragraph 2A in which the Property is located, you are
obligated to be a member of the property owners association(s). Restrictive covenants
governing the use and occupancy of the Property and all dedicatory instruments
governing the establishment, maintenance, or operation of this residential community
have been or will be recorded in the Real Property Records of the county in which the
Property is located. Copies of the restrictive covenants and dedicatory instruments may
be obtained from the county clerk. You are obligated to pay assessments to the
property owners association(s). The amount of the assessments is subject to

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 3 of 9 11-2-2015
(Address of Property)

change. Your failure to pay the assessments could result in enforcement of the
association’s lien on and the foreclosure of the Property.
Section 207.003, Property Code, entitles an owner to receive copies of any document that
governs the establishment, maintenance, or operation of a subdivision, including, but not
limited to, restrictions, bylaws, rules and regulations, and a resale certificate from a
property owners' association. A resale certificate contains information including, but not
limited to, statements specifying the amount and frequency of regular assessments and
the style and cause number of lawsuits to which the property owners' association is a
party, other than lawsuits relating to unpaid ad valorem taxes of an individual member of
the association. These documents must be made available to you by the property owners'
association or the association's agent on your request.
If Buyer is concerned about these matters, the TREC promulgated Addendum for
Property Subject to Mandatory Membership in a Property Owners Association(s)
should be used.
(3) STATUTORY TAX DISTRICTS: If the Property is situated in a utility or other statutorily
created district providing water, sewer, drainage, or flood control facilities and services,
Chapter 49, Texas Water Code, requires Seller to deliver and Buyer to sign the statutory
notice relating to the tax rate, bonded indebtedness, or standby fee of the district prior to
final execution of this contract.
(4) TIDE WATERS: If the Property abuts the tidally influenced waters of the state, §33.135,
Texas Natural Resources Code, requires a notice regarding coastal area property to be
included in the contract. An addendum containing the notice promulgated by TREC or
required by the parties must be used.
(5) ANNEXATION: If the Property is located outside the limits of a municipality, Seller notifies
Buyer under §5.011, Texas Property Code, that the Property may now or later be included
in the extraterritorial jurisdiction of a municipality and may now or later be subject to
annexation by the municipality. Each municipality maintains a map that depicts its
boundaries and extraterritorial jurisdiction. To determine if the Property is located within a
municipality’s extraterritorial jurisdiction or is likely to be located within a municipality’s
extraterritorial jurisdiction, contact all municipalities located in the general proximity of
the Property for further information.
(6) PROPERTY LOCATED IN A CERTIFICATED SERVICE AREA OF A UTILITY SERVICE
PROVIDER: Notice required by §13.257, Water Code: The real property, described in
Paragraph 2, that you are about to purchase may be located in a certificated water or
sewer service area, which is authorized by law to provide water or sewer service to the
properties in the certificated area. If your property is located in a certificated area there
may be special costs or charges that you will be required to pay before you can receive
water or sewer service. There may be a period required to construct lines or other
facilities necessary to provide water or sewer service to your property. You are advised to
determine if the property is in a certificated area and contact the utility service provider
to determine the cost that you will be required to pay and the period, if any, that is
required to provide water or sewer service to your property. The undersigned Buyer
hereby acknowledges receipt of the foregoing notice at or before the execution of a
binding contract for the purchase of the real property described in Paragraph 2 or at
closing of purchase of the real property.
(7) PUBLIC IMPROVEMENT DISTRICTS: If the Property is in a public improvement district,
§5.014, Property Code, requires Seller to notify Buyer as follows: As a purchaser of this
parcel of real property you are obligated to pay an assessment to a municipality or
county for an improvement project undertaken by a public improvement district under
Chapter 372, Local Government Code. The assessment may be due annually or in
periodic installments. More information concerning the amount of the assessment and the
due dates of that assessment may be obtained from the municipality or county levying
the assessment. The amount of the assessments is subject to change. Your failure to pay
the assessments could result in a lien on and the foreclosure of your property.
(8) TRANSFER FEES: If the Property is subject to a private transfer fee obligation, §5.205,
Property Code, requires Seller to notify Buyer as follows: The private transfer fee
obligation may be governed by Chapter 5, Subchapter G of the Texas Property Code.
(9) PROPANE GAS SYSTEM SERVICE AREA: If the Property is located in a propane gas
system service area owned by a distribution system retailer, Seller must give Buyer
written notice as required by §141.010, Texas Utilities Code. An addendum containing
the notice approved by TREC or required by the parties should be used.
(10) NOTICE OF WATER LEVEL FLUCTUATIONS: If the Property adjoins an impoundment of
water, including a reservoir or lake, constructed and maintained under Chapter 11, Water
Code, that has a storage capacity of at least 5,000 acre-feet at the impoundment’s
normal operating level, Seller hereby notifies Buyer: “The water level of the
impoundment of water adjoining the Property fluctuates for various reasons, including as

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 4 of 9 11-2-2015
(Address of Property)

a result of: (1) an entity lawfully exercising its right to use the water stored in the
impoundment; or (2) drought or flood conditions.”
7.PROPERTY CONDITION:
A. ACCESS, INSPECTIONS AND UTILITIES: Seller shall permit Buyer and Buyer’s agents access
to the Property at reasonable times. Buyer may have the Property inspected by inspectors
selected by Buyer and licensed by TREC or otherwise permitted by law to make inspections.
Any hydrostatic testing must be separately authorized by Seller in writing. Seller at Seller's
expense shall immediately cause existing utilities to be turned on and shall keep the utilities
on during the time this contract is in effect.
B. SELLER'S DISCLOSURE NOTICE PURSUANT TO §5.008, TEXAS PROPERTY CODE (Notice):
(Check one box only)
 (1) Buyer has received the Notice.
 (2) Buyer has not received the Notice. Within days after the effective date of this
contract, Seller shall deliver the Notice to Buyer. If Buyer does not receive the Notice,
Buyer may terminate this contract at any time prior to the closing and the earnest money
will be refunded to Buyer. If Seller delivers the Notice, Buyer may terminate this contract
for any reason within 7 days after Buyer receives the Notice or prior to the closing,
whichever first occurs, and the earnest money will be refunded to Buyer.
 (3)The Seller is not required to furnish the notice under the Texas Property Code.
C. SELLER’S DISCLOSURE OF LEAD-BASED PAINT AND LEAD-BASED PAINT HAZARDS is
required by Federal law for a residential dwelling constructed prior to 1978.
D. ACCEPTANCE OF PROPERTY CONDITION: “As Is” means the present condition of the Property
with any and all defects and without warranty except for the warranties of title and the
warranties in this contract. Buyer’s agreement to accept the Property As Is under Paragraph
7D(1) or (2) does not preclude Buyer from inspecting the Property under Paragraph 7A, from
negotiating repairs or treatments in a subsequent amendment, or from terminating this
contract during the Option Period, if any.
(Check one box only)
 (1) Buyer accepts the Property As Is.
 (2) Buyer accepts the Property As Is provided Seller, at Seller’s expense, shall complete the
following specific repairs and treatments:
.
(Do not insert general phrases, such as “subject to inspections” that do not identify
specific repairs and treatments.)
E. LENDER REQUIRED REPAIRS AND TREATMENTS: Unless otherwise agreed in writing, neither
party is obligated to pay for lender required repairs, which includes treatment for wood
destroying insects. If the parties do not agree to pay for the lender required repairs or
treatments, this contract will terminate and the earnest money will be refunded to Buyer. If
the cost of lender required repairs and treatments exceeds 5% of the Sales Price, Buyer may
terminate this contract and the earnest money will be refunded to Buyer.
F. COMPLETION OF REPAIRS AND TREATMENTS: Unless otherwise agreed in writing: (i) Seller
shall complete all agreed repairs and treatments prior to the Closing Date; and (ii) all required
permits must be obtained, and repairs and treatments must be performed by persons who are
licensed to provide such repairs or treatments or, if no license is required by law, are
commercially engaged in the trade of providing such repairs or treatments. At Buyer’s
election, any transferable warranties received by Seller with respect to the repairs and
treatments will be transferred to Buyer at Buyer’s expense. If Seller fails to complete any
agreed repairs and treatments prior to the Closing Date, Buyer may exercise remedies under
Paragraph 15 or extend the Closing Date up to 5 days if necessary for Seller to complete the
repairs and treatments.
G. ENVIRONMENTAL MATTERS: Buyer is advised that the presence of wetlands, toxic substances,
including asbestos and wastes or other environmental hazards, or the presence of a
threatened or endangered species or its habitat may affect Buyer’s intended use of the
Property. If Buyer is concerned about these matters, an addendum promulgated by TREC or
required by the parties should be used.
H. RESIDENTIAL SERVICE CONTRACTS: Buyer may purchase a residential service contract from a
residential service company licensed by TREC. If Buyer purchases a residential service
contract, Seller shall reimburse Buyer at closing for the cost of the residential service contract
in an amount not exceeding $ . Buyer should review any residential service
contract for the scope of coverage, exclusions and limitations. The purchase of a residential
service contract is optional. Similar coverage may be purchased from various
companies authorized to do business in Texas.
8.BROKERS’ FEES: All obligations of the parties for payment of brokers’ fees are contained in
separate written agreements.

