Education Course of Study

TRELA Flashcards

• Subchapter M - Real Estate Recovery Trust Account1. The fund is to be used to reimburse members of the

public who have been financially injured or damage by the actions of a real estate broker, sales agent, a certificate holder, or an employee or agent of a license holder.

• Subchapter G- Association & Approval of Real Estate

Education & Course of Study

• Commission may set rules for real estate cducation

programs or courses, their approval, and their providers.

• Describes 11 qualifying coursesa) Promulgated Contract Forms and Residential Inspection

for Real Estate Agents have both been established by TREC rules.b) At least 3 class hour of instruction on federal, state, and local laws relating to housing discrimination, housing credit discrimination, and community reinvestment

• Inspectors are Prohibited by law from doing the

following:

a) Accepting an assignment for real property inspection if

the employment or a fee is contingent on reporting specific, predetermined condition of the propertyb) Acting in a manner that is dishonest or fraudulent or involves deceit or misrepresentationc) Acting in the dual capacity of inspector and undisclosed principal, broker, or sales agentd) Performing repairs or maintenance in connection with a real estate inspection under an earnest money contract, lease, or exchange of real property

• Section 1101.759. Cease and desist order a) If it appears to the Commission that a person is violating

this chapter or chapter 1102, or a rule adopted under this chapter or chapter 1102 the comission, after notice and oportunity for a hearing, may issue a cease and desist order prohibiting the person from engaging in the activity.b) A violation of an order under this section constitutes grounds for imposing an administrative penalty under chapter O.

• Subchapter H- License Requirements1. Mandatory Licensure of all bussines entity,(real estate)

other than sole proprietorships.2. Licensed business entity must also have E&O insurance if the designated broker owns less than 10% of the business entity.3. A designated broker must be an "individual holding an active Texas real estate broker license designated by a bussiness entity licensed by the commission to act on its behalf."4."The designated broker must be an officer of a corporation, a manager of a limited liability company or a general partner of a partnership." This means that the designated broker of a business entity may not be another business entity; the designated broker must be a licensed individual.

• General criminal penaltya) A person commits an offense if the person willfully

violates or fails to comply with this chapter or a Commission order.b) An offense under this section is a Class A misdemeanor.

• Criminal penalty for certain violations by residential

rental locator

a) A person commits an offense if the person engages in

business as a residential rental locator in this state without a license issued under this chapter.b) An offense under this section is a class A misdemeanor.

• Subchapter K- Certificate Requirements 1. A right-of-way certificate is given to one who sells, buys,

leases, or transfers an easement or right-of-way for another for another for compensation2. Requires a right-of-way agent to register with the Texas Real Estate Commission unless the person is licensed as real estate broker or sales agent3. License holder has 10 days to notify TREC should there be a change in contact information Subchapter A- General Provisions1. Specifically describes activities for which broker and sales agent licensure is requireda) Short sale negotiators are now required to have a sales agent or broker license.(1) Places the responsibility for the sales agent's actions on the broker

b) Comparative Market Analysis (CMA) is not referred to as

an appraisal and must be given when (1) listing a property(2) assisting a buyer when making an offer, or (3) submitting an offer to the seller.

• Subchapter J- License Renewal1. Lays out requirements for the following:a) Active sales

agent licenseb) First sales agent apprentice renewalc) Active broker licensed) Continuing education

e) A subagent is a license holder who(1) represents a principal through cooperation with and the

consent of the seller and the broker representing the principal, and(2) is not sponsored by or associated with the principal's broker.

• F. Subchapter F- Broker Lawyer Committee 1. Compositiona) 13 membersb) 6 brokers, 6 Texas

attorneys, and 1 general member2. Terms are staggereda)

• -year termb) 6 straight years for the general member3.

The main function is to draft end revise forms for licensee usage.

m) If a license holder or certificate holder violates any

provision of the license act, the hearings and appeals peocesses and procedures are to be followed Got it!

b) Establishes educational and examination requirements

for licensing of inspectors, including (1) Professional inspectors(2) Real Estate inspectors (under the indirect supervision of a professional inspector), and (3) Apprentice inspectors (who are under the direct supervision of a professional inspector)

• Subchapter C-Admin & Other TREC Personnel 1. Texas Occupations Codea) Regulates Real estate

inspectors

j) A definite termination date does not apply to property

management agreements.Got it!

