Texas Register Preamble
The Texas Real Estate Commission (TREC) adopts amendments to 22 TAC §535.148, Receiving an Undisclosed Commission or Rebate in Chapter 535, General Provisions, without changes to the proposed text as published in the May 24, 2019, issue of the Texas Register (44 TexReg 2577) and will not be republished.
The amendments provide clarity about consumer protection issues when paying or receiving funds to/from other settlement service providers.
A section was added to define settlement providers that mostly parallels the definition in the Real Estate Settlement Procedures Act (RESPA) for consistency with the federal law. Exemptions from the prohibition provisions were also clarified. TREC currently has a rule that includes these provisions for inspectors but not explicitly for other real estate license holders. The change provides parity for license types subject to TREC's jurisdiction and ensures settlement provider independence. These amendments prohibit license holders from selling referrals or recommending settlement providers to their clients based solely on money or other valuable consideration received in order to ensure that license holders are upholding their fiduciary duty by putting their clients' interest above their own financial gain.
Two comments were received on the amendments as published. Each comment addressed the need for change to current practices and neither requested changes to the proposed rule. As such, the Commission declined to make changes.
The amendments are adopted under Texas Occupations Code §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102.
Next Page Previous Page