Contents
The TREC One to Four Family Residential Contract Form serves as a crucial document in real estate transactions involving single-family homes and multifamily properties with up to four units. This standardized form, developed by the Texas Real Estate Commission, outlines the essential terms and conditions agreed upon by buyers and sellers. Key components include the purchase price, financing details, and property description, which ensure clarity and mutual understanding between the parties involved. Additionally, the contract addresses important contingencies, such as inspections and financing approvals, providing a framework for potential negotiations. Furthermore, it specifies the responsibilities of both the buyer and seller regarding closing costs, possession dates, and repairs, thereby facilitating a smoother transaction process. By utilizing this form, individuals can navigate the complexities of real estate agreements with greater confidence and security.
Preview - TREC One to four family residential contract Form
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page of 11 11-04-2024
(Address of Property)
PROMULGATED BY THE TEXAS REAL ESTATE COMMISSION (TREC)
ONE TO FOUR FAMILY RESIDENTIAL CONTRACT (RESALE)
NOTICE: Not For Use For Condominium Transactions
1. PARTIES: The parties to this contract are
(Seller) and (Buyer).
Seller agrees to sell and convey to Buyer and Buyer agrees to buy from Seller the Property defined
below.
2. PROPERTY: The land, improvements and accessories are collectively referred to as the Property
(Property).
A. LAND: Lot Block ,
Addition, City of , County of ,
Texas, known as
(address/zip code), or as described on attached exhibit.
B. IMPROVEMENTS: The house, garage and all other fixtures and improvements attached to the
above-described real property, including without limitation, the following permanently
installed and built-in items, if any: all equipment and appliances, valances, screens,
shutters, awnings, wall-to-wall carpeting, mirrors, ceiling fans, attic fans, mail boxes, television
antennas, mounts and brackets for televisions and speakers, heating and air-conditioning units,
security and fire detection equipment, wiring, plumbing and lighting fixtures, chandeliers, water
softener system, kitchen equipment, garage door openers, cleaning equipment, shrubbery,
landscaping, outdoor cooking equipment, and all other property attached to the above
described real property.
C. ACCESSORIES: The following described related accessories, if any: window air conditioning
units, stove, fireplace screens, curtains and rods, blinds, window shades, draperies and rods,
door keys, mailbox keys, above ground pool, swimming pool equipment and maintenance
accessories, artificial fireplace logs, security systems that are not fixtures, and controls for: (i)
garage doors, (ii) entry gates, and (iii) other improvements and accessories. “Controls” includes
Seller’s transferable rights to the (i) software and applications used to access and control
improvements or accessories, and (ii) hardware used solely to control improvements or
accessories.
D. EXCLUSIONS: The following improvements and accessories will be retained by Seller and
must be removed prior to delivery of possession:
.
E. RESERVATIONS: Any reservation for oil, gas, or other minerals, water, timber, or other
interests is made in accordance with an attached addendum.
3. SALES PRICE:
A. Cash portion of Sales Price payable by Buyer at closing ........................... $
The term “Cash portion of the Sales Price” does not include proceeds from borrowing of any
kind or selling other real property except as disclosed in this contract.
B. Sum of all financing described in the attached: q Third Party Financing Addendum,
q Loan Assumption Addendum, q Seller Financing Addendum .......... $
C. Sales Price (Sum of A and B) ............................................................... $
4. LEASES: Except as disclosed in this contract, Seller is not aware of any leases affecting the
Property. After the Effective Date, Seller may not, without Buyer's written consent, create a new
lease, amend any existing lease, or convey any interest in the Property. (Check all applicable
boxes)
q A. RESIDENTIAL LEASES: The Property is subject to one or more residential leases and the
Addendum Regarding Residential Leases is attached to this contract.
q B. FIXTURE LEASES: Fixtures on the Property are subject to one or more fixture leases (for
example, solar panels, propane tanks, water softener, security system) and the Addendum
Regarding Fixture Leases is attached to this contract.
q C. NATURAL RESOURCE LEASES: “Natural Resource Lease” means an existing oil and gas,
mineral, geothermal, water, wind, or other natural resource lease affecting the Property to
which Seller is a party.
q (1) Seller has delivered to Buyer a copy of all the Natural Resource Leases.
q (2) Seller has not delivered to Buyer a copy of all the Natural Resource Leases. Seller shall
provide to Buyer a copy of all the Natural Resource Leases within 3 days after the Effective
Date. Buyer may terminate the contract within _____ days after the date the Buyer
receives all the Natural Resource Leases and the earnest money shall be refunded to
Buyer.
EQUAL HOUSING
OPPORTUNITY
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 2 of 11 11-04-2024
(Address of Property)
5. EARNEST MONEY AND TERMINATION OPTION:
A. DELIVERY OF EARNEST MONEY AND OPTION FEE: Within 3 days after the Effective Date, Buyer
must deliver to (Escrow Agent) at
(address): $ as earnest money and $
as the Option Fee. The earnest money and Option Fee shall be made payable to Escrow Agent
and may be paid separately or combined in a single payment.
(1) Buyer shall deliver additional earnest money of $ to Escrow Agent within
days after the Effective Date of this contract.
(2) If the last day to deliver the earnest money, Option Fee, or the additional earnest money
falls on a Saturday, Sunday, or legal holiday, the time to deliver the earnest money, Option
Fee, or the additional earnest money, as applicable, is extended until the end of the next day
that is not a Saturday, Sunday, or legal holiday.
(3) The amount(s) Escrow Agent receives under this paragraph shall be applied first to the
Option Fee, then to the earnest money, and then to the additional earnest money.
(4) Buyer authorizes Escrow Agent to release and deliver the Option Fee to Seller at any time
without further notice to or consent from Buyer, and releases Escrow Agent from liability for
delivery of the Option Fee to Seller. The Option Fee will be credited to the Sales Price at
closing.
B. TERMINATION OPTION: For nominal consideration, the receipt of which Seller acknowledges,
and Buyer's agreement to pay the Option Fee within the time required, Seller grants Buyer the
unrestricted right to terminate this contract by giving notice of termination to Seller within
days after the Effective Date of this contract (Option Period). Notices under this
paragraph must be given by 5:00 p.m. (local time where the Property is located) by the date
specified. If Buyer gives notice of termination within the time prescribed: (i) the Option Fee will
not be refunded and Escrow Agent shall release any Option Fee remaining with Escrow Agent to
Seller; and (ii) any earnest money will be refunded to Buyer.
