Texas Contracts & Agency·Tx Nar Settlement Implementation

NAR Settlement — Texas Implementation

Exam: Real Estate Salesperson — Texas Chapter: Ch7 — Texas TREC Licensing and Agency Effective: August 17, 2024 (national); reflected in TREC 01/2026 Pearson VUE content outline

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Overview

The National Association of REALTORS® (NAR) settlement, effective August 17, 2024, changed how buyer-agent compensation works nationally. Texas TREC has incorporated the buyer agreement requirement into its updated content outline. This topic is tested on the current TX state exam.

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Key Rule Changes (Effective August 17, 2024)

1. Written Buyer-Broker Agreements Required Before Touring

  • Agents must have a written buyer representation agreement in place before showing any property to a buyer
  • This applies to home tours (in-person or virtual)
  • An agent cannot show a home to a buyer and then get the agreement signed after the fact
  • The agreement must specify the buyer's agent's compensation

    • 2. MLS Offers of Buyer-Agent Compensation Prohibited

  • Listing agents may no longer post offers of buyer-agent compensation on the MLS
  • The MLS field for buyer-agent compensation has been eliminated
  • This rule applies to all MLS systems nationwide, including all Texas MLS boards

    • 3. Sellers Can Still Pay Buyer's Agent — Off-MLS

  • Sellers can agree to pay the buyer's agent as part of the purchase negotiation
  • This compensation is now negotiated off-MLS — typically addressed in the purchase contract or a separate addendum
  • Sellers are NOT prohibited from offering to pay buyer's agent compensation; they simply cannot advertise it on the MLS

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    Texas TREC Compliance

  • TREC updated the 01/2026 Pearson VUE content outline (document #094401) to reflect buyer agreement requirements
  • Texas law (through TREC licensing rules) already required written buyer representation agreements to establish agency; the NAR Settlement reinforced and formalized the timing requirement (before touring)
  • The TREC Buyer Representation Agreement must specify compensation — including seller-paid comp negotiated off-MLS

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    What This Means for the Exam

    > Exam Tip: Know that MLS compensation offers are prohibited as of August 17, 2024 — but sellers can still agree to pay the buyer's agent as part of the purchase negotiation, negotiated off-MLS. These are two distinct facts that are commonly confused.

    | Statement | True or False? | |---|---| | Sellers can offer to pay buyer's agent compensation | TRUE — just not via MLS | | MLS offers of buyer-agent compensation are prohibited | TRUE | | Written buyer agreements must be signed before touring | TRUE | | Sellers are required to pay the buyer's agent | FALSE — it is negotiable | | The NAR Settlement applies in Texas | TRUE — it is a national rule |

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    Related Content

  • See TX-TREC-Form-Changes-Jan2025.md for January 3, 2025 form changes (also exam-tested)
  • TREC topic area: Agency relationships, buyer representation, brokerage compensation

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Tags: #RealEstate #Texas #Ch7 #NARSettlement #BuyerAgreement #MLSCompensation #BuyerBroker #TREC #AgentCompensation #August2024