22 TAC §§537.11, 537.20, 537.28-537.32, 537.37, 537.38
The Texas Real Estate Commission proposes amendments to §§537.11,
537.20, 537.28-537.32, 537.37 and 535.38, concerning standard contract forms.
The amendment to §§537.11 would add eight revised forms to the
list of standard contract forms promulgated by the commission. Three previously
promulgated addendum forms would be deleted from the list, because the sections
adopting those forms by reference are being proposed for repeal in connection
with the adoption of the revised contract forms. The forms were developed
by the Texas Real Estate Broker-Lawyer Committee, a committee of six real
estate brokers appointed by the commission and six attorneys appointed by
the President of the State Bar of Texas. Licensed real estate brokers and
salesmen are generally required to use contract forms promulgated by the
commission when negotiating the sale of real property. The eight revised
forms are TREC Number 9-3, Unimproved Residential Property Contract; TREC
Number 20-3, One-to-Four Family Residential Contract (Resale) All Cash, Assumption,
Third-Party Conventional or Seller Financing; TREC Number 21-3, One-to-Four
Family Residential Contract (Resale) FHA Insured or VA Guaranteed Financing;
TREC Number 23-2, New Home Contract (Incomplete Construction);TREC Number
24-2, New Home Contract (Completed Construction); TREC Number 25-2, Farm
and Ranch Contract; TREC Number 30-1, Residential Condominium Contract (Resale)
All Cash, Assumption, Third-Party Conventional or Seller Financing; and TREC
Number 31-1, Residential Condominium Contract (Resale) FHA Insured or VA
Guaranteed Financing. The three forms being deleted from the list of promulgated
forms are TREC Number 2-4, Property Condition Addendum, TREC Number 27-0,
Addendum for Inspection with Right to Terminate, and TREC Number 35-0, Agreement
for Mediation.
Provisions in the forms which have been revised include personal property
included in the sale, financing terms, title insurance and survey, statutory
disclosure requirements, inspections and repairs, notices to the parties,
representation and brokers fees, settlement and other expenses, proration
of taxes and interest, casualty repairs, dispute resolution, and attorney's
fees. A number of nonsubstantive wording changes have been made to make the
provisions clearer. The forms have been reprinted in a larger font which
makes them easier to read and distinguishes them from the forms currently
in use. These actions are necessary to update and standardize the forms used
by real estate licensees in negotiating real estate sales.
The amendment to §537.20 adopts by reference form TREC Number 9-3,
Unimproved Property Contract, replacing form TREC Number 9-2. The amendment
to §537.28 adopts by reference form TREC Number 20-3, , replacing form
TREC Number 20-2. The amendment to §537.29 adopts by reference form
TREC Number 21-3, replacing form TREC Number 21-2. The amendment to §537.30
adopts by reference form TREC Number 23-2, replacing form TREC Number 23-1.
The amendment to §537.31 adopts by reference form TREC Number 24-2,
replacing form TREC Number 24-1. The amendment to §537.32 adopts by
reference form TREC Number 25-2, replacing form TREC Number 25-1. The amendment
to §537.37 adopts by reference form TREC Number 30-1, replacing form
TREC Number 30-0. The amendment to §537.38 adopts by reference form
TREC Number 31-1, replacing form TREC Number 31-0.
Mark A. Moseley, general counsel, has determined that for the first five-year
period the sections are in effect there will be no fiscal implications for
state or local government as a result of enforcing or administering the sections.
Any revenue received by the Texas Real Estate Commission from the sale of
copies of the forms would be offset by the costs of making the copies available.
There is no anticipated impact on local or state employment as a result of
implementing the section.
Mr. Moseley also has determined that for each year of the first five years
the sections as proposed are in effect the public benefit anticipated as
a result of enforcing the sections will be the availability of sandardized
contract forms for use in real estate transactions. There will be no effect
on small businesses. There is no anticipated economic cost to persons who
are required to comply with the proposed sections other than the cost of
the forms, estimated at $5.00 per pad of 50 copies.
Comments on the proposal may be submitted to Mark A. Moseley, General Counsel,
Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
The amendment and new sections are proposed under Texas Civil
Statutes, Article 6573a, §16(e), which authorize the Texas Real Estate
Commission to adopt rules requiring real estate brokers and salesmen to use
contract forms which have been prepared by the Texas Real Estate Broker-Lawyer
Committee and promulgated by the Texas Real Estate Commission.
