The Texas Real Estate Commission (TREC) adopts amendments to §537.30, concerning Standard Contract Form TREC No. 23-7, New Home Contract (Incomplete Construction); §537.31, concerning Standard Contract Form TREC No. 24-7, New Home Contract (Completed Construction); §537.41, concerning Standard Contract Form TREC No. 34-3, Addendum for Property Located Seaward of the Gulf Intracoastal Waterway; §537.47, concerning Standard Contract Form TREC No. 40-3, Third Party Financing Condition Addendum; and new §537.50, concerning Standard Contract Form TREC No. 43-0, Addendum Containing Required Notices Under §5.016, §420.001 and §420.002, Texas Property Code. The sections adopt by reference five revised contract forms for use by Texas real estate licensees. Section 537.50 is adopted with changes to the proposed text as published in the October 26, 2007, issue of the Texas Register (32 TexReg 7662) and will be republished. Section 537.50 was corrected to include a reference to §5.016, Texas Property Code, which was omitted in the proposed rule. The form adopted by reference in §537.47, TREC No. 40-3, Third Party Financing Condition Addendum, was changed based on a recommendation from the Broker Lawyer Committee after review of the comments. Sections 537.30, 537.31, and 537.41 are adopted without changes and will not be republished.

Texas real estate licensees are generally required to use forms promulgated by TREC when negotiating contracts for the sale of real property. These forms are drafted by the Broker-Lawyer Committee, an advisory body consisting of six attorneys appointed by the President of the State Bar of Texas, six brokers appointed by TREC, and a public member appointed by the governor.

The adopted amendment to §537.30 adopts by reference Standard Contract Form TREC No. 23-7, New Home Contract (Incomplete Construction). The disclosure on Page 8 of the contract required by §27.007(a), Texas Property Code, is revised because the disclosure was amended by House Bill 3147, 80th Legislature, R.S. (2007).

The adopted amendment to §537.31 adopts by reference Standard Contract Form TREC No. 24-7, New Home Contract (Completed Construction). The revisions adopted are the same as those adopted for Form TREC No. 23-7.

The adopted amendment to §537.41 adopts by reference Standard Contract Form TREC No. 34-3, Addendum for Property Located Seaward of the Gulf Intracoastal Waterway. The addendum was revised to reflect changes that were made to the disclosure under House Bill 2819, 80th Legislature, R.S. (2007).

The adopted amendment to §537.47 adopts by reference Standard Contract Form TREC No. 40-3, Third Party Financing Addendum. On page 2 of the addendum, a reference to having HUD form 92564-CN signed and dated by the buyer was removed as the form no longer has a signature line. Based on written comments and a recommendation from the Broker Lawyer Committee, the title and reference to "Texas Veterans Housing Assistance Program Loan" was changed in paragraph B to "Texas Veterans Loan" because other types of loans are offered by the Texas Veterans Land Board.

The adoption of new §537.50 adopts by reference Standard Contract Form TREC No. 43-0, Addendum Containing Required Notices Under §5.016, §420.001 and §420.002, Texas Property Code. The new addendum contains disclosures required by House Bill 1038, 80th Legislature, R.S. (2007) in cases where the seller may be subject to or exempt from requirements of Title 16, Texas Property Code, regarding registration with the Texas Residential Construction Commission.

The TREC received two comments during the notice and comment period regarding adoption of the amendments or the new rule.

Comment: The Commenters suggested amending paragraph B of Form TREC No. 40-3, Third Party Financing Addendum to indicate that the buyer may have more than one kind of loan from the Texas Veteran's Land Board.

Response: The Commission agrees with the commenters and has revised the form accordingly.

The reasoned justification for the adoption of the amendments and the new rule and the forms adopted by reference is the revision of standard contract forms required for use by real estate licensees to reflect recent changes in law.

The amendments and new section are adopted under Texas Occupations Code, §1101.151, which authorizes TREC to adopt and to enforce rules necessary to administer Chapter 1101.

The statute affected by this adoption is Texas Occupations Code, Chapter 1101. No other statute, code, or article is affected by the adopted rules.