Texas Real Estate Exam Prep

Elements of a contract: Every contract has certain, essential elements that need to be present to be considered valid in a court of law. At the heart of every contract is a promise between two or more persons to do or not do a particular act. Consideration These promises are bound by both parties by what’s called “sufficient consideration.” In the normal parlance of our times, or for the sake of simplicity, we can call it “money.” A simple contractual promise, backed by sufficient consideration could be: I promise to purchase your principal residence for $150,000. Offer & Acceptance Contracts must also consist of a clear offer and acceptance. If an offer is made, but has not been accepted, there can be no contract. Capacity Contracts must be entered into by two adults of sound mind. This doesn’t just mean that you must be free from mental incapacity, it also means that if you enter into a contract while under the influence of drugs or alcohol, you may be deemed incapacitated and the contract may be void. No Duress Contracts must also be entered into freely. If you are signing your name to a contract with a gun to your head, that contract is said to be entered into under duress and may be deemed invalid. While the terms of the duress may not be so dramatic, other signs of duress may be financial or emotional coercion. While contracts can be either oral or written, the law requires that certain contracts be written in order to be enforceable. Contracts for the sale of real property, for example, must be in writing. Oral argeements can be valid, but they are also rather difficult to enforce.

A license holder must disclose the fact that he or she represents a party upon the first contact with another party or a license holder representing another party. This disclosure may be oral or in writing.

SAE, Salesperson Apprenticeship Education, courses are 30-hour courses which are required to renew your license for the first time and/or if you have not reached 270 hours of core real estate courses. Mandatory Continuing Education (CE) courses are required every two years after your first year.

The Texas Real Estate Commission (TREC) is located at https://www.trec.texas.gov/ Phone Number: (512) 936-3000 Texas Real Estate Commission PO Box 12188 Austin, TX 78711-2188

Mortgage points, also known as discount points, are fees paid directly to the lender at closing in exchange for a reduced interest rate. This is also called “buying down the rate,” which can lower the monthly mortgage payments. One point costs 1 percent of the mortgage amount (or $1,000 for every $100,000).

Real Property - means land, an improvement, a mine or quarry, a mineral in place, standing timber, or an estate or interest in any such property. Personal property - means property that is not real property.

You are legally required to keep rental premises livable in Texas, under a legal doctrine called the “implied warranty of habitability.” If you don’t take care of important repairs, such as a broken heater, tenants in Texas may have several options, including the right to “repair and deduct” from the rent.

In order to be valid in Texas, a holographic will must be wholly in the handwriting of the testator and signed by him or her. A holographic will can be written on anything, including stationery, and does not have to be signed by witnesses.

To remember the elements of a deed, remember CEDDING: Consideration (valuable or good) Execution (signed by a competent grantor and two witnesses) Description of property. Delivery and acceptance (voluntary) Interest or estate being conveyed (habendum clause) Names of a grantee and grantor.

Escheat is a common law doctrine that transfers the property of a person who died without heirs, to the state. It serves to ensure that property is not left in "limbo" without recognized ownership.

Co-Owners Who Are Not Spouses Texas law presumes that if two nonspouses are named as co-owners, and nothing more is said, then they are tenants-in-common (Tex. Est. Code §101.002). This means they each person owns an undivided one-half interest in the property but there is no automatic right of survivorship. When one co-owner dies, the interest of the deceased co-owner goes directly to that person's heir or heirs, either by will or by intestate succession. The line of succession is vertical, downward to the heirs of the deceased, rather than horizontal, across to the co-owner. Joint Tenancy with Rights of Survivorship (JTWROS) Joint tenancy with rights of survivorship has been dubbed the "poor man's will," since it eliminates the need for a last will and testament as to a particular piece of property (but not others, obviously). JTWROS comes up in two contexts, between non-spouses and spouses. Tenancies In Common In Texas The default form of co-ownership in Texas is a tenancy in common. A tenancy in common occurs when two or more parties jointly hold an interest in property. These co-owners hold an undivided interest and right to possess the property. Each party may freely sell, devise, lease, or otherwise transfer their interest in the property. When a party dies their share of the property will pass via their will or, if the party died without a will, according to the intestacy statute. In general, co-ownership of property in Texas is presumed to be a tenancy in common, absent explicit language to the contrary, as discussed below. Joint Tenancies In Texas The key distinction between a tenancy in common and a joint tenancy is that a joint tenancy contains a right of survivorship. These means that upon the death of one owner their share of the property will pass to the surviving co-owners. A joint tenant’s interest is therefore not freely devisable in a will. Unlike most states Texas does not automatically recognize joint tenancies as having a right of survivorship. Instead the parties must agree, in writing, to include a right of survivorship. Practice Tip: Never advise a client on the correct type of ownership of a property. This is a question for an experienced attorney, and a liability that is unwise to assume.

In order to take the Texas Real Estate license exam, you must complete 180 classroom hours of the following qualifying real estate courses: Principles of Real Estate I (30 classroom hours) Principles of Real Estate II (30 classroom hours) Law of Agency (30 classroom hours) Law of Contracts (30 classroom hours) Promulgated Contract Forms (30 classroom hours) Real Estate Finance (30 classroom hours)

Texas is a community property state, which means that most property acquired during marriage belongs to both spouses and must be divided at divorce. In contrast, each spouse gets to keep his or her separate property when the marriage ends.

