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It appears that the inspector who inspected my home before my purchase missed major termite infestation. Yes. I am having problems with a manufactured home that I purchased recently and wish to file a complaint against the manufacturer and broker/dealer. The Texas Real Estate Licensing Act Section 1101.002 (1) (A) (x) prohibits an unlicensed person, on behalf of another, from controlling the acceptance or deposit of rent from a resident of a single-family residential real property unit in exchange for, or with the expectation of, a commission or other valuable consideration. [TRELA 1101.652(b)(23) and Rule 535.155(d)(7)], Yes. Inspectors are free to use or not use a contract. The proposed amendments also remove single-system inspections from the list of exemptionsmeaning the requirements in 535.223 would apply to those inspections. Pursuant to Section 535.229(b)(3)(A)(ii), a garage receptacle that does not have GFCI protection is deficient and must be reported as such. When the real property concerned is located wholly or partly in Texas, the broker must obtain a Texas license or associate with a Texas broker. [Rule 535.2(e)] However, the broker remains responsible for the authorized acts of the brokers sales agents [TRELA 1101.803, Rule 535.2(a) ] and has many affirmative duties regarding written policies, record keeping and advising, training, approving advertising for and responding to sales agents. [Rule 535.154(a)(5)]. Can TREC give me information about what codes the inspector is referring to? Can I advertise that I will rebate a part of my compensation to the buyer? 2. a required reporting item? 30-16, Residential Condominium Contract (Resale), Standard Contract Form TREC No. What are my rights as a tenant? Yes. The Texas Association of Realtors (TAR) provides certain forms to its members. There is no prohibition against a license holder presenting more than one offer at a time to a seller. Section 535.228(e)(3)(A) of the Standards of Practice states that inspectors are not required to report cosmetic damage or the condition of floor, wall, or ceiling coverings. My wife and I signed an offer to buy a house over the weekend. The changes to the existing rules add the title of the form adopted by reference in each rule to the rule title and add clarifying language to specify which forms are for mandatory versus voluntary use by license holders. Is the inspector required by the SoP to be knowledgeable of local requirements? [TRELA 1101.002(1) and Rules 535.4 and 535.5]. For additional information, read Rule 535.2 regarding broker responsibility. Verify contact information on the Application Summary page and click Submit. If no Disciplinary Search line appears under your name search result, then there have not been any disciplinary actions taken against that license holder. Do the Standards of Practice require inspectors to report as deficient the presence of a commingled water heater drain pan drain line and a temperature/pressure relief drain line? Study with Quizlet and memorize flashcards containing terms like Real estate professionals have been required to be licensed in Texas for quite some time. The definition of accepted industry practice is situation-specific and may depend on the context in which the question is being asked. REAL ESTATE BROKERS AND SALES AGENTS SUBCHAPTER A. See [Rule 535.146(c)(6)]. If the individual was only acting in one capacity, you should file the complaint with the agency that regulates that function. Can the inspector advertise that he inspects plumbing? Additionally, in the Unimproved Property Contract, the Sellers Disclosures paragraph has been amended to: (i) add check boxes to each disclosure item to indicate whether the seller is or is not aware; and (ii) add two additional disclosures relating to whether the property is located in a floodplain or if any tree located on the property has oak wilt. [See 535.2(i)(6)]. The standards of practice are not based on a specific requirement such as those promulgated by model building codes. Practicing real estate without an active license is a criminal offense, specifically, a Class A misdemeanor punishable by confinement of up to one year in a county jail and a fine of up to $4,000. GENERAL PROVISIONS Sec. Inspectors are not required to inspect to trade or industry association standards. [Rule 535.227(b)(3)(C)(i)]. Is it true that home inspectors licensed in Texas, cannot inspect plumbing in a home nor report plumbing deficiencies in the TREC inspection report? Evidence of a past fire is not, in itself, a deficiency. In order to mirror the format of 535.216 (which relates to inspectors), the relevant language of 535.93 has been added to 535.91. If the duties include showing or leasing the property for the owner for which the manager gets paid, a license is required. [See Rules 535.1(5) and 535.20(a)]. A real estate license is not required for a person who calls an auction of real property, provided the person is licensed as an auctioneer by the Texas Department of Licensing and Regulation. For a general partnership or individual broker, the assumed business name is filed with the county clerk in the county or counties where you do business. The changes to the existing rules add the title of the form adopted by reference in each rule to the rule title and add clarifying language to specify which forms are for mandatory versus voluntary use by license holders. 