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 5 of 9 11-2-2015
(Address of Property)
9.CLOSING:
A. The closing of the sale will be on or before , 20 , or within 7
days after objections made under Paragraph 6D have been cured or waived, whichever date
is later (Closing Date). If either party fails to close the sale by the Closing Date, the non-
defaulting party may exercise the remedies contained in Paragraph 15.
B. At closing:
(1) Seller shall execute and deliver a general warranty deed conveying title to the Property
to Buyer and showing no additional exceptions to those permitted in Paragraph 6 and
furnish tax statements or certificates showing no delinquent taxes on the Property.
(2) Buyer shall pay the Sales Price in good funds acceptable to the escrow agent.
(3) Seller and Buyer shall execute and deliver any notices, statements, certificates,
affidavits, releases, loan documents and other documents reasonably required for the
closing of the sale and the issuance of the Title Policy.
(4) There will be no liens, assessments, or security interests against the Property which will
not be satisfied out of the sales proceeds unless securing the payment of any loans
assumed by Buyer and assumed loans will not be in default.
(5)If the Property is subject to a residential lease, Seller shall transfer security deposits (as
defined under §92.102, Property Code), if any, to Buyer. In such an event, Buyer shall
deliver to the tenant a signed statement acknowledging that the Buyer has acquired the
Property and is responsible for the return of the security deposit, and specifying the
exact dollar amount of the security deposit.
10.POSSESSION:
A. Buyer’s Possession: Seller shall deliver to Buyer possession of the Property in its present or
required condition, ordinary wear and tear excepted: upon closing and funding
according to a temporary residential lease form promulgated by TREC or other written
lease required by the parties. Any possession by Buyer prior to closing or by Seller after
closing which is not authorized by a written lease will establish a tenancy at sufferance
relationship between the parties. Consult your insurance agent prior to change of
ownership and possession because insurance coverage may be limited or
terminated. The absence of a written lease or appropriate insurance coverage may
expose the parties to economic loss.
B. Leases:
(1)After the Effective Date, Seller may not execute any lease (including but not limited to
mineral leases) or convey any interest in the Property without Buyer’s written consent.
(2) If the Property is subject to any lease to which Seller is a party, Seller shall deliver to
Buyer copies of the lease(s) and any move-in condition form signed by the tenant
within 7 days after the Effective Date of the contract.
11.SPECIAL PROVISIONS: (Insert only factual statements and business details applicable to
the sale. TREC rules prohibit license holders from adding factual statements or business
details for which a contract addendum, lease or other form has been promulgated by TREC for
mandatory use.)

12. SETTLEMENT AND OTHER EXPENSES:

A. The following expenses must be paid at or prior to closing:
(1) Expenses payable by Seller (Seller's Expenses):
(a) Releases of existing liens, including prepayment penalties and recording fees;
release of Seller’s loan liability; tax statements or certificates; preparation of deed;
one-half of escrow fee; and other expenses payable by Seller under this contract.
(b) Seller shall also pay an amount not to exceed $ to be applied in the
following order: Buyer’s Expenses which Buyer is prohibited from paying by FHA, VA,
Texas Veterans Land Board or other governmental loan programs, and then to other
Buyer’s Expenses as allowed by the lender.
(2) Expenses payable by Buyer (Buyer's Expenses): Appraisal fees; loan application fees;
origination charges; credit reports; preparation of loan documents; interest on the
notes from date of disbursement to one month prior to dates of first monthly
payments; recording fees; copies of easements and restrictions; loan title policy with
endorsements required by lender; loan-related inspection fees; photos; amortization
schedules; one-half of escrow fee; all prepaid items, including required premiums for
flood and hazard insurance, reserve deposits for insurance, ad valorem taxes and
special governmental assessments; final compliance inspection; courier fee; repair
inspection; underwriting fee; wire transfer fee; expenses incident to any loan; Private
Initialed for identification by Buyer and Seller TREC NO. 20-13
Contract Concerning Page 6 of 9 11-2-2015
(Address of Property)

Mortgage Insurance Premium (PMI), VA Loan Funding Fee, or FHA Mortgage

Insurance Premium (MIP) as required by the lender; and other expenses payable by
Buyer under this contract.
B. If any expense exceeds an amount expressly stated in this contract for such expense to
be paid by a party, that party may terminate this contract unless the other party agrees to
pay such excess. Buyer may not pay charges and fees expressly prohibited by FHA, VA,
Texas Veterans Land Board or other governmental loan program regulations.
13. PRORATIONS: Taxes for the current year, interest, maintenance fees, assessments, dues
and rents will be prorated through the Closing Date. The tax proration may be calculated
taking into consideration any change in exemptions that will affect the current year's taxes.
If taxes for the current year vary from the amount prorated at closing, the parties shall
adjust the prorations when tax statements for the current year are available. If taxes are not
paid at or prior to closing, Buyer shall pay taxes for the current year.
14. CASUALTY LOSS: If any part of the Property is damaged or destroyed by fire or other
casualty after the effective date of this contract, Seller shall restore the Property to its
previous condition as soon as reasonably possible, but in any event by the Closing Date. If
Seller fails to do so due to factors beyond Seller’s control, Buyer may (a) terminate this
contract and the earnest money will be refunded to Buyer (b) extend the time for
performance up to 15 days and the Closing Date will be extended as necessary or (c) accept
the Property in its damaged condition with an assignment of insurance proceeds, if permitted
by Seller’s insurance carrier, and receive credit from Seller at closing in the amount of the
deductible under the insurance policy. Seller’s obligations under this paragraph are
independent of any other obligations of Seller under this contract.
15. DEFAULT: If Buyer fails to comply with this contract, Buyer will be in default, and Seller may
(a) enforce specific performance, seek such other relief as may be provided by law, or both,
or (b) terminate this contract and receive the earnest money as liquidated damages, thereby
releasing both parties from this contract. If Seller fails to comply with this contract, Seller will
be in default and Buyer may (a) enforce specific performance, seek such other relief as may
be provided by law, or both, or (b) terminate this contract and receive the earnest money,
thereby releasing both parties from this contract.
16. MEDIATION: It is the policy of the State of Texas to encourage resolution of disputes
through alternative dispute resolution procedures such as mediation. Any dispute between
Seller and Buyer related to this contract which is not resolved through informal discussion
will be submitted to a mutually acceptable mediation service or provider. The parties to the
mediation shall bear the mediation costs equally. This paragraph does not preclude a party
from seeking equitable relief from a court of competent jurisdiction.
17. ATTORNEY'S FEES: A Buyer, Seller, Listing Broker, Other Broker, or escrow agent who
prevails in any legal proceeding related to this contract is entitled to recover reasonable
attorney’s fees and all costs of such proceeding.
18. ESCROW:
A. ESCROW: The escrow agent is not (i) a party to this contract and does not have liability
for the performance or nonperformance of any party to this contract, (ii) liable for interest
on the earnest money and (iii) liable for the loss of any earnest money caused by the
failure of any financial institution in which the earnest money has been deposited unless
the financial institution is acting as escrow agent.
B. EXPENSES: At closing, the earnest money must be applied first to any cash down
payment, then to Buyer's Expenses and any excess refunded to Buyer. If no closing
occurs, escrow agent may: (i) require a written release of liability of the escrow agent
from all parties, (ii) require payment of unpaid expenses incurred on behalf of a party,
and (iii) only deduct from the earnest money the amount of unpaid expenses incurred on
behalf of the party receiving the earnest money.
C. DEMAND: Upon termination of this contract, either party or the escrow agent may send
a release of earnest money to each party and the parties shall execute counterparts of
the release and deliver same to the escrow agent. If either party fails to execute the
release, either party may make a written demand to the escrow agent for the earnest
money. If only one party makes written demand for the earnest money, escrow agent
shall promptly provide a copy of the demand to the other party. If escrow agent does
not receive written objection to the demand from the other party within 15 days, escrow
agent may disburse the earnest money to the party making demand reduced by the
amount of unpaid expenses incurred on behalf of the party receiving the earnest money
and escrow agent may pay the same to the creditors. If escrow agent complies with the
provisions of this paragraph, each party hereby releases escrow agent from all adverse
claims related to the disbursal of the earnest money.

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 7 of 9 11-2-2015
(Address of Property)

D. DAMAGES: Any party who wrongfully fails or refuses to sign a release acceptable to the
escrow agent within 7 days of receipt of the request will be liable to the other party for (i)
damages; (ii) the earnest money; (iii) reasonable attorney's fees; and (iv) all costs of suit.
E. NOTICES: Escrow agent's notices will be effective when sent in compliance with Paragraph
21. Notice of objection to the demand will be deemed effective upon receipt by escrow
agent.
19. REPRESENTATIONS: All covenants, representations and warranties in this contract survive
closing. If any representation of Seller in this contract is untrue on the Closing Date, Seller
will be in default. Unless expressly prohibited by written agreement, Seller may continue to
show the Property and receive, negotiate and accept back up offers.
20. FEDERAL TAX REQUIREMENTS: If Seller is a "foreign person,” as defined by applicable
law, or if Seller fails to deliver an affidavit to Buyer that Seller is not a "foreign person,” then
Buyer shall withhold from the sales proceeds an amount sufficient to comply with applicable
tax law and deliver the same to the Internal Revenue Service together with appropriate tax
forms. Internal Revenue Service regulations require filing written reports if currency in
excess of specified amounts is received in the transaction.
21. NOTICES: All notices from one party to the other must be in writing and are effective when
mailed to, hand-delivered at, or transmitted by fax or electronic transmission as follows:

To Buyer To Seller
at: at:

Phone: ( ) Phone: ( )

Fax: ( ) Fax: ( )

E-mail: E-mail:

22. AGREEMENT OF PARTIES: This contract contains the entire agreement of the parties and
cannot be changed except by their written agreement. Addenda which are a part of this
contract are (Check all applicable boxes):

Third Party Financing Addendum Environmental Assessment, Threatened or

  Endangered Species and Wetlands
 Seller Financing Addendum  Addendum
 
 Addendum for Property Subject to Seller’s Temporary Residential Lease
Mandatory Membership in a Property 
 Owners Association Short Sale Addendum
 
