The Texas Real Estate Commission met on November 15. Here are rule changes relevant to your business.
Adopted changes to 535.2, Broker Responsibility
- Brokers must designate anyone who leads, supervises, or directs a team in their brokerage as a delegated supervisor with TREC if he or she has or will be supervising for more than three months. This will require that person to take the six-hour broker responsibility course at each license renewal.
- The time frame that a broker or delegated supervisor has to respond to clients, agents, or other brokers is now two days.
- The time frame that a broker or delegated supervisor has to deliver TREC correspondence to their agents is now three days.
- In the section covering records retention, the term “work files” is deleted and replaced with “substantive communications with parties to the transaction” to clarify what should be retained. Offers should also be retained.
- Brokers must ensure—through their brokerage policies and procedures manual—that agents are geographically competent in the market area being served; and that brokers will ensure training or coaching for new agents when they undertake new tasks.
The members-only Model Brokerage Policies and Procedures Manual, which gives brokerages instant compliance with TREC requirements to maintain written policies and procedures, will be updated with these changes.
Adopted form revisions
The revised forms will be mandatory for use March 1, 2019, but you can use them voluntarily as soon as they become available. The association will work with all forms vendors to post the forms as quickly as possible.
Third Party Financing Addendum
- The language in the Property Approval section will change to require that if the buyer wants to terminate the contract under this paragraph, the buyer must give the seller written notice not later than three days before the contract’s closing date and must provide the seller written evidence of the lender’s determination.
- The form was reformatted and other non-substantive changes were made for consistency with other TREC-promulgated forms.
Notice of Buyer’s Termination of Contract
- Statement added that a buyer terminating the contract under the Property Approval section of the Third Party Financing Addendum has delivered to the seller a written statement from the lender as to why the property isn’t approved in line with the changes to the Third Party Financing Addendum.
- Box added to check if the buyer is terminating under Paragraph 3 of the Addendum Concerning Right to Terminate Due to Lender’s Appraisal.
- Box added to check if the buyer is terminating under Paragraph 6D of the contract because timely objections were not cured by the end of the cure period.
Addendum Concerning Right to Terminate Due to Lender’s Appraisal
- Statement added clarifying that this form is to be used only if the Third Party Financing Addendum is part of the contract (and the transaction still cannot involve FHA or VA financing).
- Non-substantive changes were adopted to make the form clearer.
Other adopted changes
TREC Rule 535.101, Fees, is amended to reduce the fee from $20 to $10 for an agent establishing or changing sponsorship. In addition, TREC has developed a free online license history certificate, so the $40 fee has been removed from the rule.
TREC Rule 535.191, Schedule of Administrative Penalties, is amended to move several violations to a lower tier of penalties and adds several violations from recently adopted rules and those missing from the penalty matrix.
Unless otherwise stated, the adopted changes become effective 20 days after the date they are filed with the Secretary of State.
Find the materials from the meeting on TREC’s website.