The proposed sections affect Texas Civil Statutes, Article 6573a, §16.
§537.11.Use of Standard Contract Forms.
(a)
[Standard Contract Form TREC No. 2-4 is promulgated for
use as an addendum only to another promulgated standard contract form. ]
Standard Contract Form TREC No. 9-3 [9-2] is promulgated for use in the sale
of unimproved property where intended use is for one to four family residences.
Standard Contract Form TREC No. 10-2 is promulgated for use as an addendum
concerning sale of other property by a buyer to be attached to promulgated
forms of contracts. Standard Contract Form TREC No. 11-3 is promulgated for
use as an addendum to be attached to promulgated forms of contracts which
are second or "back-up" contracts. Standard Contract Form TREC No. 12-1 is
promulgated for use as an addendum to be attached to promulgated forms of
contracts where there is a Veterans Administration release of liability or
restoration entitlement. Standard Contract Form TRECNo. 13-1 is promulgated
for use as an addendum concerning new home insulation to be attached to promulgated
forms of contracts. Standard Contract Form TREC No. 15-2 is promulgated for
use as a residential lease when a seller temporarily occupies property after
closing. Standard Contract Form TREC No. 16-2 is promulgated for use as a
residential lease when a buyer temporarily occupies property prior to closing.
Standard Contract Form 20-3 [20-2] is promulgated for use in the resale of
residential real estate where there is all cash or owner financing, an assumption
of an existing loan, or a conventional loan. Standard Contract Form TREC
No. 21-3 [21-2] is promulgated for use in the resale of residential real
estate where there is a Veterans Administration guaranteed loan or a Federal
Housing Administration insured loan. Standard Contract Form TREC No. 23-2
[23-1] is promulgated for use in the sale of a new home where construction
is incomplete. Standard Contract Form TREC No. 24-2 [24-1] is promulgated
for use in the sale of a new home where construction is completed. Standard
Contract Form TREC No. 25-2 [25-1] is promulgated for use in the sale of
a farm or ranch. Standard Contract Form TREC No. 26-2 is promulgated for
use as an addendum concerning seller financing. [Standard Contract Form TREC
No. 27-0 is promulgated for use as an addendum to be attached to promulgated
forms of contracts where there is an inspection with a right to terminate.]
Standard Contract Form TREC No. 28-0 is promulgated for use as an addendum
to be attached to promulgated forms of contracts where reports are to be
obtained relating to environmental assessments, threatened or endangered
species, or wetlands. Standard Contract Form TREC No. 29-0 is promulgated
for use as an addendum to be attached to promulgated forms of contracts where
an abstract of title is to be furnished. Standard Contract Form TREC No.
30-1 [30-0] is promulgated for use in the resale of a residential condominium
unit where there is all cash or seller financing, an assumption of an existing
loan, or a conventional loan. Standard Contract Form TREC No. 31-1 [31-0]
is promulgated for use in the resale of a residential condominium unit where
there is a Veterans Administration guaranteed loan or a Federal Housing Administration
insured loan. Standard Contract Form TREC No. 32-0 is promulgated for use
as a condominium resale certificate. Standard Contract Form TREC No. 33-0
is promulgated for use as an addendum to be added to promulgated forms of
contracts in the sale of property adjoining and sharing a common boundary
with the tidally influenced submerged lands of the state. Standard Contract
Form TREC Form No. 34-0 is promulgated for use as an addendum to be added
to promulgated forms of contracts in the sale of property located seaward
of the Gulf Intracoastal Waterway. [Standard Contract Form No. 35-0 is promulgated
for use as an addendum to be added to promulgated forms of contracts as an
agreement for mediation.] Standard Contract Form TREC Form No. 36-0 is promulgated
for use as an addendum to be added to promulgated forms in the sale of property
subject to mandatory membership in an owners' association. Standard Contract
Form TREC Form No. 37-0 is promulgated for use as a resale certificate when
the property is subject to mandatory membership in an owners' association.
(b)-(h)
(No change.)