 Buyer’s Temporary Residential Lease Addendum for Property Located Seaward
  of the Gulf Intracoastal Waterway
 Loan Assumption Addendum 
 Addendum for Seller's Disclosure of
 Addendum for Sale of Other Property by  Information on Lead-based Paint and Lead-
Buyer  based Paint Hazards as Required by
  Federal Law
 Addendum for Reservation of Oil, Gas 
and Other Minerals Addendum for Property in a Propane Gas

 System Service Area
 Addendum for "Back-Up" Contract  
 Other (list):

 Addendum for Coastal Area Property

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 8 of 9 11-2-2015
(Address of Property)

23. TERMINATION OPTION: For nominal consideration, the receipt of which is hereby
acknowledged by Seller, and Buyer's agreement to pay Seller $ (Option Fee)
within 3 days after the effective date of this contract, Seller grants Buyer the unrestricted right to
terminate this contract by giving notice of termination to Seller within days after the
effective date of this contract (Option Period). Notices under this paragraph must be given by
5:00 p.m. (local time where the Property is located) by the date specified. If no dollar amount is
stated as the Option Fee or if Buyer fails to pay the Option Fee to Seller within the time
prescribed, this paragraph will not be a part of this contract and Buyer shall not have the
unrestricted right to terminate this contract. If Buyer gives notice of termination within the time
prescribed, the Option Fee will not be refunded; however, any earnest money will be refunded to
Buyer. The Option Fee will will not be credited to the Sales Price at closing. Time is of the
essence for this paragraph and strict compliance with the time for performance is
required.
24. CONSULT AN ATTORNEY BEFORE SIGNING: TREC rules prohibit real estate license holders
from giving legal advice. READ THIS CONTRACT CAREFULLY.

Buyer's Seller's
Attorney is: Attorney is:

Phone: ( ) Phone: ( )

Fax: ( ) Fax: ( )

E-mail: E-mail:

EXECUTED the day of , 20 (EFFECTIVE DATE).

(BROKER: FILL IN THE DATE OF FINAL ACCEPTANCE.)

Buyer Seller

Buyer Seller

The form of this contract has been approved by the Texas Real Estate Commission. TREC forms are intended for
use only by trained real estate license holders. No representation is made as to the legal validity or adequacy of any
provision in any specific transactions. It is not intended for complex transactions. Texas Real Estate Commission,
P.O. Box 12188, Austin, TX 78711-2188, (512) 936-3000 (http://www.trec.texas.gov) TREC NO. 20-13. This form
replaces TREC NO. 20-12.

Initialed for identification by Buyer and Seller TREC NO. 20-13

Contract Concerning Page 9 of 9 11-2-2015
(Address of Property)

BROKER INFORMATION
(Print name(s) only. Do not sign)

Other Broker Firm License No. Listing Broker Firm License No.

represents  Buyer only as Buyer’s agent represents  Seller and Buyer as an intermediary
 Seller as Listing Broker’s subagent  Seller only as Seller’s agent

Associate’s Name License No. Listing Associate’s Name License No.

Licensed Supervisor of Associate License No. Licensed Supervisor of Listing Associate License No.

Other Broker's Address Fax Listing Broker’s Office Address Fax

City State Zip City State Zip

Associate’s Email Address Phone Listing Associate’s Email Address Phone

Selling Associate’s Name License No.

Licensed Supervisor of Selling Associate License No.

Selling Associate’s Office Address Fax

City State Zip

Selling Associate’s Email Address Phone

Listing Broker has agreed to pay Other Broker of the total sales price when the Listing Broker’s
fee is received. Escrow agent is authorized and directed to pay other Broker from Listing Broker’s fee at closing.

OPTION FEE RECEIPT

Receipt of $ (Option Fee) in the form of is acknowledged.

Seller or Listing Broker Date

CONTRACT AND EARNEST MONEY RECEIPT

Receipt of Contract and $ Earnest Money in the form of

is acknowledged.

Escrow Agent: Date:

By:
Email Address
Phone: ( )
Address

Fax: ( )
City State Zip

Initialed for identification by Buyer and Seller TREC NO. 20-13

 11-2-2015
Information About Brokerage Services
Texas law requires all real estate license holders to give the following informaƟon about
brokerage services to prospecƟve buyers, tenants, sellers and landlords.

TYPES OF REAL ESTATE LICENSE HOLDERS:

.
• A BROKER is responsible for all brokerage acƟviƟes, including acts performed by sales agents sponsored by the broker.
• A SALES AGENT must be sponsored by a broker and works with clients on behalf of the broker.

A BROKER’S MINIMUM DUTIES REQUIRED BY LAW (A client is the person or party that the broker represents):
• Put the interests of the client above all others, including the broker’s own interests;
• Inform the client of any material informaƟon about the property or transacƟon received by the broker;
• Answer the client’s quesƟons and present any offer to or counter-offer from the client; and
• Treat all parƟes to a real estate transacƟon honestly and fairly.

A LICENSE HOLDER CAN REPRESENT A PARTY IN A REAL ESTATE TRANSACTION:

AS AGENT FOR OWNER (SELLER/LANDLORD): The broker becomes the property owner's agent through an agreement with the owner,
usually in a wriƩen lisƟng to sell or property management agreement. An owner's agent must perform the broker’s minimum duƟes
above and must inform the owner of any material informaƟon about the property or transacƟon known by the agent, including
informaƟon disclosed to the agent or subagent by the buyer or buyer’s agent.

AS AGENT FOR BUYER/TENANT: The broker becomes the buyer/tenant's agent by agreeing to represent the buyer, usually through a
wriƩen representaƟon agreement. A buyer's agent must perform the broker’s minimum duƟes above and must inform the buyer of any
material informaƟon about the property or transacƟon known by the agent, including informaƟon disclosed to the agent by the seller or
seller’s agent.

AS AGENT FOR BOTH - INTERMEDIARY: To act as an intermediary between the parƟes the broker must first obtain the wriƩen
agreement of each party to the transacƟon. The wriƩen agreement must state who will pay the broker and, in conspicuous bold or
underlined print, set forth the broker's obligaƟons as an intermediary. A broker who acts as an intermediary:
• Must treat all parƟes to the transacƟon imparƟally and fairly;
• May, with the parƟes' wriƩen consent, appoint a different license holder associated with the broker to each party (owner and
buyer) to communicate with, provide opinions and advice to, and carry out the instrucƟons of each party to the transacƟon.
• Must not, unless specifically authorized in wriƟng to do so by the party, disclose:
ᴑ that the owner will accept a price less than the wriƩen asking price;
ᴑ that the buyer/tenant will pay a price greater than the price submiƩed in a wriƩen offer; and
ᴑ any confidenƟal informaƟon or any other informaƟon that a party specifically instructs the broker in wriƟng not to
disclose, unless required to do so by law.

AS SUBAGENT: A license holder acts as a subagent when aiding a buyer in a transacƟon without an agreement to represent the
buyer. A subagent can assist the buyer but does not represent the buyer and must place the interests of the owner first.

TO AVOID DISPUTES, ALL AGREEMENTS BETWEEN YOU AND A BROKER SHOULD BE IN WRITING AND CLEARLY ESTABLISH:
• The broker’s duƟes and responsibiliƟes to you, and your obligaƟons under the representaƟon agreement.
• Who will pay the broker for services provided to you, when payment will be made and how the payment will be calculated.

LICENSE HOLDER CONTACT INFORMATION: This noƟce is being provided for informaƟon purposes. It does not create an obligaƟon for
you to use the broker’s services. Please acknowledge receipt of this noƟce below and retain a copy for your records.

Licensed Broker /Broker Firm Name or License No. Email Phone

Primary Assumed Business Name

Designated Broker of Firm License No. Email Phone

Licensed Supervisor of Sales Agent/ License No. Email Phone

Associate

Sales Agent/Associate’s Name License No. Email Phone

Buyer/Tenant/Seller/Landlord Initials Date

Regulated by the Texas Real Estate Commission InformaƟon available at www.trec.texas.gov

IABS 1-0
 Texas Workforce Commission Civil Rights Division (TWCCRD)
Housing Discrimination Intake Form

Instructions: Please read this form carefully and answer all questions. Failure to answer all questions will delay
the processing of your inquiry. This form must be signed and dated. Failure to sign and date the form will also
delay the processing of your inquiry.

If you have filed a complaint with HUD (US Department of Housing and Urban Development), please contact
HUD for further processing of your complaint. If the property is located within the cities of Austin, Fort Worth,
Corpus Christi, Dallas, or Garland we will not be able to take a complaint and will need to contact the local Fair
Housing office. All dates of harm must be within one year of the date of filing.

Have you filed this complaint with HUD or a local agency within the cities of Austin, Fort Worth, Corpus
Christi, Dallas, or Garland? Yes No

Please mail the completed form How did you hear about us? Date Received (for interoffice use
to : Internet only):
Texas Workforce Commission Housing Provider
Civil Rights Division Walk-in
Attn: Intake Investigator TV/Radio
101 15th Street, Rm. 144-T Other:
Austin, Texas 78701
You may send this questioner via
e-mail to:
housingcomplaint@twc.state.tx.us

TWCCRD offers a mediation program, an alternative approach to litigation and/or investigation for
resolving a dispute. Mediation is fast, free, and effective. A trained mediator will meet with the parties to
assist them in resolving the complaint. If you would like to participate in our free mediation program,
please check this box .

Complainant Information:
Name:
Address:
County:
Phone:
Email:

Names of others aggrieved: (Spouse, Children, Roommates, etc.)