1101.801. You can ask the original broker to release you from the agreement or contact a private attorney to advise you if you can terminate the listing agreement in some other fashion. No. Can an individual sales agent use an assumed business name in advertising? If you are acting on your own behalf or on behalf of your spouse, parent or child, you must inform any person with whom you deal that you are a licensed broker or sales agent acting on that relatives behalf. Language related to license reinstatement is removed from 535.55. If the license holder did not participate in that specific transaction, he cannot state or imply that his actions resulted in the sale of that property. Is the Information About Brokerage Services Form promulgated by TREC mandatory? A sales agent may not accept compensation for a real estate transaction from anyone other than the broker the sales agent was associated with at the time the commission was earned and may not pay a commission to a person except through the sales agents sponsoring broker. Texas Real Estate License ACT (TRELA) (Purpose) 1. Additionally, you may not use your expertise to the disadvantage of others with whom you deal. [Rule 535.146(c)(2)] The Commission can take disciplinary action against you if you fail within a reasonable time to properly account for or remit money that you receive on behalf of another person. In 22 TAC 535.133, proposed changes are made to remove references to residency requirements, which were removed from Chapter 1101, Texas Occupations Code, as a result of the agencys most recent Sunset review. None of the issues you listed would necessarily be required to be reported as deficiencies; this determination depends on several factors, such as the design of the system. The changes to the existing rules add the title of the form adopted by reference in each rule to the rule title and add clarifying language to specify which forms are for mandatory versus voluntary use by license holders. My client does not want to accept the property as is. Neither loose carpet nor floor squeaks, without further evidence of deficient conditions, is required to be reported as deficient. When can an agent say that they sold a property in an advertisement? What is the definition of an accepted industry practice? Before the earnest money was deposited, the buyer backed out. TREC attorneys can provide general advice about the applicability or interpretation of the provisions of The Real Estate License Act and TREC Rules but cannot, with few exceptions, give advice pertaining to specific matters or transactions, other laws, or civil matters. For example, you may have paid a fee to obtain an option period in the contract. The license holder should inform the purchaser that the license holder is employed by the lender and give the names of several institutions to the purchaser. I bought a house from a builder and the builder gave me a 12-month warranty. Recovery of these losses is a civil action and should be discussed with a private attorney. Do the Standards of Practice require inspectors to report copper gas lines as deficient? If a buyer wishes to have a hydrostatic test performed on a home, what is required for a seller to consent to such a test? [Rule 535.155 (effective May 15, 2018)] You may advertise an inspectors services, however, an inspector may not pay a fee or other valuable consideration for (1) a referral, (2) inclusion on a list of inspectors or preferred providers, or a similar arrangement; or (3) inclusion on a list of inspections contingent on other financial agreements. Please check with the licensing authority in the state where the brokerage activity will be performed. Although a license holder may not pay an unlicensed person valuable consideration for referring a potential lessee or buyer, gifts of merchandise with a retail value of $50 or less are not considered valuable consideration. My broker did not fill out our contract properly and the effective date is blank. Section 535.233(2)(B)(i), however, requires an inspector to report as deficient the presence of a single blockable main drain. Help! New paragraph 9.B(5) provides that private transfer fees will be the obligation of the seller, unless otherwise provided in this contract. Theproposed amendments to Chapter 535 are made as a result of the Commissions quadrennial rule review. The proposed change to 535.54 reflects the proposed repeal of 535.93. Section 535.231(a)(3)(D)(iii) does not require inspectors to inspect inaccessible gas supply system components for leaks. A key distinction between a limited function referral office and another brokerage is the agreement between the agent and the broker to limit the agents actions to generating referrals. Probably not. The Farm and Ranch Contract also contains the following additional changes: The changes to the existing rules add the title of the form adopted by reference in each rule to the rule title and add clarifying language to specify which forms are for mandatory