C. FAILURE TO TIMELY DELIVER EARNEST MONEY: If Buyer fails to deliver the earnest money
within the time required, Seller may terminate this contract or exercise Seller’s remedies under
Paragraph 15, or both, by providing notice to Buyer before Buyer delivers the earnest money.
D. FAILURE TO TIMELY DELIVER OPTION FEE: If no dollar amount is stated as the Option Fee or if
Buyer fails to deliver the Option Fee within the time required, Buyer shall not have the
unrestricted right to terminate this contract under this paragraph 5.
E. TIME: Time is of the essence for this paragraph and strict compliance with the time for
performance is required.
6. TITLE POLICY AND SURVEY:
A. TITLE POLICY: Seller shall furnish to Buyer at q Seller’s q Buyer’s expense an owner policy of
title insurance (Title Policy) issued by (Title Company)
in the amount of the Sales Price, dated at or after closing, insuring Buyer against loss under the
provisions of the Title Policy, subject to the promulgated exclusions (including existing building
and zoning ordinances) and the following exceptions:
(1) Restrictive covenants common to the platted subdivision in which the Property is located.
(2) The standard printed exception for standby fees, taxes and assessments.
(3) Liens created as part of the financing described in Paragraph 3.
(4) Utility easements created by the dedication deed or plat of the subdivision in which the
Property is located.
(5) Reservations or exceptions otherwise permitted by this contract or as may be approved by
Buyer in writing.
(6) The standard printed exception as to marital rights.
(7) The standard printed exception as to waters, tidelands, beaches, streams, and related
matters.
(8) The standard printed exception as to discrepancies, conflicts, shortages in area or boundary
lines, encroachments or protrusions, or overlapping improvements:
q (i) will not be amended or deleted from the title policy; or
q (ii) will be amended to read, "shortages in area" at the expense of q Buyer q Seller.
(9) The exception or exclusion regarding minerals approved by the Texas Department of
Insurance.
B. COMMITMENT: Within 20 days after the Title Company receives a copy of this contract, Seller
shall furnish to Buyer a commitment for title insurance (Commitment) and, at Buyer's expense,
legible copies of restrictive covenants and documents evidencing exceptions in the Commitment
(Exception Documents) other than the standard printed exceptions. Seller authorizes the Title
Company to deliver the Commitment and Exception Documents to Buyer at Buyer's address
shown in Paragraph 21. If the Commitment and Exception Documents are not delivered to
Buyer within the specified time, the time for delivery will be automatically extended up to 15
days or 3 days before the Closing Date, whichever is earlier. If the Commitment and Exception
Documents are not delivered within the time required, Buyer may terminate this contract and
the earnest money will be refunded to Buyer.
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 3 of 11 11-04-2024
(Address of Property)
C. SURVEY: The survey must be made by a registered professional land surveyor acceptable to the
Title Company and Buyer’s lender(s). (Check one box only)
q (1) Within days after the Effective Date of this contract, Seller shall furnish to Buyer and
Title Company Seller's existing survey of the Property and a Residential Real Property
Affidavit or Declaration promulgated by the Texas Department of Insurance (T-47 Affidavit
or T-47.1 Declaration). Buyer shall obtain a new survey at Seller's expense no later than 3
days prior to Closing Date if Seller fails to furnish within the time prescribed both the: (i)
existing survey; and (ii) affidavit or declaration. If the Title Company or Buyer’s lender
does not accept the existing survey, or the affidavit or declaration, Buyer shall obtain a new
survey at q Seller's q Buyer's expense no later than 3 days prior to Closing Date.
q (2) Within days after the Effective Date of this contract, Buyer may obtain a new survey
at Buyer's expense. Buyer is deemed to receive the survey on the date of actual receipt or
the date specified in this paragraph, whichever is earlier. If Buyer fails to obtain the survey,
Buyer may not terminate the contract under Paragraph 2B of the Third Party Financing
Addendum because the survey was not obtained.
q(3) Within days after the Effective Date of this contract, Seller, at Seller's expense shall
furnish a new survey to Buyer.
D. OBJECTIONS: Buyer may object in writing to defects, exceptions, or encumbrances to title:
disclosed on the survey other than items 6A(1) through (7) above; disclosed in the
Commitment other than items 6A(1) through (9) above; or which prohibit the following use or
activity: .
Buyer must object the earlier of (i) the Closing Date or (ii) days after Buyer receives the
Commitment, Exception Documents, and the survey. Buyer’s failure to object within the time
allowed will constitute a waiver of Buyer’s right to object; except that the requirements in
Schedule C of the Commitment are not waived by Buyer. Provided Seller is not obligated to
incur any expense, Seller shall cure any timely objections of Buyer or any third party lender
within 15 days after Seller receives the objections (Cure Period) and the Closing Date will be
extended as necessary. If objections are not cured within the Cure Period, Buyer may, by
delivering notice to Seller within 5 days after the end of the Cure Period: (i) terminate this
contract and the earnest money will be refunded to Buyer; or (ii) waive the objections. If
Buyer does not terminate within the time required, Buyer shall be deemed to have waived the
objections. If the Commitment or survey is revised or any new Exception Document(s) is
delivered, Buyer may object to any new matter revealed in the revised Commitment or survey
or new Exception Document(s) within the same time stated in this paragraph to make
objections beginning when the revised Commitment, survey, or Exception Document(s) is
delivered to Buyer.
E. TITLE NOTICES:
(1) ABSTRACT OR TITLE POLICY: Broker advises Buyer to have an abstract of title covering the
Property examined by an attorney of Buyer’s selection, or Buyer should be furnished with or
obtain a Title Policy. If a Title Policy is furnished, the Commitment should be promptly
reviewed by an attorney of Buyer’s choice due to the time limitations on Buyer’s right to
object.
