Posted On: June 25, 2020

What is the Texas Real Estate License Act (TRELA)?

The Texas Real Estate Act (TRELA) is state legislation that sets standards for how real estate agents conduct themselves in Texas. It resides in Title 7 Chapter 1101 of the Texas Occupations Code.

The History and Purpose of TRELA

TRELA was originally passed in 1939 as the Real Estate Dealers License Act. In 1955, it was renamed the Texas Real Estate License Act. The original law set up a licensing system for people who broker the sale of real estate. By defining who has the legal authority to perform certain actions in the real estate market, Texas was able to protect the public by enforcing a certain level of competence and ethics. Real estate license laws were administered by the Texas secretary of state for the first ten years. In 1949, the Texas Real Estate Commission (TREC) was created to administer and enforce TRELA. Over time, TREC became responsible for regulating real estate professionals beyond salespersons and brokers, including inspectors, education providers, timeshare developers, and more.

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What Does the Texas Real Estate Act Do?

In its current form, TRELA creates two license levels for professionals who assist in the sale of real estate: Salesperson and Broker. It defines what activities require a real estate license in Texas and which activities are reserved for Brokers. TRELA lays out the minimum requirements for obtaining a Texas real estate license. It also sets expiration and renewal terms to make it easier to hold licensees to updating standards. The act establishes a code of ethics and standard of conduct for the behavior of real estate salespersons and brokers, regarding both their treatment of consumers and competition. It establishes disciplinary proceedings, penalties, and civil or criminal liability. It creates processes for filing a complaint against a license holder. TRELA also requires real estate licensees to use standard contract forms that are drafted and revised by the Texas Real Estate Broker-Lawyer Committee, in order to make the terms of real estate transactions more consistent. Finally, the Texas Real Estate Act establishes the rules for the membership and appointment of both TREC and the Real Estate Broker-Lawyer Committee, as well as the rules by which both committees operate.

Does TRELA Contain All the Rules for Texas Salespersons and Brokers?

No, because TRELA empowers the Texas Real Estate Commission to create administrative rules, as well. Some of TREC's rules add specificity to TRELA's provisions, and some create related policies. Additionally, there are federal regulations that affect the conduct of all U.S. real estate agents, like the U.S. Fair Housing Act. Your county or municipal jurisdiction may have other rules.

How Do You Learn More About TRELA's Provisions?

Required education about TRELA is actually built into TRELA's criteria. It's easy to forget TRELA is behind much of your real estate education. In many cases, your coursework won't specify whether a particular rule comes from TRELA or TREC or somewhere else – the source matters less than knowing the rules themselves. Still, as you sit down for Texas pre-license courses, SAE courses, or continuing education, you'll be studying the Texas Real Estate License Act, whether you realize it or not.

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