versus voluntary use by license holders. These may be found on our website about Rules Governing Inspectors. This must be done before making the payment. Yes, Commission Rule 535.3 permits you to receive any compensation through your current sponsoring broker or the broker who sponsored you at the time you earned the right to the compensation. My brother-in-law says I might be able to recover a judgment. This section gives the Commission authority to suspend or revoke a license holder that has entered a plea of guilty or nolo contendere or has been convicted of a felony or any criminal offense that involves fraud (including misdemeanors). Is a receptacle on a garage ceiling that is not GFCI protected deficient and a required reporting item per TREC? Theproposed changes to 535.64 streamline the rule and modify two of qualifying course approval forms that are adopted by reference. (3) the communication is at an open house and the communication concerns that same property. TREC Rules do not prohibit a broker from using the word team or group anywhere in a brokers licensed or assumed business name. My business entity is a series LLC. Inspectors are not required to remove water heater covers to inspect the water heater. The use of net listing agreement places the brokers interest above the principals interest with regards to obtaining the best possible price. Pursuant to the general limitations in the Standards of Practice, inspectors are not required to determine the presence of Chinese drywall or to report its symptoms or risks. [TRELA 1101.005(2) and Rule 535.32]. Please note that TREC cannot order a license holder to pay money damages. Before a broker or sales agent sponsored by the broker can represent both the buyer and seller in a transaction, all of the following steps must occur: Under Rules 535.154 and535.155 (effective May 15, 2018), an advertisement is defined asany form of communication by or on behalf of a license holder designed to attract the public to use real estate brokerage services and includes, but is not limited to, all publications, brochures, radio or television broadcasts, all electronic media including email, text messages, social media, the Internet, business stationery, business cards, displays, signs and billboards." Those rules prohibit a license holder from adding anything except factual matters or business details to a form adopted by TREC for mandatory use. Section 535.228(h)(1)(B) of the Standards of Practice requires inspectors to report deficiencies in steps, stairways, landings, guardrails, and handrails as deficient. The proposed new 535.157 requires a broker or sales agent to respond to their principal, a broker or sales agent representing another party to a real estate transaction, or an unrepresented party to a real estate transaction within two calendar days. [Rule 535.146(b)(3)]. The brokers name in at least half the size of the largest contact information for any sales agent, associated broker, or team name contained in the advertisement. I recently purchased an older home that was inspected before the purchase. [Rule 535.154(a)(5)]. Is the definition of accessible, as applied to gas appliance connections, left to the reasonable judgment of the inspector? Finally, subsection (i) is removed to more appropriately reflect agency practice and jurisdiction. If you reapply less than one year from passing one section of the exam, you will not need to retake that section. In 22 TAC 535.132, proposed changes are made to remove references to the waiver provisions in 535.55 and 535.56, as well as residency requirements, which were removed from Chapter 1101, Texas Occupations Code, as a result of the agencys most recent Sunset review. The primary duty of the agent is to represent the interests of the agents client, not the agent's own interests. In addition, pursuant to Chapter 53 of the Texas Occupations Code (www.statutes.legis.state.tx.us/) and Rule 541.1(c), TREC will consider evidence of certain mitigating factors and rehabilitation. 41-3, Loan Assumption Addendum, Standard Contract Form TREC No. Additionally, if you are a sales agent, Rule 535.3 permits you to receive compensation through your current sponsoring broker or the broker who sponsored you at the time you earned the right to the compensation. Does a trust account have to have a special name? No. [TRELA 1101.005(4)] However, it is clear from the statute that an auctioneer may not perform any act of a broker or sales agent, such as the preparation of a written agreement for the transaction. All license holders criminal backgrounds are rechecked upon renewal, however, this does not excuse a license holder from notifying the Commission not later than the 30th day after the final conviction. The changes are either updates to terminology or form for consistency throughout the chapter or are made to reflect updated processes. Is a licensed attorney required to hold a real estate license to act as a broker? Does TREC consider a logo that contains the brokers full name sufficient for the broker name requirement? The inspector must use reasonable judgment in determining if the emergency escape and rescue openings are sufficient for the intended purpose of the openings for the