Do You Advertise Your Business? Read This!
Texas Real Estate Commission adopted new advertising rules at its November meeting. These rules are effective as of May 15, 2018, which gives license holders 6 months to comply with the updated requirements.
§535.154 lays out alternate, assumed business and team name registration requirements and §535.155 lays out the revised advertising requirements. You can read both rules on TREC'S website.
The Commission will soon provide a detailed article about the new rules on our website, including examples of do’s and don’ts, host a live online town hall on December 14th, and update advertising FAQ’s to reflect these changes.
It has come to our attention that some listings being inputted into the system are "Limited Service Agreements". We have no problem with these listings as they are needed for comp purposes and are being designated as one. But please be aware that as licensed real estate agents in the state of TEXAS you do have the responsibility to be in compliance with the Real Estate License Act, which in brevity states the following in accordance with TAR attorney's:
The Real Estate License Act contains provisions that impose requirements on all agents regarding client communications and negotiations. At a minimum, an agent must ...
These duties exist regardless of the agreed-upon compensation payable to the broker. An agent cannot avoid these requirements by removing himself from negotiations. The minimum-services provisions also prohibit a seller’s agent from instructing a buyer’s agent to negotiate directly with the represented seller. Likewise, a buyer’s agent is prohibited from instructing a seller’s agent to negotiate directly with the represented buyer.
There are certain circumstances in which an agent may deliver an offer to a represented party without violating the Real Estate License Act, but the agent must have the other broker’s consent to the delivery and send him a copy of the offer. At no time may the agent cross the boundary into negotiations with the represented party.
If the seller’s broker isn’t fulfilling the minimum duties required of him, there’s not much you can do in the short-term. You have a fiduciary duty to look after your client’s best interests; however, you may not interfere with the other broker’s agency relationship or do anything to prevent the transaction from closing. Continue to make every effort to contact the seller’s broker to discuss your concerns, and keep a record of your communications with him.
If you believe the seller’s broker violated any rules or the REALTOR® Code of Ethics, you may take steps to file a complaint with the Texas Real Estate Commission or the Texas Association of REALTORS®.
If you believe that you deserve an additional fee, you may seek compensation through arbitration or other legally available means after the transaction closes.
At TexasBrokerSponsor.com we are always searching for ways to bring value to our clients, agents, and business entity brokerages. If you are looking for a new broker to sponsor you or your LLC Brokerage please visit us at TexasBrokerSponsor.com to get started.
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Is it time to renew your business entity broker license with TREC?
Business entity broker licenses must be renewed every two years. You should receive a notice from TREC about your renewal 90 days prior to your license’s expiration date. You have to follow TREC’s requirements to renew your business entity broker license, which includes providing TREC with specific documents. This blog post outlines what those documents are. It’s a good idea to begin the renewal process early, since it can take some time to gather the information. If you miss the renewal, your entity's agents could lose sponsorship.
Are you afraid of the DTPA? You may not need to be
The Texas Deceptive Trade Practices—Consumer Protection Act is intended to protect consumers from false, misleading, or deceptive acts or practices, unconscionable actions, and breaches of warranty. Through legislative success and other risk-management tools, the Texas Association of REALTORS® has worked to protect you from frivolous lawsuits and unfair claims. Learn more in the March issue of Texas REALTOR® magazine or by watching this month's Texas REALTOR® Magazine Minute.
Tips to avoid being subject to one of the most common Code of Ethics complaints
It's probably no surprise that Article 12 was the most cited article in ethics complaints against Texas REALTORS® last year. Texas REALTOR® tells you what complaints covered and what you can do to comply with this often-violated part of the Code.
How to engage in your industry on your phone's screen
Just text txrealtors to 30644 to sign up for REALTOR® Party Mobile Alerts. You’ll get important alerts when something deserves your attention, like calls for action or a personalized voting guide.
The 2017 REALTOR® Day at the Texas Capitol is coming soon!
Make sure you've planned your trip to Austin on April 4 for this year's REALTOR® Day at the Texas Capitol. Join your fellow Texas REALTORS® to meet with state lawmakers to discuss property-tax relief, consumer-friendly reforms to the property-appraisal process, and more. You'll get an inside look at the legislative process, tour the TAR headquarters, and enjoy a barbecue lunch with your friends. Visit texasrealestate.com/realtorday for more information.
More links for Texas REALTORS®
If I represent the seller, can I advertise that I will rebate part of my commission to the buyer?
A: 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. [Rule 535.154(m)] A sales agent must also have their sponsoring broker's authorization to offer a rebate.
However, a rebate to a buyer from a license holder may be subject to restrictions by the buyer’s lender. You should contact your broker or private attorney to find out how you should notify and obtain the consent of the buyer’s lender to address any impact the rebate may have on the determination regarding the buyer’s creditworthiness.
Stay Compliant and Always Disclose, Disclose, Disclose!
A broker, who is also the designated officer of a Business Entity, will have two license numbers; the individual broker’s license and the business entity broker’s license. Sales Agent’s requesting the sponsorship through the Relationship Management Tool (RMT) should verify the correct license number for their sponsoring broker PRIOR to submitting the online request. Once the fee is paid, the fee is non-refundable or transferrable. Once the request and payment are submitted, an email will be sent to the broker. The sponsorship will be in effect when the broker accepts the sponsorship request.
At TexasBrokerSponsor.com we strive to be your broker sponsorship solution. We welcome experienced agents and newly licensed agents to become part of our growing Texas-wide agent team. If you looking to earn more on every sales or leasing transaction we can help make that happen Make 2017 the year you make the move to increase your income.
TREC Rule 535.16(c) provides two instances in which a real estate licensee is required to provide a broker price opinion (BPO) or comparative market analysis (CMA) on a property. The first instance is when a licensee negotiates a listing. For example, if a listing broker is negotiating the terms of a listing agreement with a seller, the listing broker must provide the seller with a BPO or CMA. Note: The rule does not provide for a specific time for a BPO or CMA to be given to the seller. However, the appropriate time would be when discussing the sales price.
The second instance in which a BPO or CMA is required is when a licensee is offering to purchase a property on his own behalf as a result of contact made while acting as a real estate agent. For example, a licensee represented a buyer and showed that buyer a specific property. After the buyer was no longer interested in the property, the licensee decided to submit an offer on that same property to purchase for himself. Since the licensee is submitting an offer on the property on his own behalf as a result of contact made while he was acting as a buyer’s agent, the licensee would now need to provide the seller with a BPO or CMA. reference source: TexasRealtors.com
Under TREC’s rules (§535.2), brokers and salespersons need to maintain business records including transaction files. These records must be kept in a retrievable format, whether paper or electronic. Communications between clients or customers may be considered to be part of negotiations and may be important records in a transaction. Therefore, brokers and salespersons should develop protocols for how these communications are retained as part of the business record.
Additionally, brokers and salespersons need to exercise care to avoid any statements in these communications that may be later construed as “misrepresentations” of any type, including but not limited to misrepresentations about the intentions of the client(s) with respect to making or accepting offers.
The agent’s statements in an email need to avoid giving the impression that a “deal is done” or that “a party accepts” an offer or counteroffer unless that is clearly the intention of the client and is supported with documentation such as the proper signatures or initials on the written contracts.
With few exceptions, agents do not have the authority to bind their clients, but they communicate for their clients regarding negotiations. That difference needs to be clearly understood by all those involved in the negotiations.
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