The Texas REALTORS® since the 1990s has offered members the Release of Earnest Money form. The Texas Real Estate Commission this month proposed its own version of such a form, and TAR opposes the adoption of the TREC form.

Below are details of why TAR does not support TREC’s proposed form. If you agree, send your comments to

What the TAR form does

The Texas REALTORS® Release of Earnest Money form allows the parties to agree to release the earnest money and to release each other, any broker, title company, or escrow agent from liability under the contract. The association form also includes a notice explaining the effect of the form and encourages the parties to consult with an attorney.

How TREC’s form is different

The commission’s form doesn’t contain a clear release of liability of the buyer, seller, brokers, and the title company. Instead, it releases claims to the earnest money and then states: “Paragraph 15 of the contract provides that if the parties terminate the contract and release the earnest money, the parties release each other from the contract.”

The proposed form also contains instructions stating the form should not be used to unilaterally terminate the contract, and that the “parties confirm the contract is terminated.”

Why TAR opposes the proposed TREC form

The form is confusing and will lead to more uncertainty. The Texas REALTORS® form, which has been used successfully in Texas real estate transactions for over 20 years, is clear and consumers are better informed because of it.

  • There is no reason for TREC to adopt a form with different, less clear language.
  • There was no public comment received by TREC requesting a release of earnest money form.
  • There was no court decision or TREC enforcement action that raised any concern about the TAR form.
  • Other states have similar forms, which contain language releasing all liability under the contract.
  • If the TREC form is adopted, TAR will no longer be able to offer the association’s release of earnest money form.

The association doesn’t oppose a TREC release of earnest money form. However, if the commission wants to adopt such a form, it should adopt the TAR form’s language.