(2) MEMBERSHIP IN PROPERTY OWNERS ASSOCIATION(S): The Property qis qis not subject
to mandatory membership in a property owners association(s). If the Property is subject to
mandatory membership in a property owners association(s), Seller notifies Buyer under
§5.012, Texas Property Code, that, as a purchaser of property in the residential community
identified in Paragraph 2A in which the Property is located, you are obligated to be a
member of the property owners association(s). Restrictive covenants governing the use and
occupancy of the Property and all dedicatory instruments governing the establishment,
maintenance, or operation of this residential community have been or will be recorded in
the Real Property Records of the county in which the Property is located. Copies of the
restrictive covenants and dedicatory instruments may be obtained from the county clerk.
You are obligated to pay assessments to the property owners association(s). The
amount of the assessments is subject to change. Your failure to pay the
assessments could result in enforcement of the association’s lien on and the
foreclosure of the Property.
Section 207.003, Property Code, entitles an owner to receive copies of any document that
governs the establishment, maintenance, or operation of a subdivision, including, but not
limited to, restrictions, bylaws, rules and regulations, and a resale certificate from a
property owners' association. A resale certificate contains information including, but not
limited to, statements specifying the amount and frequency of regular assessments and the
style and cause number of lawsuits to which the property owners' association is a party,
other than lawsuits relating to unpaid ad valorem taxes of an individual member of the
association. These documents must be made available to you by the property owners'
association or the association's agent on your request. If Buyer is concerned about
these matters, the TREC promulgated Addendum for Property Subject to
Mandatory Membership in a Property Owners Association(s) should be used.
(3) STATUTORY TAX DISTRICTS: If the Property is situated in a utility or other statutorily
created district providing water, sewer, drainage, or flood control facilities and services,
Chapter 49, Texas Water Code, requires Seller to deliver and Buyer to sign the statutory
notice relating to the tax rate, bonded indebtedness, or standby fee of the district prior to
final execution of this contract.
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 4 of 11 11-04-2024
(Address of Property)
(4) TIDE WATERS: If the Property abuts the tidally influenced waters of the state, §33.135,
Texas Natural Resources Code, requires a notice regarding coastal area property to be
included in the contract. An addendum containing the notice promulgated by TREC or
required by the parties must be used.
(5) ANNEXATION: If the Property is located outside the limits of a municipality, Seller notifies
Buyer under §5.011, Texas Property Code, that the Property may now or later be included in
the extraterritorial jurisdiction of a municipality and may now or later be subject to
annexation by the municipality. Each municipality maintains a map that depicts its
boundaries and extraterritorial jurisdiction. To determine if the Property is located within a
municipality’s extraterritorial jurisdiction or is likely to be located within a municipality’s
extraterritorial jurisdiction, contact all municipalities located in the general proximity of the
Property for further information.
(6) PROPERTY LOCATED IN A CERTIFICATED SERVICE AREA OF A UTILITY SERVICE PROVIDER:
Notice required by §13.257, Water Code: The real property, described in Paragraph 2, that
you are about to purchase may be located in a certificated water or sewer service area,
which is authorized by law to provide water or sewer service to the properties in the
certificated area. If your property is located in a certificated area there may be special costs
or charges that you will be required to pay before you can receive water or sewer service.
There may be a period required to construct lines or other facilities necessary to provide
water or sewer service to your property. You are advised to determine if the property is in a
certificated area and contact the utility service provider to determine the cost that you will
be required to pay and the period, if any, that is required to provide water or sewer service
to your property. The undersigned Buyer hereby acknowledges receipt of the foregoing
notice at or before the execution of a binding contract for the purchase of the real property
described in Paragraph 2 or at closing of purchase of the real property.
(7) PUBLIC IMPROVEMENT DISTRICTS: If the Property is in a public improvement district, Seller
must give Buyer written notice as required by §5.014, Property Code. An addendum
containing the required notice shall be attached to this contract.
(8) TRANSFER FEES: If the Property is subject to a private transfer fee obligation, §5.205,
Property Code, requires Seller to notify Buyer as follows: The private transfer fee obligation
may be governed by Chapter 5, Subchapter G of the Texas Property Code.
(9) PROPANE GAS SYSTEM SERVICE AREA: If the Property is located in a propane gas system
service area owned by a distribution system retailer, Seller must give Buyer written notice
as required by §141.010, Texas Utilities Code. An addendum containing the notice approved
by TREC or required by the parties should be used.
(10) NOTICE OF WATER LEVEL FLUCTUATIONS: If the Property adjoins an impoundment of
water, including a reservoir or lake, constructed and maintained under Chapter 11, Water
Code, that has a storage capacity of at least 5,000 acre-feet at the impoundment’s normal
operating level, Seller hereby notifies Buyer: “The water level of the impoundment of water
adjoining the Property fluctuates for various reasons, including as a result of: (1) an entity
lawfully exercising its right to use the water stored in the impoundment; or (2) drought or
flood conditions.”
(11) CERTIFICATE OF MOLD REMEDIATION: If the Property has been remediated for mold, Seller
must provide to Buyer each certificate of mold damage remediation issued under
§1958.154, Occupations Code, during the 5 years preceding the sale of the Property.
(12) REQUIRED NOTICES: The following notices have been given or are attached to this
contract (for example, utility, water, drainage, and public improvement districts):
.
Seller’s failure to provide applicable statutory notices may provide Buyer with remedies or
rights to terminate the contract.
7. PROPERTY CONDITION:
A. ACCESS, INSPECTIONS AND UTILITIES: Seller shall permit Buyer and Buyer’s agents access
to the Property at reasonable times. Buyer may have the Property inspected by inspectors
selected by Buyer and licensed by TREC or otherwise permitted by law to make inspections.
Any hydrostatic testing must be separately authorized by Seller in writing. Seller at Seller's
expense shall immediately cause existing utilities to be turned on and shall keep the utilities
on during the time this contract is in effect.
B. SELLER'S DISCLOSURE NOTICE PURSUANT TO §5.008, TEXAS PROPERTY CODE (Notice):
(Check one box only)
q (1) Buyer has received the Notice.
q (2) Buyer has not received the Notice. Within days after the Effective Date of this
contract, Seller shall deliver the Notice to Buyer. If Buyer does not receive the Notice,
Buyer may terminate this contract at any time prior to the closing and the earnest money
will be refunded to Buyer. If Seller delivers the Notice, Buyer may terminate this contract
for any reason within 7 days after Buyer receives the Notice or prior to the closing,
whichever first occurs, and the earnest money will be refunded to Buyer.
q (3) The Seller is not required to furnish the notice under the Texas Property Code.
