©OnCourse Learning. All Rights Reserved.
Chapter
9
Licensing Laws and Professional
Affiliation
©OnCourse Learning. All Rights Reserved.
In This Chapter

You will cover the various licensing
law requirements, emphasizing the
provisions of the Texas Real Estate
License Act.
©OnCourse Learning. All Rights Reserved.
Rationale for a Real Estate Licensing

Does the public have a vested interest in
seeing that real estate salespersons &
brokers have the qualifications of honesty,
truthfulness, good reputation, & real estate
knowledge before they are allowed to
negotiate real estate transactions on behalf of
others?
©OnCourse Learning. All Rights Reserved.
It was this concern that brought
about real estate licensing laws as
we know them today.
©OnCourse Learning. All Rights Reserved.
Real Estate Agent


A person who, for compensation or promise
of compensation, lists or offers to list, sells or
offers to sell, buy or offers to buy, negotiates
or offers to negotiate either directly or
indirectly for the purpose of bring about a
sale, purchase or option to purchase,
exchange, auction, lease, or rental of real
estate, or any interest in real estate
Must hold a valid real estate license.
©OnCourse Learning. All Rights Reserved.
License Types

Real Estate Broker


A person who, for another person and for a fee,
commission, or other valuable consideration, or with
the intention or in the expectation or on the promise of
receiving or collecting a fee, commission, or other
valuable consideration from another person for
conducting real estate brokerage activity as defined by
TRELA.
Real Estate Salesperson

A person associated with a Texas licensed real estate
broker for the purposes of performing acts or
transactions comprehended by the definition of "real
estate broker" as defined in this TRELA.
©OnCourse Learning. All Rights Reserved.
Exemptions
1.
2.
3.
4.
5.
6.
7.
An attorney.
An attorney in fact.
A public official in the conduct of official
duties.
A person conducting an auction.
A person acting under a court.
A person employed by an owner in the sale of
structures and land on which said structures
are located if the structures are erected by
the owner.
An on-site manager of an apartment complex.
©OnCourse Learning. All Rights Reserved.
Exemptions
8.
9.
10.
11.
12.
13.
An owner or his employees in renting or leasing
the owner's own real estate.
A partnership or limited liability partnership
performing an act constituting an act of a broker
or salesman through a partner who is duly
licensed as a real estate broker.
Transactions involving mineral or mining
interest.
Transactions involving cemetery lots.
Transactions involving hotels or motels.
The sale of real property under a power of sale.
©OnCourse Learning. All Rights Reserved.
Texas Salesperson Requirements







Before applying for a real estate Salesperson
License requiring 12 semester hours or 180
classroom hours, individuals must furnish
evidence of successfully completing the
following:
Principles of Real Estate course (60
classroom hours)
Law of Agency course (30 classroom hours)
Law of Contracts course (30 classroom hours)
Promulgated Contract Forms course (30
classroom hours)
Real Estate Finance course (30 classroom
hours)
additional requirement for the salesperson’s
first renewal: completion of 18 semester hours
of core real estate courses.
©OnCourse Learning. All Rights Reserved.
Texas Broker License
900 classroom hours or 60 semester hours




To be eligible to apply for a real estate Broker
License:
Four (4) years active experience & 3600 points
of qualifying practical experience plus
270 classroom hours of core real estate courses
including a 30-hour Real Estate Brokerage
course plus
An additional 630 classroom hours in related
courses
©OnCourse Learning. All Rights Reserved.
Continuing Education - MCE

A licensee must furnish TREC proof of
completing at least 15 classroom hours of
continuing education course every 2 years
approved by TREC taken during the term of
the current license.
©OnCourse Learning. All Rights Reserved.
License Required

A person may not act as a professional
inspector in this state for a buyer or seller of
real property unless the person possesses a
professional inspector license issued under
this section.
©OnCourse Learning. All Rights Reserved.
Home Inspectors