Name:
Relationship:
Name:
Relationship:
Name:
Relationship:

1
Who can we contact if we cannot reach you?
Name:
Phone/E-mail:

Who allegedly discriminated against you? (Person(s) or Organization(s), Yes, No, or Both; Owner,
Landlord, Bank, Realtor, Property Management Company, Apartment complex, etc.)
Name:
Title:
Organization:
Physical
Address:
Mailing
Address:
County:
Email:
Name:
Title:
Organization:
Physical
Address:
Mailing
Address:
County:
Email:

Is this a Tax Credit Property? Yes No

When did the alleged discrimination occur? (List all dates)

Date(s):

Is the discrimination continuous or on-going? Yes No

Where did the alleged discrimination occur?

Address:
County:

It is a violation of the law to deny you your housing rights for any of the following factors:
Race
Color
Religion
Sex
National origin
Familial status (including pregnancy)
Disability
2
Race means:

American Indian or Alaskan Native: A person having origins in any of the original people of North and
South America, including Central America, and who maintains tribal affiliation or community attachment.

Asian: A person having origins in any of the original peoples of the Far East, Southeast Asia or the Indian
subcontinent including Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippines, Thailand,
Vietnam.

Black or African/American: A person having origins in any of the black racial groups of Africa.

Native Hawaiian or Other Pacific Islander: A person having origins in any of the original peoples of
Hawaii, Guam, Samoa or other Pacific Islands.

White: A person having origins in any of the original peoples of Europe, the Middle East or North Africa.

Multi-Racial

It is also a violation of the law to retaliate against someone who previously filed a complaint of fair housing
discrimination, participated in an investigation of fair housing discrimination, or assisted another in filing a
complaint of fair housing discrimination.

State briefly why you believe race, color, religion, sex, national origin, familial status, disability, or
retaliation is the reason you’re being discriminated against:

Do you know of others who were treated more favorably than you? If yes, please list them their
protected status (race, color, religion, sex, national origin, familial status, or disability).

3
Do you have any witnesses that have firsthand knowledge of the alleged harm?
Name:
Address:
Phone: Email:
Name:
Address:
Phone: Email:
Name:
Address:
Phone: Email:

Signature:
Date:

An individual may receive and review information that TWC collects regarding that individual by sending an
e-mail to open.records@twc.state.tx.us or writing to TWC Open Records Section, 101 East 15th Street, Room
266, Austin, Texas 78778-0001.

4
 Code of Ethics and Standards of Practice
of the National Association of Realtors®
Effective January 1, 2016
Where the word Realtors® is used in this Code and Preamble, it shall be Accepting this standard as their own, Realtors® pledge to observe its spirit
deemed to include Realtor-Associate®s. in all of their activities whether conducted personally, through associates
or others, or via technological means, and to conduct their business in
While the Code of Ethics establishes obligations that may be higher than
accordance with the tenets set forth below. (Amended 1/07)
those mandated by law, in any instance where the Code of Ethics and the
law conflict, the obligations of the law must take precedence.
Duties to Clients and Customers
Preamble
Under all is the land. Upon its wise utilization and widely allocated ownership
Article 1
When representing a buyer, seller, landlord, tenant, or other client as an
depend the survival and growth of free institutions and of our civilization.
agent, Realtors® pledge themselves to protect and promote the interests
Realtors® should recognize that the interests of the nation and its citizens
of their client. This obligation to the client is primary, but it does not relieve
require the highest and best use of the land and the widest distribution of
Realtors® of their obligation to treat all parties honestly. When serving
land ownership. They require the creation of adequate housing, the building
a buyer, seller, landlord, tenant or other party in a ­non-agency capacity,
of functioning cities, the development of productive industries and farms,
Realtors® remain obligated to treat all parties honestly. (Amended 1/01)
and the preservation of a healthful environment.
• Standard of Practice 1-1
Such interests impose obligations beyond those of ordinary commerce.
R
 ealtors®, when acting as principals in a real estate transaction, remain
They impose grave social responsibility and a patriotic duty to which
obligated by the duties imposed by the Code of Ethics. (Amended 1/93)
Realtors® should dedicate themselves, and for which they should be
diligent in preparing themselves. Realtors®, therefore, are zealous to • Standard of Practice 1-2
maintain and improve the standards of their calling and share with their T he duties imposed by the Code of Ethics encompass all real
fellow Realtors® a common responsibility for its integrity and honor. estate-related activities and transactions whether conducted in person,
electronically, or through any other means.
In recognition and appreciation of their obligations to clients, customers,
the public, and each other, Realtors® continuously strive to become and
 he duties the Code of Ethics imposes are applicable whether Realtors®
T
remain informed on issues affecting real estate and, as knowledgeable
are acting as agents or in legally recognized non-agency capacities
professionals, they willingly share the fruit of their experience and study with
except that any duty imposed exclusively on agents by law or regulation
others. They identify and take steps, through enforcement of this Code of
shall not be imposed by this Code of Ethics on Realtors® acting in
Ethics and by assisting appropriate regulatory bodies, to eliminate practices
non-agency capacities.
which may damage the public or which might discredit or bring dishonor to
the real estate profession. Realtors® having direct personal knowledge of  s used in this Code of Ethics, “client” means the person(s) or entity(ies)
A
conduct that may violate the Code of Ethics involving misappropriation of with whom a Realtor® or a Realtor®’s firm has an agency or legally
client or customer funds or property, willful discrimination, or fraud resulting recognized non-agency relationship; “customer” means a party to a real
in substantial economic harm, bring such matters to the attention of the estate transaction who receives information, services, or benefits but has
appropriate Board or Association of Realtors®. (Amended 1/00) no contractual relationship with the Realtor® or the Realtor®’s firm;
“prospect” means a purchaser, seller, tenant, or landlord who is not
Realizing that cooperation with other real estate professionals promotes the
subject to a representation relationship with the Realtor® or Realtor®’s
best interests of those who utilize their services, Realtors® urge exclusive
firm; “agent” means a real estate licensee (including brokers and sales
representation of clients; do not attempt to gain any unfair advantage over
associates) acting in an agency relationship as defined by state law or
their competitors; and they refrain from making unsolicited comments about
regulation; and “broker” means a real estate licensee (including brokers
other practitioners. In instances where their opinion is sought, or where
and sales associates) acting as an agent or in a legally recognized
Realtors® believe that comment is necessary, their opinion is offered in an
non-agency capacity. (Adopted 1/95, Amended 1/07)
objective, professional manner, uninfluenced by any personal motivation or
potential advantage or gain. • S
 tandard of Practice 1-3
R
 ealtors®, in attempting to secure a listing, shall not deliberately mislead
The term Realtor has come to connote competency, fairness, and high
®

the owner as to market value.

integrity resulting from adherence to a lofty ideal of moral conduct in
business relations. No inducement of profit and no instruction from clients • Standard of Practice 1-4
ever can justify departure from this ideal. R
 ealtors®, when seeking to become a buyer/tenant representative, shall
not mislead buyers or tenants as to savings or other benefits that might
In the interpretation of this obligation, Realtors® can take no safer guide
be realized through use of the Realtor®’s services. (Amended 1/93)
than that which has been handed down through the centuries, embodied
in the Golden Rule, “Whatsoever ye would that others should do to you, • Standard of Practice 1-5
do ye even so to them.” Realtors® may represent the seller/landlord and buyer/tenant in the