C. SELLER’S DISCLOSURE OF LEAD-BASED PAINT AND LEAD-BASED PAINT HAZARDS is required
by Federal law for a residential dwelling constructed prior to 1978.
D. ACCEPTANCE OF PROPERTY CONDITION: “As Is” means the present condition of the Property
with any and all defects and without warranty except for the warranties of title and the
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 5 of 11 11-04-2024
(Address of Property)
warranties in this contract. Buyer’s agreement to accept the Property As Is under Paragraph
7D(1) or (2) does not preclude Buyer from inspecting the Property under Paragraph 7A, from
negotiating repairs or treatments in a subsequent amendment, or from terminating this
contract during the Option Period, if any.
(Check one box only)
q (1) Buyer accepts the Property As Is.
q (2) Buyer accepts the Property As Is provided Seller, at Seller’s expense, shall complete the
following specific repairs and treatments:
(Do not insert general phrases, such as “subject to inspections” that do not identify specific
repairs and treatments.)
E. LENDER REQUIRED REPAIRS AND TREATMENTS: Unless otherwise agreed in writing, neither
party is obligated to pay for lender required repairs, which includes treatment for wood
destroying insects. If the parties do not agree to pay for the lender required repairs or
treatments, this contract will terminate and the earnest money will be refunded to Buyer. If
the cost of lender required repairs and treatments exceeds 5% of the Sales Price, Buyer may
terminate this contract and the earnest money will be refunded to Buyer.
F. COMPLETION OF REPAIRS AND TREATMENTS: Unless otherwise agreed in writing, Seller shall
complete all agreed repairs and treatments prior to the Closing Date and obtain any required
permits. The repairs and treatments must be performed by persons who are licensed to
provide such repairs or treatments or, if no license is required by law, are commercially
engaged in the trade of providing such repairs or treatments. Seller shall: (i) provide Buyer
with copies of documentation from the repair person(s) showing the scope of work and
payment for the work completed; and (ii) at Seller’s expense, arrange for the transfer of any
transferable warranties with respect to the repairs and treatments to Buyer at closing. If Seller
fails to complete any agreed repairs and treatments prior to the Closing Date, Buyer may
exercise remedies under Paragraph 15 or extend the Closing Date up to 5 days if necessary for
Seller to complete the repairs and treatments.
G. ENVIRONMENTAL MATTERS: Buyer is advised that the presence of wetlands, toxic substances,
including asbestos and wastes or other environmental hazards, or the presence of a
threatened or endangered species or its habitat may affect Buyer’s intended use of the
Property. If Buyer is concerned about these matters, an addendum promulgated by TREC or
required by the parties should be used.
H. RESIDENTIAL SERVICE CONTRACTS: Buyer may purchase a residential service contract from a
provider or administrator licensed by the Texas Department of Licensing and Regulation. If
Buyer purchases a residential service contract, Seller shall reimburse Buyer at closing for the
cost of the residential service contract in an amount not exceeding $ . Buyer
should review any residential service contract for the scope of coverage, exclusions and
limitations. The purchase of a residential service contract is optional. Similar coverage
may be purchased from various companies authorized to do business in Texas.
8. BROKERS AND SALES AGENTS:
A. BROKER OR SALES AGENT DISCLOSURE: Texas law requires a real estate broker or sales
agent who is a party to a transaction or acting on behalf of a spouse, parent, child, business
entity in which the broker or sales agent owns more than 10%, or a trust for which the broker
or sales agent acts as a trustee or of which the broker or sales agent or the broker or sales
agent’s spouse, parent or child is a beneficiary, to notify the other party in writing before
entering into a contract of sale. Disclose if applicable:
.
B. BROKERS’ FEES: All obligations of the parties for payment of brokers’ fees are contained in
separate written agreements.
9. CLOSING:
A. The closing of the sale will be on or before , 20 , or within 7 days
after objections made under Paragraph 6D have been cured or waived, whichever date is later
(Closing Date). If either party fails to close the sale by the Closing Date, the non-defaulting
party may exercise the remedies contained in Paragraph 15.
B. At closing:
(1) Seller shall execute and deliver a general warranty deed conveying title to the Property to
Buyer and showing no additional exceptions to those permitted in Paragraph 6 and furnish
tax statements or certificates showing no delinquent taxes on the Property.
(2) Buyer shall pay the Sales Price in good funds acceptable to the Escrow Agent.
(3) Seller and Buyer shall execute and deliver any notices, statements, certificates, affidavits,
releases, loan documents, transfer of any warranties, and other documents reasonably
required for the closing of the sale and the issuance of the Title Policy.
(4) There will be no liens, assessments, or security interests against the Property which will
not be satisfied out of the sales proceeds unless securing the payment of any loans
assumed by Buyer and assumed loans will not be in default.
(5) Private transfer fees (as defined by Chapter 5, Subchapter G of the Texas Property Code)
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 6 of 11 11-04-2024
(Address of Property)
will be the obligation of Seller unless provided otherwise in this contract. Transfer fees
assessed by a property owners’ association are governed by the Addendum for Property
Subject to Mandatory Membership in a Property Owners Association.
10. POSSESSION:
A. BUYER’S POSSESSION: Seller shall deliver to Buyer possession of the Property in its present or
required condition, ordinary wear and tear excepted: qupon closing and funding qaccording
to a temporary residential lease form promulgated by TREC or other written lease required by
the parties. Any possession by Buyer prior to closing or by Seller after closing which is not
authorized by a written lease will establish a tenancy at sufferance relationship between the
parties. Consult your insurance agent prior to change of ownership and possession
because insurance coverage may be limited or terminated. The absence of a written
lease or appropriate insurance coverage may expose the parties to economic loss.
