What is TREC?
The Texas Real Estate Commission, also known as TREC, is the governing body over all Texas real estate agents, brokers, inspectors and even home warranty companies. Since Texas law requires that the following information be readily available to all prospective buyers, tenants, sellers and landlords, we are posting to our blog so you can easily find it.
The purpose of this information is to assist homebuyers and sellers in understanding the terminology and rules that govern the industry. It is a code of ethics, if you will, and it is always advisable to familiarize yourself with the industry-specific rules and terms before entering into any transaction. The Gene Arant Team takes this code quite literally and we see this as the very basis of our duty to our clients. Our goal is to exceed our clients’ expectations and to ensure that each transaction is completed in a fair environment that is as stress-less as possible for our client. We hold our team to the highest moral and ethical standards and recognize that serving our clients is an honor. With that said, this blog will define the most pertinent words and rules written by TREC.
The Difference Between a Broker and a Real Estate Agent
A broker is responsible for all brokerage acts including all transactions made by a sales agent. A broker must sponsor a sales agent and then that agent can work directly with a client, acting on behalf of the broker.
A Broker is bound to:
- put their client’s interest above any other, including the broker’s own interest
- be honest and fair to all parties within a transaction
- inform their client to all material information regarding the property or transaction that they receive
- answer the client’s questions and present all offers and counter-offers from the client.
A license holder/real estate agent can represent a client, acting under the rules of a broker. An agent represents clients in the following types of transactions: as an agent for the owner, for the buyer/tenant or as an agent for both buyer and seller.
When acting as an agent for the buyer or seller, the broker becomes the agent usually through a written listing or agreement and is bound to abide by the rules listed above.
If an agent is acting on behalf of both parties, then that agent is called an intermediary. The written agreement must state who will pay the broker’s fee and clearly state the obligations of the broker to both parties. This includes:
- treating both sides of the party fairly and impartially
- the possibility of appointing to each party, with written consent, a different license holder with the broker, to communicate with, offer advise and carry out the instructions of each party
- that the agent will not, unless specifically authorized (in writing) by the client, disclose:
- that the owner should accept a price less than the written asking price
- that the buyer will pay a price greater than the price in writing
- any confidential information the client discloses to his agent
It is advised that all duties and responsibilities of the broker to a client are placed in writing. A clear understanding of expectation, written and signed as an agreement avoids disputes.
All agents and brokers alike have been issued the policy from TREC and have signed a receipt of acknowledgement. If you have any questions regarding these rules, please contact us, we are happy to speak with you about your current or future transactions. We look forward to working with you.