NAR_COESOP_2016.indd 1 11/25/15 9:19 AM

 same transaction only after full disclosure to and with informed consent 2) the fact that buyer/tenant agents or brokers, even if compensated by
of both parties. (Adopted 1/93) listing brokers, or by sellers/landlords may represent the interests of
buyers/tenants; and
• Standard of Practice 1-6
3) any potential for listing brokers to act as disclosed dual agents, e.g.,
Realtors® shall submit offers and counter-offers objectively and as quickly
buyer/tenant agents. (Adopted 1/93, R ­ enum­bered 1/98, Amended 1/03)
as possible. (Adopted 1/93, Amended 1/95)
• Standard of Practice 1-13
• S tandard of Practice 1-7 When entering into buyer/tenant agreements, Realtors® must advise
When acting as listing brokers, Realtors® shall continue to submit to the potential clients of:
seller/landlord all offers and counter-offers until closing or execution of 1) the Realtor®’s company policies regarding cooperation;
a lease unless the seller/landlord has waived this obligation in writing. 2) the amount of compensation to be paid by the client;
Realtors® shall not be obligated to continue to market the property 3) the potential for additional or offsetting compensation from other
after an offer has been accepted by the seller/landlord. Realtors® shall brokers, from the seller or landlord, or from other parties;
recommend that sellers/landlords obtain the advice of legal counsel 4) any potential for the buyer/tenant representative to act as a disclosed
prior to acceptance of a subsequent offer except where the acceptance dual agent, e.g., listing broker, subagent, landlord’s agent, etc., and
is contingent on the termination of the pre-existing purchase contract or 5) the possibility that sellers or sellers’ representatives may not
lease. (Amended 1/93) treat the existence, terms, or conditions of offers as confidential
• Standard of Practice 1-8 unless confidentiality is required by law, regulation, or by any
R
 ealtors®, acting as agents or brokers of buyers/tenants, shall submit to confidentiality agreement between the parties. (Adopted 1/93,
buyers/tenants all offers and counter-offers until acceptance but have no Renumbered 1/98, Amended 1/06)
obligation to continue to show properties to their clients after an offer has • Standard of Practice 1-14
been accepted unless otherwise agreed in writing. Realtors®, acting as Fees for preparing appraisals or other valuations shall not be contingent
agents or brokers of buyers/tenants, shall recommend that buyers/tenants upon the amount of the appraisal or valuation. (Adopted 1/02)
obtain the advice of legal counsel if there is a question as to whether a
• S tandard of Practice 1-15
pre-existing contract has been terminated. (Adopted 1/93, Amended 1/99)
Realtors®, in response to inquiries from buyers or cooperating brokers
• S tandard of Practice 1-9 shall, with the sellers’ approval, disclose the existence of offers on the
The obligation of Realtors® to preserve confidential information (as property. Where disclosure is authorized, Realtors® shall also disclose,
defined by state law) provided by their clients in the course of any agency if asked, whether offers were obtained by the listing licensee, another
relationship or non-agency relation­ship recognized by law continues after licensee in the listing firm, or by a cooperating broker. (Adopted 1/03,
termination of agency relationships or any non-agency relationships Amended 1/09)
recognized by law. Realtors® shall not knowingly, during or following the • S
 tandard of Practice 1-16
termination of professional relationships with their clients: R
 ealtors® shall not access or use, or permit or enable others to access or
1) reveal confidential information of clients; or use,­listed or managed property on terms or conditions other than those
2) use confidential information of clients to the disadvantage of clients; or authorized by the owner or seller. (Adopted 1/12)
3) use confidential information of clients for the Realtor®’s advantage
or the advantage of third parties unless: Article 2
a) clients consent after full disclosure; or
Realtors® shall avoid exaggeration, misrepresentation, or concealment
b) Realtors® are required by court order; or
of pertinent facts relating to the property or the transaction. Realtors®
c) it is the intention of a client to commit a crime and the information
shall not, however, be obligated to discover latent defects in the property,
is necessary to prevent the crime; or
to advise on matters outside the scope of their real estate license, or
d) it is necessary to defend a Realtor® or the Realtor®’s employees or to disclose facts which are confidential under the scope of agency or
associates against an accusation of wrongful conduct. ­non-agency relationships as defined by state law. (Amended 1/00)
Information concerning latent material defects is not considered confidential
information under this Code of Ethics. (Adopted 1/93, Amended 1/01) • Standard of Practice 2-1
Realtors® shall only be obligated to discover and disclose adverse factors
• S
 tandard of Practice 1-10 reasonably apparent to someone with expertise in those areas required
R
 ealtors® shall, consistent with the terms and conditions of their real by their real estate licensing authority. Article 2 does not impose upon
estate licensure and their property management agreement, competently the Realtor® the obligation of expertise in other professional or technical
manage the property of clients with due regard for the rights, safety and disciplines. (Amended 1/96)
health of tenants and others lawfully on the premises. (Adopted 1/95,
Amended 1/00) • Standard of Practice 2-2
( Renumbered as Standard of Practice 1-12 1/98)
• S tandard of Practice 1-11
Realtors® who are employed to maintain or manage a client’s property • Standard of Practice 2-3
shall exercise due diligence and make reasonable efforts to protect it ( Renumbered as Standard of Practice 1-13 1/98)
against reasonably foreseeable contingencies and losses. (Adopted 1/95) • S
 tandard of Practice 2-4
• Standard of Practice 1-12 R
 ealtors® shall not be parties to the naming of a false consideration
When entering into listing contracts, Realtors® must advise sellers/ in any document, unless it be the naming of an obviously nominal
landlords of: consideration.
1) the Realtor®’s company policies regarding cooperation and the • S
 tandard of Practice 2-5
amount(s) of any compensation that will be offered to subagents, F
 actors defined as “non-material” by law or regulation or which are
buyer/tenant agents, and/or brokers acting in legally recognized expressly referenced in law or regulation as not being subject to disclosure
non-agency capacities; are considered not “pertinent” for purposes of Article 2. (Adopted 1/93)

NAR_COESOP_2016.indd 2 11/25/15 9:19 AM

 Article 3 other than those established by the owner or the listing broker.
Realtors shall cooperate with other brokers except when cooperation is
® (Adopted 1/10)
not in the client’s best interest. The obligation to cooperate does not include • Standard of Practice 3-10
the obligation to share commissions, fees, or to otherwise compensate T
 he duty to cooperate established in Article 3 relates to the obligation to
another broker. (Amended 1/95) share information on listed property, and to make property available to
• Standard of Practice 3-1 other brokers for showing to prospective purchasers/tenants when it is
R
 ealtors®, acting as exclusive agents or brokers of sellers/ landlords, in the best interests of sellers/landlords. (Adopted 1/11)
establish the terms and conditions of offers to cooperate. Unless
expressly indicated in offers to cooperate, cooperating brokers may not Article 4
assume that the offer of cooperation includes an offer of compensation. Realtors® shall not acquire an interest in or buy or present offers from
Terms of compensation, if any, shall be ascertained by cooperating themselves, any member of their immediate families, their firms or any
brokers before beginning efforts to accept the offer of cooperation. member thereof, or any entities in which they have any ownership interest,
(Amended 1/99) any real property without making their true position known to the owner or
the owner’s agent or broker. In selling property they own, or in which they
• S tandard of Practice 3-2 have any interest, Realtors® shall reveal their ownership or interest in
Any change in compensation offered for cooperative services must be writing to the purchaser or the purchaser’s representative. (Amended 1/00)
communicated to the other Realtor® prior to the time that Realtor®
submits an offer to purchase/lease the property. After a Realtor® has • Standard of Practice 4-1
submitted an offer to purchase or lease property, the listing broker may For the protection of all parties, the disclosures required by Article 4
not attempt to unilaterally modify the offered compensation with respect shall be in writing and provided by Realtors® prior to the signing of any
to that cooperative transaction. (Amended 1/14) contract. (Adopted 2/86)

• Standard of Practice 3-3

Article 5
Standard of Practice 3-2 does not preclude the listing broker and
Realtors® shall not undertake to provide professional services concerning
cooperating broker from entering into an agreement to change
a property or its value where they have a present or contemplated interest
cooperative compensation. (Adopted 1/94)
unless such interest is specifically disclosed to all affected parties.
• Standard of Practice 3-4
R
 ealtors®, acting as listing brokers, have an affirmative obligation to Article 6
disclose the existence of dual or variable rate commission arrangements R ealtors ® shall not accept any commission, rebate, or profit
(i.e., listings where one amount of commission is payable if the listing on expenditures made for their client, without the client’s knowledge and
broker’s firm is the procuring cause of sale/lease and a different amount consent.
of commission is payable if the sale/lease results through the efforts of When recommending real estate products or services (e.g., homeowner’s
the seller/landlord or a cooperating broker). The listing broker shall, as insurance, warranty programs, mortgage financing, title insurance,
soon as practical, disclose the existence of such arrangements to potential etc.), Realtors® shall disclose to the client or customer to whom the
cooperating brokers and shall, in response to inquiries from cooperating recommendation is made any financial benefits or fees, other than real
brokers, disclose the differential that would result in a cooperative estate referral fees, the Realtor® or Realtor®’s firm may receive as a
transaction or in a sale/lease that results through the efforts of the seller/ direct result of such recommendation. (Amended 1/99)
landlord. If the cooperating broker is a buyer/tenant representative, the
buyer/tenant representative must disclose such information to their client • Standard of Practice 6-1
before the client makes an offer to purchase or lease. (Amended 1/02) Realtors® shall not recommend or suggest to a client or a customer the
use of services of another organization or business entity in which they
• Standard of Practice 3-5 have a direct interest without disclosing such interest at the time of the
It is the obligation of subagents to promptly disclose all pertinent facts recommendation or suggestion. (Amended 5/88)
to the principal’s agent prior to as well as after a purchase or lease
agreement is executed. (Amended 1/93) Article 7
In a transaction, Realtors® shall not accept compensation from more than
• Standard of Practice 3-6
one party, even if permitted by law, without disclosure to all parties and the
Realtors® shall disclose the existence of accepted offers, including
informed consent of the Realtor®’s client or clients. (Amended 1/93)
offers with unresolved contingencies, to any broker seeking cooperation.
(Adopted 5/86, Amended 1/04) Article 8
• S tandard of Practice 3-7 Realtors® shall keep in a special account in an appropriate financial
When seeking information from another Realtor® concerning property institution, separated from their own funds, monies coming into their
under a management or listing agreement, Realtors® shall disclose possession in trust for other persons, such as escrows, trust funds, clients’
their Realtor® status and whether their interest is personal or on behalf monies, and other like items.
of a client and, if on behalf of a client, their relationship with the client.
(Amended 1/11)
Article 9
Realtors®, for the protection of all parties, shall assure whenever possible
• Standard of Practice 3-8 that all agreements related to real estate transactions including, but not
R
 ealtors® shall not misrepresent the availability of access to show or limited to, listing and representation agreements, purchase contracts, and
inspect a listed property. (Amended 11/87) leases are in writing in clear and understandable language expressing the
specific terms, conditions, obligations and commitments of the parties. A
• Standard of Practice 3-9
copy of each agreement shall be furnished to each party to such agreements
R
 ealtors ® shall not provide access to listed property on terms
upon their signing or initialing. (Amended 1/04)

NAR_COESOP_2016.indd 3 11/25/15 9:19 AM

 • Standard of Practice 9-1 reasonably expected in the specific real estate disciplines in which
For the protection of all parties, Realtors® shall use reasonable care they engage; specifically, residential real estate brokerage, real property
to ensure that documents pertaining to the purchase, sale, or lease of management, commercial and industrial real estate brokerage, land
real estate are kept current through the use of written extensions or brokerage, real estate appraisal, real estate counseling, real estate
amendments. (Amended 1/93) syndication, real estate auction, and international real estate.

