Standards of Conduct
Area III is nine scored items — the largest single block outside agency and the case studies. It covers the Canons of Professional Ethics, the grounds for discipline, the line against practicing law, trust accounts, fee splitting, rebates and advertising.
Ethics and the grounds for discipline
The Canons at 22 TAC §§ 531.2-531.4 impose fidelity, integrity and competency: a license holder acting as an agent is a fiduciary whose primary duty is to represent the client's interests, who must treat other parties fairly, and who must place no personal interest above the client's. Section 1101.652 lists the grounds for suspension or revocation. Since 1 January 2026 subsection (b)(34) adds a new one — failing to enter into a written agreement with a prospective buyer as required by § 1101.563.
Unauthorized practice of law
22 TAC § 537.11(b) bars a license holder from practicing law, giving legal advice, opining on the legal effect of contract forms or the validity of title, or drafting or recommending language defining or affecting the rights, obligations or remedies of the principals — escalation, appraisal and contingency clauses are named. What is permitted is narrow and precise: explaining the meaning of informational items or choices in a form (§ 537.11(c)(2)), and, if specifically instructed in writing by a principal, adding or striking language so long as the change is made conspicuous (§ 537.11(d)(2)).
Trust money
A sales agent may not maintain a trust account, and any trust money an agent receives must be delivered immediately to the sponsoring broker (22 TAC § 535.146(b)(2)). The broker must deposit it in a trust account or deliver it to an authorized escrow agent no later than the close of business of the second working day after receiving it. Placing trust money in a personal or operating account is prima facie evidence of commingling. Disbursement may be made only in accordance with the agreement under which the money was received; on a written demand the broker has 30 days, and where the right party cannot be determined the broker may interplead.
Fees, rebates and advertising
Section 1101.651(a) allows a broker to compensate only a license holder or a broker licensed in another state who conducted no negotiations in Texas. A sales agent may accept compensation only from the sponsoring broker (§ 1101.651(b)). Rebates run the other way and are allowed: 22 TAC § 535.147(d) lets a license holder rebate part of a fee to a party in the transaction with the written consent of the sponsoring broker and the party represented. Every advertisement must carry the name of the license holder or team placing it and the broker's name in at least half the size of the largest contact information for any sales agent, associated broker or team name (§ 535.155).
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State-specific details
State exam facts
- State regulator
- Texas Real Estate Commission (TREC)
- Exam vendor
- Pearson VUE
- Prelicensing education
- 900 classroom hours (270 qualifying + 630 related)
- Time limit
- 240 minutes
Who regulates real estate brokers in Texas?
The Texas Real Estate Commission (TREC) licenses brokers and sales agents under the Texas Real Estate License Act (Occupations Code Chapter 1101) and the TREC rules at 22 Texas Administrative Code Part 23. TREC contracts with Pearson VUE to schedule and deliver the licensing exams at test centers across Texas.
What experience do I need before the Texas broker exam?
Broker applicants must have four years of active experience as a license holder during the 60 months preceding the application (Occupations Code § 1101.356(a)(1)) and must document not less than 720 qualifying experience points on TREC's Qualifying Experience Report (22 TAC § 535.56(b)(2)) — the points floor rose from 360, so older study material understates it. The education requirement is 270 hours of qualifying real estate courses plus 630 classroom hours of related education, and the six-hour Broker Responsibility Course is now required of every broker applicant.
How is the Texas broker exam structured?
Pearson VUE delivers a national portion of 80 scored questions and a Texas state portion of 50 scored questions in a single 4-hour session. Content outline #094401 splits the 50 state items into seven areas: TREC's duties and powers (3), licensing (4), standards of conduct (9), agency and brokerage (10), contracts (8), special topics (6) and case studies (10). Each portion is scored separately and you must pass both; confirm the current scored-question counts in TREC's Candidate Handbook.
What are the Texas case-study questions?
A fifth of the Texas state portion is case studies. Pearson VUE's outline says these "include both narrative cases and contract cases. Narrative cases require candidates to read a case study and respond to multiple associated items. Contract cases require candidates to respond to items based on use of TREC-promulgated contracts" — so expect fact patterns worked on forms such as TREC No. 20-19, the One to Four Family Residential Contract (Resale).
Sources: https://www.pearsonvue.com/content/dam/VUE/vue/en/documents/publications/094401.pdf, https://www.trec.texas.gov/agency-information/rules-and-laws/trec-rules, https://www.trec.texas.gov/exam-topic-reports, https://www.pearsonvue.com/us/en/tx/realestate.html
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