§537.20.Standard Contract Form TREC No. 9-3 [9-2].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 9-3 [9-2] approved by the Texas Real Estate Commission in 1997
[1993]. This document is published by and available from the Texas Real Estate
Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.28.Standard Contract Form TREC No. 20-3 [20-2].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 20-3 [20-2] approved by the Texas Real Estate Commission in
1997 [1993]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.29.Standard Contract Form TREC No.21-3 [21-2].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 21-3 [21-2] approved by the Texas Real Estate Commission in
1997 [1993]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.30.Standard Contract Form TREC No. 23-2 [23-1].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 23-2 [23-1] approved by the Texas Real Estate Commission in
1997 [1993]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.31.Standard Contract Form TREC No. 24-2 [24-1].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 24-2 [24-1] approved by the Texas Real Estate Commission in
1997 [1993]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.32.Standard Contract Form TREC No. 25-2 [25-1].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 25-2 [25-1] approved by the Texas Real Estate Commission in
1997 [1993]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.37.Standard Contract Form TREC No. 30-1 [30-0].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 30-1 [30-0] approved by the Texas Real Estate Commission in
1997 [1994]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
§537.38.Standard Contract Form TREC No. 31-1[31-0].
The Texas Real Estate Commission adopts by reference standard contract
form TREC No. 31-1 [31-0] approved by the Texas Real Estate Commission in
1997 [1994]. This document is published by and available from the Texas Real
Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Issued in Austin, Texas, on March 18, 1997.
TRD-9703738
Mark A. Moseley
General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: April 17, 1997
For further information, please call: (512) 465-3900
22 TAC §§537.13, 537.34, 537.42
(Editor's note: The text of the following sections proposed for
repeal will not be published. The sections may be examined in the offices
of the Texas Real Estate Commission or in the Texas Register office, Room
245, James Earl Rudder Building, 1019 Brazos Street, Austin.)
The Texas Real Estate Commission proposes the repeal
of §§537.13, 537.34 and 537.42, concerning standard contract forms.
These sections adopt by reference standard contract addendum forms which
are promulgated for use by Texas real estate licensees. The repeals are proposed
in connection with revisions of the other contract forms promulgated by the
commission. If the revised contract forms are adopted by the commission,
the addenda would no longer be necessary; because their subjects would be
addressed in the revised forms.
Section 537.11 concerns the Property Condition Addendum, form TREC No.
2-4, a contract addendum providing for the inspection of a property for termites
and items in need of repair. Section 537.34 concerns the Addendum for Inspection
with Right to Terminate, form TREC No. 27-0, an addendum permitting the buyer
to inspect the property with a right to terminate the contract within a stated
period. Section 537.42 concerns the Agreement for Mediation, form TREC No.
35-0, an addendum obligating the parties to submit disputes to mediation
before litigation.
Mark A. Moseley, general counsel, has determined that for the first five-year
period the repeals are in effect there will be no fiscal implications for
state or local government as a result of enforcing or administering the repeals.
There is no anticipated impact on local or state employment as a result of
implementing the repeals.
Mr. Moseley also has determined that for each year of the first five years
the repeals as proposed are in effect the public benefit anticipated as a
result of enforcing the repeals will be the availability of standardized
contract forms for use in real estate transactions. There will be no effect
on small businesses. There is no anticipated economic cost to persons who
are required to comply with the proposed repeals.
Comments on the proposal may be submitted to Mark A. Moseley, General Counsel,
Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
The repeals are proposed under Texas Civil Statutes, Article
6573a, §16(e), which authorize the Texas Real Estate Commission to adopt
rules requiring real estate brokers and salesmen to use contract forms which
have been prepared by the Texas Real Estate Broker-Lawyer Committee and promulgated
by the Texas Real Estate Commission.
The proposed repeals affect Texas Civil Statutes, Article 6573a, §16.
§537.13.Standard Contract Form TREC No. 2-4.
§537.34.Standard Contract Form TREC No. 27-0.
§537.42.Standard Contract Form TREC No. 35-0.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Issued in Austin, Texas, on March 18, 1997.
TRD-9703737
Mark A. Moseley
General Counsel
Texas Real Estate Commission
Earliest possible date of adoption: April 17, 1997
For further information, please call: (512) 465-3900