B. SMART DEVICES: “Smart Device” means a device that connects to the internet to enable
remote use, monitoring, and management of: (i) the Property; (ii) items identified in any Non-
Realty Items Addendum; or (iii) items in a Fixture Lease assigned to Buyer. At the time Seller
delivers possession of the Property to Buyer, Seller shall:
(1) deliver to Buyer written information containing all access codes, usernames, passwords,
and applications Buyer will need to access, operate, manage, and control the Smart
Devices; and
(2) terminate and remove all access and connections to the improvements and accessories
from any of Seller’s personal devices including but not limited to phones and computers.
11. SPECIAL PROVISIONS: (This paragraph is intended to be used only for additional informational
items. An informational item is a statement that completes a blank in a contract form, discloses
factual information, or provides instructions. Real estate brokers and sales agents are prohibited
from practicing law and shall not add to, delete, or modify any provision of this contract unless
drafted by a party to this contract or a party's attorney.)
.
12. SETTLEMENT AND OTHER EXPENSES:
A. The following expenses must be paid at or prior to closing:
(1) Seller shall pay the following expenses (Seller's Expenses):
(a) releases of existing liens, including prepayment penalties and recording fees; release of
Seller’s loan liability; tax statements or certificates; preparation of deed; one-half of
escrow fee; brokerage fees that Seller has agreed to pay; and other expenses payable
by Seller under this contract;
(b) the following amount to be applied to brokerage fees that Buyer has agreed to pay:
q$ or q _____% of the Sales Price (check one box only); and
(c) an amount not to exceed $ to be applied to other Buyer’s Expenses.
(2) Buyer shall pay the following expenses (Buyer's Expenses): Appraisal fees; loan application
fees; origination charges; credit reports; preparation of loan documents; interest on the
notes from date of disbursement to one month prior to dates of first monthly payments;
recording fees; copies of easements and restrictions; loan title policy with endorsements
required by lender; loan-related inspection fees; photos; amortization schedules; one-half
of escrow fee; all prepaid items, including required premiums for flood and hazard
insurance, reserve deposits for insurance, ad valorem taxes and special governmental
assessments; final compliance inspection; courier fee; repair inspection; underwriting fee;
wire transfer fee; expenses incident to any loan; Private Mortgage Insurance Premium
(PMI), VA Loan Funding Fee, or FHA Mortgage Insurance Premium (MIP) as required by the
lender; brokerage fees that Buyer has agreed to pay; and other expenses payable by Buyer
under this contract.
B. If any expense exceeds an amount expressly stated in this contract for such expense to be
paid by a party, that party may terminate this contract unless the other party agrees to pay
such excess. Buyer may not pay charges and fees expressly prohibited by FHA, VA, Texas
Veterans Land Board or other governmental loan program regulations.
13. PRORATIONS: Taxes for the current year, interest, rents, and regular periodic maintenance
fees, assessments, and dues (including prepaid items) will be prorated through the Closing Date.
The tax proration may be calculated taking into consideration any change in exemptions that will affect the
current year's taxes. If taxes for the current year vary from the amount prorated at closing, the parties shall
adjust the prorations when tax statements for the current year are available. If taxes are not paid at or prior to
closing, Buyer shall pay taxes for the current year.
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 7 of 11 11-04-2024
(Address of Property)
14. CASUALTY LOSS: If any part of the Property is damaged or destroyed by fire or other casualty
after the Effective Date of this contract, Seller shall restore the Property to its previous condition
as soon as reasonably possible, but in any event by the Closing Date. If Seller fails to do so due to
factors beyond Seller’s control, Buyer may (a) terminate this contract and the earnest money will
be refunded to Buyer (b) extend the time for performance up to 15 days and the Closing Date will
be extended as necessary or (c) accept the Property in its damaged condition with an assignment
of insurance proceeds, if permitted by Seller’s insurance carrier, and receive credit from Seller at
closing in the amount of the deductible under the insurance policy. Seller’s obligations under this
paragraph are independent of any other obligations of Seller under this contract.
15. DEFAULT: If Buyer fails to comply with this contract, Buyer will be in default, and Seller may (a)
enforce specific performance, seek such other relief as may be provided by law, or both, or (b)
terminate this contract and receive the earnest money as liquidated damages, thereby releasing
both parties from this contract. If Seller fails to comply with this contract, Seller will be in default
and Buyer may (a) enforce specific performance, seek such other relief as may be provided by
law, or both, or (b) terminate this contract and receive the earnest money, thereby releasing both
parties from this contract.
16. MEDIATION: It is the policy of the State of Texas to encourage resolution of disputes through
alternative dispute resolution procedures such as mediation. Any dispute between Seller and
Buyer related to this contract which is not resolved through informal discussion will be
submitted to a mutually acceptable mediation service or provider. The parties to the mediation
shall bear the mediation costs equally. This paragraph does not preclude a party from seeking
equitable relief from a court of competent jurisdiction.
17. ATTORNEY'S FEES: A Buyer, Seller, Listing Broker, Other Broker, or Escrow Agent who prevails
in any legal proceeding related to this contract is entitled to recover reasonable attorney’s fees
and all costs of such proceeding.
18. ESCROW:
A. ESCROW: The Escrow Agent is not (i) a party to this contract and does not have liability for the
performance or nonperformance of any party to this contract, (ii) liable for interest on the
earnest money and (iii) liable for the loss of any earnest money caused by the failure of any
financial institution in which the earnest money has been deposited unless the financial
institution is acting as Escrow Agent. Escrow Agent may require any disbursement made in
connection with this contract to be conditioned on Escrow Agent’s collection of good funds
acceptable to Escrow Agent.
B. EXPENSES: At closing, the earnest money must be applied first to any cash down payment,
then to Buyer's Expenses and any excess refunded to Buyer. If no closing occurs, Escrow Agent
may: (i) require a written release of liability of the Escrow Agent from all parties before
releasing any earnest money; and (ii) require payment of unpaid expenses incurred on behalf
of a party. Escrow Agent may deduct authorized expenses from the earnest money payable to a
party. “Authorized expenses” means expenses incurred by Escrow Agent on behalf of the party
entitled to the earnest money that were authorized by this contract or that party.