inspectors client. (6) the buyer executes a Buyer Representation Agreement or other written document that authorizes the broker to act as intermediary and specifies the conduct that is prohibited under TRELA 1101.651(d) in conspicuous bold or underlined print. Rule 535.34 provides guidelines to determine if evidence of an employer/employee relationship exists. Language related to license reinstatement is removed from535.56. No. Then click on the license holders name from the list that you are given. A license holders failure to properly complete a TREC promulgated form completely and accurately could be considered negligence and subject the license holder to disciplinary action. Can a rental locator rebate a portion of the rental locators fee received from the apartment complex to a prospective tenant if the tenant uses the locators services? The proposed changes to 535.141 are made to better track Chapter 1101, Occupations Code, and to better reflect the potential for consumer harm. When a broker holds money from property management activities in a trust account, how often is a broker required to account for that money? The Commission members have instructed the staff to enforce the law vigorously. (a) The Texas Real Estate Commission consists of nine members appointed by the governor with the advice and consent of the senate as follows: (1) six members who have been engaged in the brokerage business as licensed brokers as their major occupation for the five years preceding appointment; and (2) three members who represent the public. The listing broker can agree to reduce the commission if requested by the seller without violating the prohibition on splitting. Does TREC ever discipline a license holder who fails to use an adopted form? A mistake in the use of a form may result in financial loss or an unenforceable contract. The proposed changes to 22 TAC535.72 are being made to reflect the fact that in 2021, a new eight-hour non-elective coursethe Inspector Legal and Ethics and Standards of Practice Reviewreplaced the two four-hour courses in 2021. No, but this exemption only applies to apartments; managers of condominiums or town homes need to be licensed. Yes, as long as the advertisement complies with Rule 535.155 (effective May 15, 2018)regarding any restrictions that might apply. The Standards of Practice do not require an inspector to dig up gas lines in order to determine their condition. A buyer can use the option period to perform an inspection of the property and negotiate an amendment to the contract for any necessary repairs as a result of the inspection. Click on this to see what disciplinary actions have been taken. [TRELA 1101.652(b)(23) and Rule 535.154(a)(5)]. What is the difference if a broker appoint sales agents to represent the buyer and the seller or if the broker makes no appointments to the principals in a real estate transaction? The proposed changes update terminology for consistency and clarity throughout the chapter. A license holder shall not use the license holders expertise to the disadvantage of a person with whom the license holder deals. 51-1, Addendum Regarding Residential Leases, Standard Contract Form TREC No. A broker may authorize another license holder to withdraw or transfer money from a trust account. The broker may appoint an agent to represent the seller and an agent to represent the buyer. No. What are the steps to formation of an intermediary relationship? What is the estimated time frame to process an Fitness Determination (FD) form? Is the presence of a gas shut off valve that requires a tool to turn off deficient? Is the absence of a dirt or drip leg, 1. a deficiency? The proposed change in 22 TAC 535.66(c)(1) is made to reflect current course approval practice by the Texas Higher Education Coordinating Board. In order to mirror the format of rule 22 TAC 535.216 (which relates to inspectors), the relevant language of 535.93 has been added to 22 TAC 535.91. property management or commercial, is also an assumed business name of the broker, even though it may not be available for use by all sponsored agents and associated brokers. Does a link to the IABS Form in my email signature satisfy the representation disclosure required by TRELA 1101.558? [Rule 535.146(c)(3)] Accounting is more simple if the broker puts all escrow money into a non-interest bearing account, To avoid an advertisement that implies the sales agent is responsible for the operation of the brokerage in this situation, the sales agent should make sure that the ad clearly indicates that the sales agent is not the broker. How should an inspector positively identify fire-rated doors when the markings are covered by paint? The Commission can issue an order revoking the license of a locator found to have engaged in this practice. [TRELA 1101.652(b)(23)], No. If installed and if visible, the installation described in your question is required to be reported as a deficiency. The information is not supposed to appear on a background check; however it still may by mistake. A sales agent may work from an office location different from the main office of the sales agent's sponsoring broker, but the sponsoring broker is still responsible for the sales agent's actions. In