• Standard of Practice 9-2 Realtors® shall not undertake to provide specialized professional services
When assisting or enabling a client or customer in establishing a concerning a type of property or service that is outside their field of
contractual relationship (e.g., listing and representation agreements, competence unless they engage the assistance of one who is competent
purchase agreements, leases, etc.) electronically, Realtors® shall make on such types of property or service, or unless the facts are fully disclosed
reasonable efforts to explain the nature and disclose the specific terms to the client. Any persons engaged to provide such assistance shall be so
of the contractual relationship being established prior to it being agreed identified to the client and their contribution to the assignment should be
to by a contracting party. (Adopted 1/07) set forth. (Amended 1/10)

• Standard of Practice 11-1

Duties to the Public When Realtors® prepare opinions of real property value or price they must:
1
 ) be knowledgeable about the type of property being valued,
Article 10 2
 ) have access to the information and resources necessary to formulate
Realtors® shall not deny equal professional services to any person for
an accurate opinion, and
reasons of race, color, religion, sex, handicap, familial status, national
3
 ) be familiar with the area where the subject property is located
origin, sexual orientation, or gender identity. Realtors® shall not be parties
to any plan or agreement to discriminate against a person or persons on unless lack of any of these is disclosed to the party requesting the opinion
the basis of race, color, religion, sex, handicap, familial status, national in advance.
origin, sexual orientation, or gender identity. (Amended 1/14)
When an opinion of value or price is prepared other than in pursuit of a
R ealtors ®, in their real estate employment practices, shall not listing or to assist a potential purchaser in formulating a purchase offer, the
discriminate against any person or persons on the basis of race, opinion shall include the following unless the party requesting the opinion
color, religion, sex, handicap, familial status, national origin, sexual requires a specific type of report or different data set:
orientation, or gender identity. (Amended 1/14) 1
 ) identification of the subject property
2
 ) date prepared
• S tandard of Practice 10-1
3
 ) defined value or price
W hen involved in the sale or lease of a residence, R ealtors ®
4
 ) limiting conditions, including statements of purpose(s) and intended
shall not volunteer information regarding the racial, religious
user(s)
or ethnic composition of any neighborhood nor shall they engage in
5) any present or contemplated interest, including the possibility of
any activity which may result in panic selling, however, Realtors® may
representing the seller/landlord or buyers/tenants
provide other demographic information. (Adopted 1/94, Amended 1/06)
6
 ) basis for the opinion, including applicable market data
• Standard of Practice 10-2 7
 ) if the opinion is not an appraisal, a statement to that effect
When not involved in the sale or lease of a residence, Realtors® may 8) disclosure of whether and when a physical inspection of the property’s
provide demographic information related to a property, ­transaction or exterior was conducted
professional assignment to a party if such ­demographic ­information 9) disclosure of whether and when a physical inspection of the property’s
is (a) deemed by the R ealtor ® to be n ­ eeded to assist with or interior was conducted
complete, in a manner ­c onsistent with Article 10, a real estate 10) disclosure of whether the Realtor® has any conflicts of interest
transaction or ­professional assignment and (b) is obtained or derived (Amended 1/14)
from a recognized, reliable, ­independent, and impartial source. The
• S tandard of Practice 11-2
source of such ­information and any ­additions, deletions, ­modifications,
The obligations of the Code of Ethics in respect of real estate disciplines
­interpretations, or other changes shall be ­disclosed in reasonable detail.
other than appraisal shall be interpreted and applied in accordance with
(Adopted 1/05, Renumbered 1/06)
the standards of competence and practice which clients and the public
• Standard of Practice 10-3 reasonably require to protect their rights and interests considering the
Realtors® shall not print, display or circulate any statement or adver- complexity of the transaction, the availability of expert assistance, and,
tisement with respect to selling or renting of a ­property that indicates where the Realtor® is an agent or subagent, the obligations of a fiduciary.
any preference, limitations or ­discrimination based on race, color, (Adopted 1/95)
religion, sex, handicap, familial status, national origin, sexual orienta-
• S tandard of Practice 11-3
tion, or gender identity. (Adopted 1/94, Renumbered 1/05 and 1/06,
When Realtors® provide consultive services to clients which involve
Amended 1/14)
advice or counsel for a fee (not a commission), such advice shall be
• Standard of Practice 10-4 rendered in an objective manner and the fee shall not be contingent on
As used in Article 10 “real estate employment practices” relates to the substance of the advice or counsel given. If brokerage or transaction
employees and independent contractors providing real estate-related services are to be provided in addition to consultive services, a separate
services and the administrative and clerical staff directly supporting those compensation may be paid with prior agreement between the client and
individuals. (Adopted 1/00, Renumbered 1/05 and 1/06) Realtor®. (Adopted 1/96)

• S tandard of Practice 11-4

Article 11 The competency required by Article 11 relates to services contracted for
The services which Realtors® provide to their clients and customers between Realtors® and their clients or customers; the duties expressly
shall conform to the standards of practice and competence which are

NAR_COESOP_2016.indd 4 11/25/15 9:19 AM

 imposed by the Code of Ethics; and the duties imposed by law or • Standard of Practice 12-8
regulation. (Adopted 1/02) The obligation to present a true picture in representations to the public
includes information presented, provided, or displayed on Realtors®’
Article 12 websites. Realtors® shall use reasonable efforts to ensure that
Realtors® shall be honest and truthful in their real estate communications information on their websites is current. When it becomes apparent that
and shall present a true picture in their advertising, marketing, and other information on a Realtor®’s website is no longer current or accurate,
representations. Realtors® shall ensure that their status as real estate Realtors® shall promptly take corrective action. (Adopted 1/07)
professionals is readily apparent in their advertising, marketing, and other
• Standard of Practice 12-9
representations, and that the recipients of all real estate communications
R
 ealtor® firm websites shall disclose the firm’s name and state(s) of
are, or have been, notified that those communications are from a real estate
licensure in a reasonable and readily apparent manner.
professional. (Amended 1/08)
Websites of Realtors® and non-member licensees affiliated with a
• S tandard of Practice 12-1
Realtor® firm shall disclose the firm’s name and that Realtor®’s or
Realtors® may use the term “free” and similar terms in their advertising
non-member licensee’s state(s) of licensure in a reasonable and readily
and in other representations provided that all terms governing availability
apparent manner. (Adopted 1/07)
of the offered product or service are clearly disclosed at the same time.
(Amended 1/97) • Standard of Practice 12-10
R
 ealtors®’ obligation to present a true picture in their advertising and
• Standard of Practice 12-2
representations to the public includes Internet content posted, and the URLs
R
 ealtors® may represent their services as “free” or without cost even if
and domain names they use, and prohibits Realtors® from:
they expect to receive compensation from a source other than their client
1) engaging in deceptive or unauthorized framing of real estate brokerage
provided that the potential for the Realtor® to obtain a benefit from a third
websites;
party is clearly disclosed at the same time. (Amended 1/97)
2) manipulating (e.g., presenting content developed by others) listing
• Standard of Practice 12-3 and other content in any way that produces a deceptive or misleading
The offering of premiums, prizes, merchandise discounts or other result;
inducements to list, sell, purchase, or lease is not, in itself, unethical 3) deceptively using metatags, keywords or other devices/methods to
even if receipt of the benefit is contingent on listing, selling, purchasing, direct, drive, or divert Internet traffic; or
or leasing through the Realtor® making the offer. However, Realtors® 4) presenting content developed by others without either attribution or
must exercise care and candor in any such advertising or other public without permission, or
or private representations so that any party interested in receiving or 5) to otherwise mislead consumers. (Adopted 1/07, Amended 1/13)
otherwise benefiting from the Realtor®’s offer will have clear, thorough,
• Standard of Practice 12-11
advance understanding of all the terms and conditions of the offer. The
Realtors® intending to share or sell consumer information gathered via
offering of any inducements to do business is subject to the limitations
the Internet shall disclose that possibility in a reasonable and readily
and restrictions of state law and the ethical obligations established by
apparent manner. (Adopted 1/07)
any applicable Standard of Practice. (Amended 1/95)
• Standard of Practice 12-12
• Standard of Practice 12-4
 ealtors® shall not:
R
R
 ealtors® shall not offer for sale/lease or advertise property without
1
 ) use URLs or domain names that present less than a true picture, or
authority. When acting as listing brokers or as subagents, Realtors®
2) register URLs or domain names which, if used, would present less
shall not quote a price different from that agreed upon with the seller/
than a true picture. (Adopted 1/08)
landlord. (Amended 1/93)
• Standard of Practice 12-13
• S
 tandard of Practice 12-5
The obligation to present a true picture in advertising, marketing, and
R
 ealtors® shall not advertise nor permit any person employed by or
representations allows Realtors® to use and display only professional
affiliated with them to advertise real estate services or listed property
designations, certifications, and other credentials to which they are
in any medium (e.g., electronically, print, radio, television, etc.) without
legitimately entitled. (Adopted 1/08)
disclosing the name of that Realtor®’s firm in a reasonable and readily
apparent manner either in the advertisement or in electronic advertising Article 13
via a link to a display with all required disclosures. (Adopted 11/86, Realtors® shall not engage in activities that constitute the unauthorized
Amended 1/16) practice of law and shall recommend that legal counsel be obtained when
• Standard of Practice 12-6 the interest of any party to the transaction requires it.
R
 ealtors®, when advertising unlisted real property for sale/lease in
which they have an ownership interest, shall disclose their status as
Article 14
If charged with unethical practice or asked to present evidence or to
both owners/landlords and as Realtors® or real estate licensees.
cooperate in any other way, in any professional standards proceeding or
(Amended 1/93)
investigation, Realtors® shall place all pertinent facts before the proper
• Standard of Practice 12-7 tribunals of the Member Board or affiliated institute, society, or council in
O
 nly Realtors® who participated in the transaction as the listing broker or which membership is held and shall take no action to disrupt or obstruct
cooperating broker (selling broker) may claim to have “sold” the property. such processes. (Amended 1/99)
Prior to closing, a cooperating broker may post a “sold” sign only with
the consent of the listing broker. (Amended 1/96)