C. DEMAND: Upon termination of this contract, either party or the Escrow Agent may send a
release of earnest money to each party and the parties shall execute counterparts of the
release and deliver same to the Escrow Agent. If either party fails to execute the release, either
party may make a written demand to the Escrow Agent for the earnest money. If only one
party makes written demand for the earnest money, Escrow Agent shall promptly provide a
copy of the demand to the other party. If Escrow Agent does not receive written objection to
the demand from the other party within 15 days, Escrow Agent may disburse the earnest
money to the party making demand reduced by the amount of unpaid expenses incurred on
behalf of the party receiving the earnest money and Escrow Agent may pay the same to the
creditors. If Escrow Agent complies with the provisions of this paragraph, each party hereby
releases Escrow Agent from all adverse claims related to the disbursal of the earnest money.
D. DAMAGES: Any party who wrongfully fails or refuses to sign a release acceptable to the Escrow
Agent within 7 days of receipt of the request will be liable to the other party for (i) damages;
(ii) the earnest money; (iii) reasonable attorney's fees; and (iv) all costs of suit.
E. NOTICES: Escrow Agent’s notices will be effective when sent in compliance with Paragraph 21.
Notice of objection to the demand will be deemed effective upon receipt by Escrow Agent.
19. REPRESENTATIONS: All covenants, representations and warranties in this contract survive
closing. If any representation of Seller in this contract is untrue on the Closing Date, Seller will be
in default. Unless expressly prohibited by written agreement, Seller may continue to show the
Property and receive, negotiate and accept back up offers.
20. FEDERAL REQUIREMENTS: If Seller is a "foreign person,” as defined by Internal Revenue Code
and its regulations, or if Seller fails to deliver an affidavit or a certificate of non-foreign status to
Buyer that Seller is not a "foreign person,” then Buyer shall withhold from the sales proceeds an
amount sufficient to comply with applicable tax law and deliver the same to the Internal Revenue
Service together with appropriate tax forms. Internal Revenue Service regulations require filing
written reports if currency in excess of specified amounts is received in the transaction.
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 8 of 11 11-04-2024
(Address of Property)
q
q
q
q
q
q
q
q
q
q
q
q
Third Party Financing Addendum
Seller Financing Addendum
Addendum for Property Subject to
Mandatory Membership in a Property
Owners Association
Buyer’s Temporary Residential Lease
Loan Assumption Addendum
Addendum for Sale of Other Property by
Buyer
Addendum for Reservation of Oil, Gas
and Other Minerals
Addendum for "Back-Up" Contract
Addendum for Coastal Area Property
Addendum for Authorizing Hydrostatic
Testing
Addendum Concerning Right to
Terminate Due to Lender’s Appraisal
Environmental Assessment, Threatened
or Endangered Species and Wetlands
Addendum
q
q
q
q
q
q
q
q
q
q
Seller’s Temporary Residential Lease
Short Sale Addendum
Addendum for Property Located Seaward
of the Gulf Intracoastal Waterway
Addendum for Seller's Disclosure of
Information on Lead-based Paint and
Lead-based Paint Hazards as Required by
Federal Law
Addendum for Property in a Propane Gas
System Service Area
Addendum Regarding Residential Leases
Addendum Regarding Fixture Leases
Addendum containing Notice of Obligation
to Pay Improvement District Assessment
Addendum for Section 1031 Exchange
Other (list):
22. AGREEMENT OF PARTIES: This contract contains the entire agreement of the parties and
cannot be changed except by their written agreement. Addenda which are a part of this contract
are (Check all applicable boxes):
21. NOTICES: All notices from one party to the other must be in writing and are effective when
mailed to, hand-delivered at, or transmitted by fax or electronic transmission as follows:
23. CONSULT AN ATTORNEY BEFORE SIGNING: TREC rules prohibit real estate brokers and sales
agents from giving legal advice. READ THIS CONTRACT CAREFULLY.
Buyer's
Attorney is:
Seller's
Attorney is:
Phone:
( )
Phone:
( )
Fax:
( )
Fax:
( )
E-mail:
E-mail:
To Buyer at:
To Seller at:
Phone:
( )
Phone:
( )
E-mail/Fax:
E-mail/Fax:
E-mail/Fax:
E-mail/Fax:
With a copy to Buyer’s agent at:
With a copy to Seller’s agent at:
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 9 of 11 11-04-2024
(Address of Property)
EXECUTED the day of , 20 (Effective Date).
(BROKER: FILL IN THE DATE OF FINAL ACCEPTANCE.)
Buyer
Seller
Buyer
Seller
The form of this contract has been approved by the Texas Real Estate Commission. TREC forms are
intended for use only by trained real estate license holders. No representation is made as to the legal
validity or adequacy of any provision in any specific transactions. It is not intended for complex
transactions. Texas Real Estate Commission, P.O. Box 12188, Austin, TX 78711-2188, (512) 936-3000
(http://www.trec.texas.gov) TREC NO. 20-18. This form replaces TREC NO. 20-17.
Initialed for identification by Buyer and Seller TREC NO. 20-18
Contract Concerning Page 10 of 11 11-04-2024
(Address of Property)
BROKER INFORMATION
(Print name(s) only. Do not sign)
Disclosure: Pursuant to a previous, separate agreement, Listing Broker has agreed to pay Other Broker a fee
(q $______________ or q _____% of the Sales Price). This disclosure is for informational purposes and does
not change the previous agreement between brokers to pay or share a commission.
Other Broker Firm License No.
Listing Broker Firm License No.
represents q Buyer only as Buyer’s agent
q Seller as Listing Broker’s subagent
represents q Seller and Buyer as an intermediary
q Seller only as Seller’s agent
Associate’s Name License No.
Listing Associate’s Name License No.
Associate’s Email Address Phone
Listing Associate’s Email Address Phone
Licensed Supervisor of Associate License No.
Licensed Supervisor of Listing Associate License No.
Other Broker's Address Phone
Listing Broker’s Office Address Phone
City State Zip
City State Zip
Selling Associate’s Name License No.
Selling Associate’s Email Address Phone
Licensed Supervisor of Selling Associate License No.