A sales agent is a person who is licensed by the Real Estate Commission to act as an agent on behalf of a real estate broker and their clients. A sales agent must be sponsored by a licensed Broker in order to perform any act of real estate services. You have one year from the date your application is filed to meet all license requirements. Once you have met all the requirements to get your license, including finding a broker sponsorship, TREC will send an active sales agent license to your broker and to you via email. To qualify For A Texas Real Estate license you must: Be a citizen of the United States or lawfully admitted alien Be 18 years of age or older Be a Resident of Texas and Meet TREC’s qualifications for honesty, trustworthiness, and integrity. Consider requesting a Moral Character Determination before applying for the license.

All commissions must be paid through the agent’s sponsoring broker.[TRELA §1101.651(b)] Further, a business entity that receives compensation on behalf of a license holder must be licensed as a broker. [TRELA §1101.355(c)] Practice Tip: Your sponsoring broker will be explain the commission process of the real estate agency to you.

You cannot enforce your right to collect your commission from a seller or buyer unless you have a signed written agreement with them agreeing to pay your commission, according to Section 1101.806(c) of the Real Estate License Act. Section 1101.559 of the Real Estate License Act requires brokers who act as intermediaries to obtain the written consent of each party in the transaction and that written consent must also state who will pay the broker. Texas law requires all brokers and sales agents to provide written notice regarding information about brokerage services at the first substantive communication with prospective buyers, tenants, sellers, and landlord concerning specific real property. The Information About Brokerage Services form (or the IABS), is the required method to provide that information to those parties.

Texas homestead law protects qualifying real property from forced sale by general creditors, and courts have interpreted the laws broadly to help accomplish their goals. A homestead can be either urban property or rural property. There is no limit to the value of urban or rural homesteads, only to their size. Eligibility for homestead exemptions in Texas include age 65 or older and disabled exemptions: Individuals age 65 or older or disabled residence homestead owners qualify for a $10,000 homestead exemption for school taxes, in addition to the $25,000 exemption for all homeowners.

Notice to Vacate Prior to Filing Eviction Suit. (a) If the occupant is a tenant under a written lease or oral rental agreement, the landlord must give a tenant who defaults or holds over beyond the end of the rental term or renewal period at least three days' written notice to vacate the premises before the landlord files a forcible detainer suit, unless the parties have contracted for a shorter or longer notice period in a written lease or agreement. A landlord who files a forcible detainer suit on grounds that the tenant is holding over beyond the end of the rental term or renewal period must also comply with the tenancy termination requirements of Section 91.001. The notice to vacate shall be given in person or by mail at the premises in question. Notice in person may be by personal delivery to the tenant or any person residing at the premises who is 16 years of age or older or personal delivery to the premises and affixing the notice to the inside of the main entry door. Notice by mail may be by regular mail or by registered or certified mail, return receipt requested, to the premises in question. (g) The notice period is calculated from the day on which the notice is delivered. (h) A notice to vacate shall be considered a demand for possession for purposes of Subsection (b) of Section 24.002.

Easement by prescription refers to an easement created by the open, notorious, uninterrupted, hostile, and adverse use of another's land for a period set by statute. State law, which varies by state, defines the time period required to acquire a prescriptive easement. One cannot own an easement across his or her property. An easement may be created by various means. Each has its own distinct requirements. Because easements represent interests in land, they generally require some written, tangible evidence prescribed by Section 5.021 of the Texas Property Code for their creation.

§531.1 Fidelity A real estate broker or salesperson, while acting as an agent for another, is a fiduciary. Special obligations are imposed when such fiduciary relationships are created. They demand: that the primary duty of the real estate agent is to represent the interests of the agent's client, and the agent's position, in this respect, should be clear to all parties concerned in a real estate transaction; that, however, the agent, in performing duties to the client, shall treat other parties to a transaction fairly; that the real estate agent be faithful and observant to trust placed in the agent, and be scrupulous and meticulous in performing the agent's functions; and that the real estate agent place no personal interest above that of the agent's client.

A holographic will is a handwritten will. In order to be valid in Texas, a holographic will must be wholly in the handwriting of the testator and signed by him or her. A holographic will can be written on anything, including stationery, and does not have to be signed by witnesses.

Homestead exemptions remove part of your home's value from taxation, so they lower your taxes. For example, your home is appraised at $100,000, and you qualify for a $25,000 exemption (this is the amount mandated for school districts), you will pay school taxes on the home as if it was worth only $75,000

Dower is a provision accorded by law, but traditionally by a husband or his family, to a wife for her support in the event that she should become widowed. It was settled on the bride (being gifted into trust) by agreement at the time of the wedding, or as provided by law. While Texas is a "community property" state, that doesn't mean everything gets split perfectly in half when spouses divorce. The state defines marital (or community) property as all property acquired by either spouse during the marriage, excluding separate property.

However, a person actively licensed as a real estate broker or sales agent in another state may be entitled to have certain experience and educational requirements waived. Contact TREC for this information. A Texas broker may share a commission with a foreign license holder so long as the foreign license holder does not engage in an activity requiring a license in Texas. [TRELA §1101.651(a)] In addition, a person actively licensed as a real estate broker or sales agent in another state may be entitled to have certain experience and educational requirements waived. [TRELA §1101.357 and §1101.362, Rule 535.62(b)]

License Fees: All Licenses issue for a two-year period. $20 paper processing fee is not included in the fees. Sales Agent - Initial $205.00 Miscellaneous Fees Fingerprint Fee – paid to Morpho Trust if the applicant has not previously been fingerprinted for TREC. $37.00 Background Check Fee – due on initial applications and renewals if applicant has previously been fingerprinted for TREC $27.00 Real Estate Recovery Fee – due on initial applications for a license $10.00 Paper Processing Fee – due if you submit a paper application for a transaction that can be submitted online $20.00