NAR_COESOP_2016.indd 5 11/25/15 9:19 AM

 • S
 tandard of Practice 14-1 compensation or other forms of payment or expenses. (Adopted 1/93,
R
 ealtors ® shall not be subject to disciplinary proceedings in Amended 1/95)
more than one Board of Realtors® or affiliated institute, society,
• Standard of Practice 16-2
or council in which they hold membership with respect to alleged
Article 16 does not preclude Realtors® from making general announcements
violations of the Code of Ethics relating to the same transaction
to prospects describing their services and the terms of their availability even
or event. (Amended 1/95)
though some recipients may have entered into agency agreements or
• S tandard of Practice 14-2 other exclusive relationships with another Realtor®. A general telephone
Realtors® shall not make any unauthorized disclosure or dissemination canvass, general mailing or distribution addressed to all prospects in a given
of the allegations, findings, or decision developed in connection with an geographical area or in a given profession, business, club, or organization,
ethics hearing or appeal or in connection with an arbitration hearing or or other classification or group is deemed “general” for purposes of this
procedural review. (Amended 1/92) standard. (Amended 1/04)

• Standard of Practice 14-3 A

 rticle 16 is intended to recognize as unethical two basic types
R
 ealtors® shall not obstruct the Board’s investigative or professional of solicitations:
standards proceedings by instituting or threatening to institute actions for
 irst, telephone or personal solicitations of property owners who have
F
libel, slander, or defamation against any party to a professional standards
been identified by a real estate sign, multiple listing compilation, or
proceeding or their witnesses based on the filing of an arbitration request,
other information service as having exclusively listed their property
an ethics complaint, or testimony given before any tribunal. (Adopted
with another Realtor® and
11/87, Amended 1/99)
Second, mail or other forms of written solicitations of prospects
• S
 tandard of Practice 14-4
whose properties are exclusively listed with another Realtor® when
R
 ealtors® shall not intentionally impede the Board’s investigative or
such solicitations are not part of a general mailing but are directed
disciplinary proceedings by filing multiple ethics complaints based on
specifically to property owners identified through compilations of
the same event or transaction. (Adopted 11/88)
current listings, “for sale” or “for rent” signs, or other sources of
information required by Article 3 and Multiple Listing Service rules to
Duties to Realtors® be made available to other Realtors® under offers of subagency or
cooperation. (Amended 1/04)
Article 15
Realtors® shall not knowingly or recklessly make false or misleading • Standard of Practice 16-3
statements about other real estate professionals, their businesses, or Article 16 does not preclude Realtors® from contacting the client of
their business practices. (Amended 1/12) another broker for the purpose of offering to provide, or entering into a
contract to provide, a different type of real estate service unrelated to
• S
 tandard of Practice 15-1
the type of service currently being provided (e.g., property management
R
 ealtors® shall not knowingly or recklessly file false or unfounded
as opposed to brokerage) or from offering the same type of service for
ethics complaints. (Adopted 1/00)
property not subject to other brokers’ exclusive agreements. However,
• S tandard of Practice 15-2 information received through a Multiple Listing Service or any other offer
The obligation to refrain from making false or misleading statements of cooperation may not be used to target clients of other Realtors® to
about other real estate professionals, their businesses, and their whom such offers to provide services may be made. (Amended 1/04)
business practices includes the duty to not knowingly or recklessly
• Standard of Practice 16-4
publish, repeat, retransmit, or republish false or misleading statements
R
 ealtors® shall not solicit a listing which is currently listed exclusively
made by others. This duty applies whether false or misleading
with another broker. However, if the listing broker, when asked by
statements are repeated in person, in writing, by technological means
the Realtor®, refuses to disclose the expiration date and nature
(e.g., the Internet), or by any other means. (Adopted 1/07, Amended
of such listing, i.e., an exclusive right to sell, an exclusive agency,
1/12)
open listing, or other form of contractual agreement between the
• S tandard of Practice 15-3 listing broker and the client, the Realtor® may contact the owner to
The obligation to refrain from making false or misleading statements secure such information and may discuss the terms upon which the
about other real estate professionals, their businesses, and their Realtor® might take a future listing or, alternatively, may take a listing
business practices includes the duty to publish a clarification about or to become effective upon expiration of any existing exclusive listing.
to remove statements made by others on electronic media the Realtor® (Amended 1/94)
controls once the Realtor® knows the statement is false or misleading.
• Standard of Practice 16-5
(Adopted 1/10, Amended 1/12)
R
 ealtors® shall not solicit buyer/tenant agreements from buyers/
tenants who are subject to exclusive buyer/tenant agreements.
Article 16 However, if asked by a Realtor®, the broker refuses to disclose the
Realtors® shall not engage in any practice or take any action inconsistent
expiration date of the exclusive buyer/tenant agreement, the Realtor®
with exclusive representation or exclusive brokerage relationship agreements
may contact the buyer/tenant to secure such information and may
that other Realtors® have with clients. (Amended 1/04)
discuss the terms upon which the Realtor® might enter into a future
• Standard of Practice 16-1 buyer/tenant agreement or, alternatively, may enter into a buyer/tenant
A rticle 16 is not intended to prohibit aggressive or innovative agreement to become effective upon the expiration of any existing
business practices which are otherwise ethical and does not prohibit exclusive buyer/tenant agreement. (Adopted 1/94, Amended 1/98)
disagreements with other Realtors® involving commission, fees,

NAR_COESOP_2016.indd 6 11/25/15 9:19 AM

 • Standard of Practice 16-6 • Standard of Practice 16-14
When Realtors® are contacted by the client of another Realtor® regarding Realtors® are free to enter into contractual relationships or to negotiate
the creation of an exclusive relationship to provide the same type of service, with sellers/landlords, buyers/tenants or others who are not subject to an
and Realtors® have not directly or indirectly initiated such discussions, they exclusive agreement but shall not knowingly obligate them to pay more
may discuss the terms upon which they might enter into a future agreement than one commission except with their informed consent. (Amended 1/98)
or, alternatively, may enter into an agreement which becomes effective upon
• Standard of Practice 16-15
expiration of any existing exclusive agreement. (Amended 1/98)
In cooperative transactions Realtors® shall compensate cooperating
• Standard of Practice 16-7 Realtors® (principal brokers) and shall not compensate nor offer
The fact that a prospect has retained a Realtor® as an exclusive to compensate, directly or indirectly, any of the sales licensees employed
representative or exclusive broker in one or more past transactions by or affiliated with other Realtors® without the prior express knowledge
does not preclude other Realtors® from seeking such prospect’s future and consent of the cooperating broker.
business. (Amended 1/04)
• Standard of Practice 16-16
• Standard of Practice 16-8 R
 ealtors®, acting as subagents or buyer/tenant representatives or brokers,
The fact that an exclusive agreement has been entered into with a shall not use the terms of an offer to purchase/lease to attempt to modify
Realtor® shall not preclude or inhibit any other Realtor® from entering the listing broker’s offer of compensation to subagents or buyer/tenant
into a similar agreement after the expiration of the prior agreement. representatives or brokers nor make the submission of an executed offer
(Amended 1/98) to purchase/lease contingent on the listing broker’s agreement to modify
the offer of compensation. (Amended 1/04)
• Standard of Practice 16-9
R
 ealtors®, prior to entering into a representation agreement, have an • Standard of Practice 16-17
affirmative obligation to make reasonable efforts to determine whether Realtors®, acting as subagents or as buyer/tenant representatives or
the prospect is subject to a current, valid exclusive agreement to provide brokers, shall not attempt to extend a listing broker’s offer of cooperation
the same type of real estate service. (Amended 1/04) and/or compensation to other brokers without the consent of the listing
broker. (Amended 1/04)
• Standard of Practice 16-10
Realtors®, acting as buyer or tenant representatives or brokers, shall • Standard of Practice 16-18
disclose that relationship to the seller/landlord’s representative or broker R
 ealtors® shall not use information obtained from listing brokers through
at first contact and shall provide written confirmation of that disclosure offers to cooperate made through multiple listing services or through other
to the seller/landlord’s representative or broker not later than execution offers of cooperation to refer listing brokers’ clients to other brokers or to
of a purchase agreement or lease. (Amended 1/04) create buyer/tenant relationships with listing brokers’ clients, unless such
use is authorized by listing brokers. (Amended 1/02)
• Standard of Practice 16-11
O
 n unlisted property, Realtors® acting as buyer/tenant representatives • Standard of Practice 16-19
or brokers shall disclose that relationship to the seller/landlord at first Signs giving notice of property for sale, rent, lease, or exchange shall not
contact for that buyer/tenant and shall provide written confirmation of such be placed on property without consent of the seller/landlord. (Amended
disclosure to the seller/landlord not later than execution of any purchase 1/93)
or lease agreement. (Amended 1/04)
• Standard of Practice 16-20
Realtors® shall make any request for anticipated compensation from the R
 ealtors®, prior to or after their relationship with their current firm
seller/landlord at first contact. (Amended 1/98) is terminated, shall not induce clients of their current firm to cancel
exclusive contractual agreements between the client and that firm.
• Standard of Practice 16-12
This does not preclude Realtors® (principals) from establishing
R
 ealtors®, acting as representatives or brokers of sellers/landlords or
agreements with their associated licensees governing assignability
as subagents of listing brokers, shall disclose that relationship to buyers/
of exclusive agreements. (Adopted 1/98, Amended 1/10)
tenants as soon as practicable and shall provide written confirmation
of such disclosure to buyers/tenants not later than execution of any
purchase or lease agreement. (Amended 1/04)
Article 17
In the event of contractual disputes or specific non-contractual disputes
• Standard of Practice 16-13 as defined in Standard of Practice 17-4 between Realtors® (principals)
All dealings concerning property exclusively listed, or with buyer/tenants associated with different firms, arising out of their relationship as Realtors®,
who are subject to an exclusive agreement shall be carried on with the the Realtors® shall mediate the dispute if the Board requires its members to
client’s representative or broker, and not with the client, except with the mediate. If the dispute is not resolved through mediation, or if mediation is
consent of the client’s representative or broker or except where such not required, Realtors® shall submit the dispute to arbitration in accordance
dealings are initiated by the client. with the policies of the Board rather than litigate the matter.