Selling Associate’s Office Address
City State Zip
Team Name
Team Name
Team Name
Document Specifics
| Fact Name | Description |
|---|---|
| Purpose | The TREC One to Four Family Residential Contract is used for the sale of residential properties in Texas. |
| Governing Law | This contract is governed by Texas state law, specifically the Texas Real Estate Commission (TREC) regulations. |
| Parties Involved | The contract involves two primary parties: the seller and the buyer, both of whom must be clearly identified. |
| Key Components | Important elements include the purchase price, financing details, and any contingencies related to the sale. |
| Disclosure Requirements | Sellers must provide necessary disclosures about the property, including any known defects or issues. |
TREC One to four family residential contract: Usage Instruction
Filling out the TREC One to Four Family Residential Contract form is an important step in the home buying or selling process. It is essential to complete the form accurately to ensure all parties understand their rights and obligations. Follow the steps below to fill out the form correctly.
- Begin with the date at the top of the form. Write the date when the contract is being executed.
- Identify the parties involved. Fill in the names of the buyer(s) and seller(s) in the designated spaces.
- Provide the property address. Enter the complete address of the property being bought or sold.
- Specify the sales price. Clearly state the agreed-upon purchase price for the property.
- Detail the earnest money. Indicate the amount of earnest money to be deposited and the name of the escrow agent holding it.
- Outline the financing terms. Include details about how the buyer intends to finance the purchase, such as a loan or cash.
- List any contingencies. Mention any conditions that must be met for the contract to be valid, such as inspections or financing approval.
- Complete the closing details. State the anticipated closing date and any additional terms related to closing.
- Sign and date the form. Ensure all parties sign and date the contract to make it legally binding.
Once the form is completed, it should be reviewed for accuracy. All parties involved should retain a copy for their records. It is advisable to consult with a real estate professional if there are any uncertainties or questions about the process.
Learn More on TREC One to four family residential contract
What is the TREC One to Four Family Residential Contract Form?
The TREC One to Four Family Residential Contract Form is a standardized document used in Texas for the sale of residential properties that contain one to four units. This form is designed to streamline the buying and selling process, ensuring that all necessary legal elements are included. It covers various aspects of the transaction, including the purchase price, financing details, and contingencies. By using this form, both buyers and sellers can have a clear understanding of their rights and obligations.
Who can use the TREC One to Four Family Residential Contract Form?
This form is primarily intended for use by licensed real estate agents and brokers in Texas. However, individuals can also use it if they are comfortable navigating the terms and conditions outlined in the contract. It is crucial for all parties involved in a real estate transaction to understand the implications of the contract and to seek legal advice if necessary. The form is designed to be user-friendly, but having professional guidance can help avoid potential pitfalls.
What are the key components of the contract?
The TREC One to Four Family Residential Contract Form includes several important sections:
- Property Description: This section outlines the specifics of the property being sold, including the address and legal description.
- Sales Price: The agreed-upon price for the property is detailed here, along with any earnest money deposits.
- Financing Terms: This part specifies how the buyer intends to finance the purchase, whether through a loan or cash.
- Contingencies: Buyers can include conditions that must be met before the sale can proceed, such as home inspections or securing financing.
- Closing Information: This section provides details about the closing date and what is required from both parties at that time.
What should I do if I need to make changes to the contract?
If changes are necessary after the contract has been signed, both parties must agree to the modifications. It’s essential to document any changes clearly and have both parties sign off on the revised terms. This can be done through an addendum, which is a separate document that outlines the changes. Always ensure that any modifications are in writing to avoid misunderstandings later on.
Are there any common pitfalls to avoid when using this contract?
Yes, there are several common pitfalls to be aware of:
- Not fully understanding contingencies: Buyers should ensure they understand any contingencies they include, as failing to meet these can jeopardize the sale.
- Missing deadlines: Timely completion of tasks such as inspections and financing is crucial. Missing deadlines can lead to contract termination.
- Assuming verbal agreements are binding: Always put agreements in writing. Verbal agreements may not hold up legally.
- Neglecting to consult a professional: While the form is user-friendly, seeking advice from a real estate professional or attorney can provide valuable insights and help avoid issues.
Common mistakes
Filling out the TREC One to Four Family Residential Contract form can be a straightforward process, but many people make common mistakes that can lead to complications later. One frequent error is failing to include all required information. Buyers and sellers sometimes overlook essential details like the legal description of the property or the correct names of the parties involved. This omission can cause delays or disputes down the line.
Another mistake is not specifying the appropriate terms for financing. Buyers often forget to clarify whether they are using conventional financing, FHA loans, or cash. This lack of clarity can create confusion and might jeopardize the transaction if the lender's requirements are not met.
Additionally, some individuals neglect to address contingencies. Contingencies protect buyers and sellers in various scenarios, such as when a buyer needs to sell their current home before purchasing a new one. Not including these clauses can leave one party vulnerable if unexpected issues arise.
Misunderstanding the earnest money deposit is another common pitfall. Buyers might either underfund or overfund the deposit, not realizing that the amount should reflect the seriousness of their offer while adhering to market standards. An incorrect earnest money amount can raise red flags for sellers.
Lastly, failing to review the contract thoroughly before signing is a critical mistake. Many individuals rush through the process, missing important clauses or terms that could affect their rights and responsibilities. Taking the time to read the entire contract ensures that all parties are aware of their obligations and can prevent misunderstandings in the future.
Documents used along the form
The TREC One to Four Family Residential Contract form is a crucial document in real estate transactions in Texas. However, it is often accompanied by several other forms and documents that help clarify terms, protect interests, and facilitate the sale. Below is a list of common forms used alongside this contract.
- Seller's Disclosure Notice: This document requires the seller to disclose any known issues with the property, such as structural problems or past flooding. It helps buyers make informed decisions.
- Lead-Based Paint Disclosure: For homes built before 1978, this form alerts buyers to the potential presence of lead-based paint. It is a federal requirement to protect buyers from health risks.
- Option Fee and Period Agreement: This document outlines the buyer's right to terminate the contract within a specified period, often in exchange for a fee. It provides flexibility for buyers to conduct inspections.
- Financing Addendum: If the buyer is obtaining a loan, this addendum details the financing terms, including the type of loan and any contingencies related to financing approval.
- Title Commitment: This document, issued by a title company, outlines the terms of the title insurance policy and confirms the property's ownership and any liens against it.
