Legal FAQs for REALTORS® — Advertising
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If a name of a firm includes terms such as "real estate" or "management," is that sufficient to identify the firm as a real estate brokerage firm? (updated July 24, 2013)

No. Generally, those terms are not sufficient.


Along those same lines, would the following designations in advertisements be sufficient? (updated July 24, 2013)

Yes: For Sale, Branigan Real Estate Brokerage Firm, 555-5555
Yes: For Sale, John Elder and Company, REALTORS®, 772-2828
Yes: For Sale, Cahill Realty, 523-2323

No: For Sale, Rio Bravo Real Estate, 444-4343
No: For Sale, Rio Lobo Management, 222-2727
No: For Sale, Guns Donavon and Company, 667-6677


If the ad identifies the firm as a real estate brokerage firm and names individual associates in the advertisement as well, must I designate each associate as a salesperson or broker? (updated Jan. 1, 2002)

It is prudent to identify each and every person named in the advertisement as a salesperson or broker to avoid confusion, but is not required as long as the person or firm causing the ad to be published is identified in the ad as a real estate broker or salesperson.


May I have a global disclosure at the top or bottom of each page that says all persons and firms named in this advertisement are licensed brokers or salespersons? (updated Jan. 1, 2002)

Yes, assuming all individuals named in the advertisement are licensed. Be careful not to include the names of any unlicensed persons in such an advertisement.


May I use abbreviations to identify a person as a licensee? (updated Jan. 1, 2002)

Yes, if the general public commonly knows the meaning of the abbreviation. For example, brkr. or agt. are probably sufficient.


Do the same rules that require the license-identification information to be included in an advertisement and require the name of the broker or firm to be an advertisement apply to classified ads as well? (updated Jan. 1, 2002)

Yes.


How do I identify myself as a real estate broker or salesperson in my advertisements? (updated June 25, 2014)

The Real Estate License Act requires licensees to identify themselves as a real estate broker or salesperson in any ad the licensee publishes. Using the term REALTOR® by REALTOR® members is sufficient to identify yourself as a broker or salesperson.

The following is an example of unacceptable ad copy:

2-bedroom apartment available
Jacob McCandles and Company
Call Rooster Cogburn: 512-555-2222

The following are examples of acceptable ad copy:

2-bedroom apartment available
Jacob McCandles and Company, Real Estate Brokers
Call Rooster Cogburn, salesperson: 512-555-2222

2-bedroom apartment available
Jacob McCandles and Company, REALTORS® 
Call Jacob McCandles, broker: 512-555-2222


Do these same rules apply to commercial real estate brokers and salespeople as well? (updated Jan. 1, 2002)

Yes.


Must the license identification information be on each page of my Web Site? (updated Jan. 1, 2002)

Generally, yes.


If I do not identify any individual associate in an advertisement but only name the firm, must the license identification information be included? (updated Jan. 1, 2002)

If the name of the firm (regardless of the type of entity) does not readily identify the firm as a real estate brokerage firm, there must be an additional designation that identifies the firm as a real estate brokerage firm. For example, Available, Wil Anderson and Company, 512-522-2222 does not comply but, Available, Wil Anderson and Company, REALTORS®, 512-522-2222 complies.


The Farm and Ranch Contract has two sections related to fees: a Ratification of Fee and an Agreement for Payment of Brokers’ Fees. When should each be used? (Updated Dec. 4, 2015)

A listing broker who has already agreed to pay a commission to a cooperating broker—in the MLS, for example—should fill out the Ratification of Fee box. As in other TREC contracts, this simply authorizes the escrow agent to pay the cooperating broker from the listing broker’s fee at closing.

The seller and buyer should not sign the Agreement for Payment of Brokers’ Fees if the listing broker has already agreed to pay the cooperating broker’s commission elsewhere—this could bind the seller or buyer to pay additional amounts to the listing broker or the cooperating broker they didn’t intend.  The revised Farm and Ranch Contract, which takes effect January 1, 2016, now includes this instruction at the bottom of Page 9.

However, a seller and buyer could sign the Agreement for Payment of Brokers’ Fees if the listing broker hasn’t offered to pay a commission, like if the property wasn’t listed in the MLS. Note that the agreement states either the seller or the buyer will pay the brokers.


Legal Disclaimer: The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on TexasRealEstate.com. Any legal or other information found here, on TexasRealEstate.com, or at other sites to which we link, should be verified before it is relied upon.

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