New Updates to Buyer Representation Agreement & Amendment

Stay up-to-date with the latest changes to your real estate forms.

Texas REALTORS® has updated the Residential Buyer/Tenant Representation Agreement and the Amendment to Buyer/Tenant Representation Agreement. These new changes, which focus on provisions related to bonuses and other compensation, are now available on texasrealestate.com.

Why the Change? After consulting with NAR legal staff, Texas REALTORS® identified that existing provisions for bonuses and other compensation didn’t meet the “objectively ascertainable” requirement of the NAR settlement. To ensure clarity and compliance, here’s what has changed:

Residential Buyer/Tenant Representation Agreement – Long Form (TXR 1501)

What’s Gone:

• Paragraphs 7E(3) (bonuses) and 7E(4) (other compensation) have been deleted.

What’s New:

• Brokers must now disclose the exact amount of any bonus.
• Clients need to authorize this bonus after knowing the exact amount.
• Authorization can be done by amending the agreement.

Previously, blank lines were used to insert bonus and compensation amounts, which didn’t meet new standards. Now, any compensation must be a specific number or a calculable rate (like a percentage of the sales price). This change ensures adherence to the NAR requirement.

Brokers should discuss potential bonuses with their clients when signing the agreement. If a bonus or other compensation is tied to a property receiving an offer, brokers must use the amendment to get their client’s approval once they know the exact amount.

Amendment to Buyer/Tenant Representation Agreement (TXR 1505)

What’s Added:

• A new Paragraph E allows brokers and their clients to amend the agreement to authorize a bonus.
• There’s also a line to include the address where the bonus applies, as it’s for a specific property.

Stay informed and compliant with these essential updates. For more details, click here.