 efore providing substantive services (such as writing a purchase offer

B In the event clients of Realtors® wish to mediate or arbitrate contractual
or presenting a CMA) to prospects, Realtors® shall ask prospects disputes arising out of real estate transactions, Realtors® shall mediate
whether they are a party to any exclusive representation agreement. or arbitrate those disputes in accordance with the policies of the Board,
Realtors® shall not knowingly provide substantive services concerning provided the clients agree to be bound by any resulting agreement or
a prospective transaction to prospects who are parties to exclusive award.
representation agreements, except with the consent of the prospects’
The obligation to participate in mediation and arbitration contemplated by
exclusive representatives or at the direction of prospects. (Adopted 1/93,
this Article includes the obligation of Realtors® (principals) to cause their
Amended 1/04)
firms to mediate and arbitrate and be bound by any resulting agreement
or award. (Amended 1/12)

NAR_COESOP_2016.indd 7 11/25/15 9:19 AM

 • Standard of Practice 17-1 3) Where a buyer or tenant representative is compensated by the buyer
The filing of litigation and refusal to withdraw from it by Realtors® in an or tenant and, as a result, the listing broker reduces the commission
arbitrable matter constitutes a refusal to arbitrate. (Adopted 2/86) owed by the seller or landlord and, subsequent to such actions,
another cooperating broker claims to be the procuring cause of sale or
• Standard of Practice 17-2
lease. In such cases the complainant may name the first cooperating
Article 17 does not require Realtors® to mediate in those circumstances
broker as respondent and arbitration may proceed without the listing
when all parties to the dispute advise the Board in writing that they
broker being named as a respondent. Alternatively, if the complaint
choose not to mediate through the Board’s facilities. The fact that all
is brought against the listing broker, the listing broker may name
parties decline to participate in mediation does not relieve Realtors®
the first cooperating broker as a third-party respondent. In either
of the duty to arbitrate.
instance the decision of the hearing panel as to procuring cause shall
be conclusive with respect to all current or subsequent claims of the
 rticle 17 does not require Realtors® to arbitrate in those circumstances
A
parties for compensation arising out of the underlying cooperative
when all parties to the dispute advise the Board in writing that they choose
transaction. (Adopted 1/97)
not to arbitrate before the Board. (Amended 1/12)
4) Where two or more listing brokers claim entitlement to compensation
• Standard of Practice 17-3
pursuant to open listings with a seller or landlord who agrees to
R
 ealtors®, when acting solely as principals in a real estate transaction, are
participate in arbitration (or who requests arbitration) and who
not obligated to arbitrate disputes with other Realtors® absent a specific
agrees to be bound by the decision. In cases where one of the
written agreement to the contrary. (Adopted 1/96)
listing brokers has been compensated by the seller or landlord, the
• S tandard of Practice 17-4 other listing broker, as complainant, may name the first listing broker
Specific non-contractual disputes that are subject to arbitration pursuant as respondent and arbitration may proceed between the brokers.
to Article 17 are: (Adopted 1/97)

1) Where a listing broker has compensated a cooperating broker 5) Where a buyer or tenant representative is compensated by the seller
and another cooperating broker subsequently claims to be the or landlord, and not by the listing broker, and the listing broker, as a
procuring cause of the sale or lease. In such cases the complainant result, reduces the commission owed by the seller or landlord and,
may name the first cooperating broker as respondent and arbitration subsequent to such actions, claims to be the procuring cause of sale
may proceed without the listing broker being named as a respondent. or lease. In such cases arbitration shall be between the listing broker
When arbitration occurs between two (or more) cooperating brokers and the buyer or tenant representative and the amount in dispute is
and where the listing broker is not a party, the amount in dispute and limited to the amount of the reduction of commission to which the listing
the amount of any potential resulting award is limited to the amount broker agreed. (Adopted 1/05)
paid to the respondent by the listing broker and any amount credited
• Standard of Practice 17-5
or paid to a party to the transaction at the direction of the respondent.
The obligation to arbitrate established in Article 17 includes disputes
Alternatively, if the complaint is brought against the listing broker, the
between Realtors® (principals) in different states in instances where,
listing broker may name the first cooperating broker as a third-party
absent an established inter-association arbitration agreement, the
respondent. In either instance the decision of the hearing panel as
Realtor® (principal) requesting arbitration agrees to submit to the
to procuring cause shall be conclusive with respect to all current or
jurisdiction of, travel to, participate in, and be bound by any resulting
subsequent claims of the parties for compensation arising out of the
award rendered in arbitration conducted by the respondent(s) Realtor®’s
underlying cooperative transaction. (Adopted 1/97, Amended 1/07)
association, in instances where the respondent(s) Realtor®’s association
2) Where a buyer or tenant representative is compensated by the seller determines that an arbitrable issue exists. (Adopted 1/07)
or landlord, and not by the listing broker, and the listing broker, as a
result, reduces the commission owed by the seller or landlord and, Explanatory Notes
subsequent to such actions, another cooperating broker claims to be The reader should be aware of the following policies which have been
the procuring cause of sale or lease. In such cases the complainant approved by the Board of Directors of the National Association:
may name the first cooperating broker as respondent and arbitration In filing a charge of an alleged violation of the Code of Ethics by a Realtor®,
may proceed without the listing broker being named as a respondent. the charge must read as an alleged violation of one or more Articles of
When arbitration occurs between two (or more) cooperating brokers the Code. Standards of Practice may be cited in support of the charge.
and where the listing broker is not a party, the amount in dispute and
The Standards of Practice serve to clarify the ethical obligations imposed
the amount of any potential resulting award is limited to the amount paid
by the various Articles and supplement, and do not substitute for, the Case
to the respondent by the seller or landlord and any amount credited
Interpretations in Interpretations of the Code of Ethics.
or paid to a party to the transaction at the direction of the respondent.
Alternatively, if the complaint is brought against the listing broker, the Modifications to existing Standards of Practice and additional new
listing broker may name the first cooperating broker as a third-party Standards of Practice are approved from time to time. Readers are
respondent. In either instance the decision of the hearing panel as cautioned to ensure that the most recent publications are utilized.
to procuring cause shall be conclusive with respect to all current or
subsequent claims of the parties for compensation arising out of the
underlying cooperative transaction. (Adopted 1/97, Amended 1/07)

© 2016 NATIONAL ASSOCIATION OF REALTORS®­­ 166-288-16 (01/16 JB)

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Lode Claim Layout and Description Example

A lode claim may not exceed 1500 feet X 600 feet in size. You must describe lode claims by metes and bounds
beginning at the discovery point on the claim and include a tie to natural objects or permanent monuments
including:
(1) Township and section survey monuments;
(2) Official U.S. mineral survey monuments;
(3) Monuments of the National Geodetic Reference System;
(4) The confluence of streams or point of intersection of well-known gulches, ravines, or roads, prominent
buttes, and hills; or
(5) Adjoining claims or sites.

Include a map of the claim showing the claim boundaries in relationship to the section boundaries.

Metes and Bounds (Metes and bounds literally means to measure the limits of a boundary.) n. a surveyor's
description of a parcel of property, using carefully measured distances, angles, and directions, which results in
what is called a "legal description" of the land. Metes refers to distance in feet and inches and bounds to direction
in degrees of a compass. A critical feature is the Point of Beginning POB. (It is not neccessary to hire a certified
surveyor to establish a metes and bounds claim description. )

Claim #1 is in the SE¼ Sec. 11, T. 30 N., R. 5 E.

Claim #2 in in the SE¼ and NE¼ of Sec. 11

Metes and Bounds Description

Beginning at point of discovery E (180°) 425'
NW¼ NE¼
to Corner #1, Thence 600' N 60 W (300°) to
Corner #2, Thence 1500' S 38° W (218°) to Line of vein
Corner #3, Thence 600' S 60° E (120°), Sec. 11 * Vein orientation is N 38° E
Thence 1500' N 38° E (38°) to Corner #1, the using a quadrant compass or
SW¼ SE¼ 38° using a 360° complass.
point of beginning.

Line of vein

2
Discovery
*SE¼ 1

3
4
 Rectangular (Government) Survey Method

Figure 3
Figure 1 Figure 2

Township lines Range lines Sections in Townships

6 5 4 3 2 1
7 8 9 10 11 12
18 17 16 15 14 13
19 20 21 22 23 24
30 29 28 27 26 25
31 32 33 34 35 36

Figure 4

Divisions of Sections

NW 1/4
(160 Acres)

E 1/2
(320 Acres)

NE 1/4 of
of SW 1/4
W 1/2 of
(40 acres)
SW 1/4
(80 Acres) 10 Ac
W 1/2 of
SE 1/4 of
SW 1/4
(20 ac) 10 Ac
Parcel 6 = SE1/4 of SE1/4 of SW1/4 (10 acres)
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