• Criminal penalty for certain violations by broker, sales

agent, or certificate holder

a) A person commits an offense if the person acts as a

broker or sales agent without holding a license under this chapter or engages in an activity for which a certificate of registration is required under this chapter withouth holding a certificateb) An offense under this section is a Class A MIsdemeanor (Revised, S.B. 699, 2016.)

d) Bussiness entity means:"A domestic" or "foreign entity"

• Subchapter O- Administrative Penalty1. The Commission may order a license holder or

certificate holder to pay a refund to a consumer instead of or in addition to any other penalty or sanction described in Subchapters O and P. The amount of the refund may not exceed the amount that the consumer actually paid to the person for a service or accommodation.

• Subchapter P- Other Penalties & Enforcement

Provisions/Consumer Advocacy

• Injunctive action brought by Commissiona) In addition to

any other action authorized by law, the Commission may bring an action in its name to enjoin a violation of this chapter or a commission rule.b) To obtain an injunction under this section, the Commission is not required to allege or prove that(1) an adequate remedy at law does not exist; or(2) substantial or irreparable damage would result from the continued violation.

• The act stipulatesA standar report form

i) The term advertisement must not mislead or deceive the

public.Because a listing might be solicited and accepted only in a broker's name, any advertisement containing listings must contain the name of the broker and must not mislead or decieve the public.

• Subchapter D- Commission Powers & Duties 1. Addresses the duties of the TREC
• Subchapter N- Prohibited Practices & Disciplinary

Proceedings

• Possible actions by a license holder that can result in the

revocation or suspension of a broker's or sales agent's license or right- of-way agent's certificate of regustration.2.Violations of state laws could also result in license revocation (e.g., nonpayment of awarded child support 3 or more months in arrears.3. TREC may not renew or reissue a license until the court or appropriate agency orders otherwise.4. TREC Rules further explain the following

practices:a) A licensed broker may not pay a commission

to or otherwise compensate a person directly or indirectly for performing an act of a broker unless the person is licensed in Texas or licensed as a broker in another state.b) If the broker is licensed out of state, all negotiations physically conducted within Texas must be handled by Texas license holders. Payment of referral fees to out-of-state brokers is authorized under this rule.c) An unlicensed person may share in the income earned by a real estate broker if the person engages in no acts for

which the license ia required and doesn not lead the public to believe that the person is in the real estate brokerage

business.(1) Example: a broker sharing his commission

with a buyer or a seller in a transactiond) A person may not assign to another license holder without first obtaining the written consent of the other parties to the contract.e) A listing agreement and buyer representation agreement are contracts for personal service of a license holder; therefore, they cannot be assigned without consent.f) Unless a different time to deposit earnest moneyis expressly agreed upon in writing by the principals to a transaction, the deposit is to be placed in a trust account maintained for that purpose or in trust with a title company by the close of business of the second working day after execution of the contract.g) If the earnest money check is dishonored by the bank on which it was drawn, the broker shall immediately notify all parties to the transaction.h) Disclosure of licensed status when acquiring or disposing of property as a principal may be in a sales or rental agreement or by disclosure in any other written form given before entering into any sales or rental contract.

• SubchapterI- Examinations1. Sets out the provisions for determining the competency

of the license applicant2. Must satisfy the examination requirement within one year from making application3.

Testing: the examinee must show a photo ID at the exam

site and may use a silent electronic, nonprogrammable, pocket sized calculator withouth an alphabetic keyboard or communication capabilities.4. An applicant who fails the exam three consecutive times is required to show that the applicant has subsequently completed additional education before the applicant can take the examination again or reapply for a license.

k) The unauthorized practice of law by a license or

certificate holder is defined.Got it!

• Subchapter L- Practice by a License Holder 1. Describes requirements for a broker's maintaining a

fixed office address and mandates title notice and property2. Defines the agency relationships3. Mandates