- Property Inspection Report: After an inspection, this report provides an overview of the property's condition, highlighting any necessary repairs or maintenance issues that may affect the sale.
- Home Warranty Agreement: This optional document offers protection for certain home systems and appliances for a specified period after the sale, providing peace of mind to the buyer.
- Closing Disclosure: This form outlines the final terms of the loan, including the total closing costs and the amount the buyer needs to bring to the closing table.
- Deed: The deed is the legal document that transfers ownership of the property from the seller to the buyer. It is essential for completing the transaction.
These documents play important roles in ensuring that both buyers and sellers understand their rights and responsibilities. Having a complete set of forms can streamline the transaction process and help avoid potential disputes.
Similar forms
The TREC One to Four Family Residential Contract is similar to the Purchase Agreement commonly used in real estate transactions. Both documents outline the terms of sale between a buyer and a seller. They include essential details such as the purchase price, property description, and contingencies. While the Purchase Agreement may vary by state, it generally serves the same purpose of formalizing the agreement and protecting the interests of both parties involved.
Another document that resembles the TREC contract is the Lease Agreement. While the TREC contract is primarily for buying and selling properties, the Lease Agreement governs rental situations. Both documents specify the rights and obligations of the parties involved. They include terms related to payment, property maintenance, and duration of the agreement, ensuring clarity in the relationship between landlord and tenant or buyer and seller.
The Exclusive Right to Sell Listing Agreement is another similar document. This agreement is used by real estate agents to secure the right to sell a property on behalf of the owner. Like the TREC contract, it establishes terms such as commission rates and the duration of the agreement. Both documents aim to protect the interests of the parties while facilitating a smooth transaction process.
The Option to Purchase Agreement shares similarities with the TREC contract as well. This document gives a potential buyer the right to purchase a property at a specified price within a certain timeframe. Like the TREC contract, it includes important details about the property and the terms of the sale. This agreement provides flexibility for buyers while ensuring sellers have a commitment from interested parties.
The Seller's Disclosure Notice is another document that complements the TREC contract. It requires sellers to disclose known issues with the property, such as structural problems or environmental hazards. This disclosure is crucial for buyers to make informed decisions. Both documents work together to ensure transparency and protect the interests of the buyer in the transaction.
The Closing Statement, also known as the Settlement Statement, is similar in that it summarizes the financial details of the real estate transaction. This document outlines all costs associated with the sale, including closing costs, taxes, and fees. Like the TREC contract, it provides clarity to both the buyer and seller about the financial obligations involved in the transaction.
The Homeowners Association (HOA) Agreement can also be compared to the TREC contract. If the property is part of an HOA, this agreement outlines the rules and regulations that homeowners must follow. It includes fees and responsibilities for maintenance. Both documents are essential for ensuring that buyers understand their rights and obligations regarding property ownership.
The Addendum for Property Subject to Mandatory Membership in an Owners Association is another related document. This addendum is often attached to the TREC contract when the property is part of an association. It details additional terms related to the association's rules and fees. Both the TREC contract and this addendum ensure that buyers are fully informed about their responsibilities as members of the association.
Finally, the Real Estate Purchase Contract serves a similar function to the TREC contract in various states. This document outlines the terms of a real estate transaction and includes critical information such as purchase price and contingencies. While the specific language may differ, the underlying purpose remains the same: to formalize the agreement between buyer and seller and protect their interests throughout the transaction process.
Dos and Don'ts
When filling out the TREC One to Four Family Residential Contract form, it is essential to approach the process with care. Here are six important guidelines to consider:
- Do read the entire contract thoroughly before filling it out. Understanding the terms and conditions is crucial.
- Do provide accurate and complete information. This includes names, addresses, and any relevant details about the property.
- Do consult with a real estate professional or legal advisor if you have questions. Their expertise can help clarify any uncertainties.
- Do ensure all parties involved sign the contract. An unsigned contract may not be enforceable.
- Don't leave any sections blank. Incomplete forms can lead to misunderstandings or disputes later on.
- Don't rush through the process. Taking your time can prevent costly mistakes and ensure all necessary details are included.
Misconceptions
Many people have misunderstandings about the TREC One to Four Family Residential Contract form. Here are seven common misconceptions and explanations for each:
-
It is only for single-family homes.
This contract can be used for single-family homes, duplexes, triplexes, and fourplexes. It applies to any residential property with up to four units.
-
It is a standard contract that cannot be changed.
While the TREC form provides a solid foundation, parties can negotiate and modify certain terms to fit their needs, as long as both parties agree.
-
All real estate transactions must use this contract.
Not all transactions require this specific form. Some situations may call for different contracts, especially in commercial real estate or unique circumstances.
-
The contract protects the seller more than the buyer.
The TREC contract is designed to be fair to both parties. It includes provisions that protect the interests of buyers as well as sellers.
-
It is a legally binding contract immediately upon signing.
The contract becomes binding only after all parties have signed it and any necessary conditions have been met, such as financing approval.
-
You don’t need a real estate agent to use this contract.
While it is possible to use the contract without an agent, having professional guidance can help ensure that all terms are understood and properly negotiated.
-
Once signed, the terms cannot be changed.
Parties can amend the contract if both agree to the changes. It’s essential to document any modifications in writing.
Understanding these misconceptions can help buyers and sellers navigate the home buying process more effectively.
Key takeaways
When filling out and using the TREC One to Four Family Residential Contract form, it is crucial to pay attention to several key aspects. Understanding these elements can help ensure a smoother transaction process.
- Accuracy is Essential: Every detail on the contract must be filled out accurately. This includes names, property addresses, and all terms of the agreement. Errors can lead to delays or legal complications.
- Understand the Terms: Familiarize yourself with all sections of the contract. Knowing what each term means will help you make informed decisions and avoid misunderstandings.
- Deadlines Matter: The contract includes various deadlines for inspections, financing, and closing. Missing these dates can jeopardize the transaction, so keep a close eye on them.
- Consult Professionals: If you have any questions or uncertainties, don’t hesitate to seek advice from a real estate agent or attorney. Their expertise can be invaluable in navigating the contract effectively.
By keeping these key takeaways in mind, you can approach the TREC One to Four Family Residential Contract with greater confidence and clarity.