addition, once an owner of a manufactured home has completed the detailed TDHCA process to treat the manufactured home as real property, the TDHCA licensing requirement does not apply to a TREC license holder. [Rule 535.147(d)]. [Rule 535.146(e)]. Yes, if the real estate business entity holds a real estate license and the sales agent is sponsored by that entity. Both the State and National sections of the exam must be passed before the application expiration date. Request inactive status by following the steps below: If you prefer, you can also submit the Application for Inactive Broker or Sales Agent Status form by email. No. The Standards of Practice do not address tamper-resistant receptacles. The sales agents agreement should also address how compensation is handled with the broker. A broker or designated broker of a business entity who sponsor one or more sales agents or a delegated supervisor of one or more license holders must complete the six-hour Broker Responsibility Course as part of the 18-hour CE requirement. However, because TREC must dispose of certain documents in accordance with a records retention plan, TREC may no long have those documents and an applicant should be prepared to resubmit documents and the explanation previously submitted. Must the permission of the owner authorizing the agent to offer the unit for rent be in writing? In addition, since it is not a violation of 1101.652(a-1)(1) or 1101.652(b) of the License Act, any judgment obtained would not be eligible for payment from the Real Estate Recovery Trust Account. The proposed amendments to 535.216 eliminate the lookback period currently found in 535.93, which allows a license holder to renew after the expiration date of their license without any lapse in active licensure, as long as certain certifications are made. At the top of TRECs homepage go to Search Licensee Info / Education and type in the license holders name and click. I was trying to buy a house and the earnest money was deposited in the broker's escrow or trust account. TREC does not require a pre-inspection or employment contract to be signed by the parties to the inspection. These licenses are issued by the Texas Structural Pest Control Service of the Texas Department of Agriculture at www.texasagriculture.gov. The requirements for emergency escape and rescue openings in sleeping rooms and the sill heights and sizes of the emergency escape openings in sleeping rooms have varied through the years. The Standards of Practice require inspectors to report as deficient the lack of a 1-3/8 solid wood or fire-rated door between a house and garage. [TRELA 1101.351(c)]. None of the forms promulgated by TREC are intended for use as a contract for deed. The proposed amendments to535.133 will limit an existing regulation to correspond with applicable law. Must a person be licensed to locate apartment units for prospective tenants and be paid by the owner of the apartments? No, provided you are an employee of the new home builder (being an independent contractor is not enough). If the inspection you are proposing is not in anticipation of a purchase or sale, then TREC's requirements would not apply, and the parameters of the inspection would be governed by the agreement between the inspector and his or her client. Any name used by an individual sales agent, other than the name on the license or a registered alternate name, is considered a team name under TREC rules and must meet the team name requirements. Added by Acts 2001, 77th Leg., ch. Is a screen combustion air opening a required reporting deficiency? The proposed repeal of 535.212reflects the expiration of this section by rule. It resides in Title 7 Chapter 1101 of the Texas Occupations Code. No. [TRELA 1101.751], An unlicensed person may not engage in any activity for which a license is required. The Commission may suspend or revoke or take other disciplinary action against a license holder who pays any portion of a commission or fee to anyone other than a licensed Texas broker or a broker licensed in another state. Yesterday, I discovered a big problem with the house that was never disclosed to me. 1101.758. [Rule 535.155(d)]. If a real estate broker has an escrow account, can the broker keep any interest that is earned on the money on deposit? No. You may want to have a private attorney create a contract for you, or you may check with some of the inspector trade associations to see if they provide templates of pre-inspection contracts. Yes, but the ad must disclose that payment of the rebate is subject to the consent of the seller and if the rebate is contingent upon certain restrictions, such as the use of a particular service provider, the ad must contain a disclosure that payment of the rebate is subject to restrictions. As a licensed inspector I would like to advertise that my company performs wood destroying insect inspections. Transcripts would need to be evaluated to determine whether the attorney may receive credit for any applicable courses. Written comments on proposed rulesare accepted for 30 days after publication in the Texas Register. Can a license holder rebate a portion of his commission to a seller?

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