Professional inspector means a person who
represents to the public he is trained & qualified to
perform a real estate inspection & who accepts
employment for the purpose of performing a real
estate inspection for a buyer or seller of real
property.
Real estate inspector means a person who
represents to the public that the person is trained
and qualified to perform real estate inspections
under the indirect supervision of a professional
inspector and who accepts employment for the
purpose of performing a real estate inspection for a
buyer or seller of real property.
©OnCourse Learning. All Rights Reserved.
A licensed inspector may not:






accept an assignment for real estate inspection if the employment or
fee is contingent on the reporting of a specific, predetermined
condition of the improvements to real property or is contingent on
the reporting of specific findings other than those known by the
inspector to be facts at the time of accepting the assignment.
act in a manner or engage in a practice that is dishonest or
fraudulent or that involves deceit or misrepresentation.
perform a real estate inspection in a negligent or incompetent
manner.
act in the dual capacity of inspector and undisclosed principal in a
transaction.
act in the dual capacity of inspector and real estate broker or
salesperson in a transaction.
perform or agree to perform any repairs or maintenance in
connection with a real estate inspection pursuant to the provisions of
any earnest money contract, lease agreement, or exchange of real
estate.
©OnCourse Learning. All Rights Reserved.
http://www.TREC.state.Tx.us
©OnCourse Learning. All Rights Reserved.
TREC

Mailing Address:
Texas Real Estate Commission
P. O. Box 12188
Austin, TX 78711-2188

Street Address:
Texas Real Estate Commission
Stephen F. Austin Building
1700 N. Congress Ave., Suite 400
Austin, TX 78701
Phone: (512) 936-3000
Email: information@trec.texas.gov
©OnCourse Learning. All Rights Reserved.
Chapter 1101, Texas Occupations
Code - The Real Estate License Act
(Real Estate Brokers and
Salespersons) and Chapter 1102,
Texas Occupations Code (Real
Estate Inspectors), which include
revisions made by H.B. 3507, H.B.
1508 and S.B. 287, 78th Leg., R.S.
(2003).
©OnCourse Learning. All Rights Reserved.
Commission Membership



9 members appointed by the governor for
6 year terms
6 from real estate
3 from general public
©OnCourse Learning. All Rights Reserved.
License Suspension & Revocation


The commission may, on its own motion, and
shall, on the signed complaint in writing of any
person, provided the complaint, or the complaint
together with evidence, documentary or
otherwise, presented in connection with the
complaint, provides reasonable cause,
investigate the actions and records of a real
estate broker or real estate salesperson. The
commission may suspend or revoke a license
issued under the provisions of this Act or take
other disciplinary action authorized by this Act at
any time when it has been determined that:
See Appendix A in text
©OnCourse Learning. All Rights Reserved.
Recovery Fund


Will pay damages in the event a judgment is
obtained against a licensee and there are no
other funds recoverable from licensee.
Limits are $50,000 per transaction and
$100,000 against any one licensee.
©OnCourse Learning. All Rights Reserved.
Securities License


property being sold is an investment contract
in real estate rather than real estate itself
state and federal laws requiring the
registration of real estate securities
©OnCourse Learning. All Rights Reserved.
Broker Affiliation




Training – complement, enhance, and
encourage your personal development.
Compensation – usually a percentage of
earned commissions.
Support – what services do they offer.
Franchise offices
©OnCourse Learning. All Rights Reserved.
Independent Contractor


Paid only if a sale produces a commission
and is responsible for income taxes and
social security.
Employment Contract
©OnCourse Learning. All Rights Reserved.
REALTOR®





Registered trade name
Member of NAR
not synonymous with real estate agent
Code of ethics first adopted in 1913
GRI designation by taking sponsored
education courses by NAR
©OnCourse Learning. All Rights Reserved.
Texas Association of



®
REALTORS
headquartered in Austin, represents over
50,000 members statewide involved in all
aspects of the real estate industry.
www.Texasrealtors.com
1115 San Jacinto Blvd., Ste. 200
Austin, TX 78701-1906
©OnCourse Learning. All Rights Reserved.
Code of Ethics

www.Realtor.org
©OnCourse Learning. All Rights Reserved.
Key Terms





Broker
Independent
contractor
License revocation
License suspension
Licensee





REALTOR®
Recovery fund
Sales associate
Salesperson
TREC
©OnCourse Learning. All Rights Reserved.