Texas Real Estate Broker Exam — All Questions

Since 1 January 2026, when must a Texas license holder have a written agreement with a prospective buyer in place?

• a.Before making a written offer on any property, residential or not
• b.Before the buyer's first substantive communication with the broker
• c.Within three days after the buyer's first showing appointment
• d.Before showing the buyer any residential real property✓

Occupations Code § 1101.563(b), added by SB 1968 and effective 1 January 2026: a license holder who performs any act of real estate brokerage for a prospective buyer of residential real property "must enter into a written agreement with the prospective buyer before: (1) showing any residential real property to the prospective buyer; or (2) if no residential real property will be shown, presenting an offer to purchase residential real property on behalf of the prospective buyer." The offer is the fallback trigger for the case where nothing is shown, not the general rule, and the duty is confined to residential real property, which § 1101.563(a) defines as a single-family house, a duplex, triplex or quadraplex, or a condominium or co-operative unit — a commercial purchaser is outside it. The first-substantive-communication clock belongs to a different document, the written notice required by § 1101.558(b-1). And there is no grace period after a showing, because the agreement has to exist before the showing happens; failing to enter into it is now its own ground for discipline under § 1101.652(b)(34).

A Texas broker agrees to represent both the seller and the buyer in one sale. TRELA requires the broker to:

• a.Act as intermediary, with written consent from each of the parties✓
• b.Withdraw from one side and refer that party to another brokerage
• c.Obtain oral consent from both parties before the offer is written
• d.Appoint one associated license holder to advise both of the parties

Occupations Code § 1101.561(b): "A broker must agree to act as an intermediary under this subchapter if the broker agrees to represent in a transaction: (1) a buyer or tenant; and (2) a seller or landlord." Section 1101.559(a) then sets the conditions: the broker "obtains written consent from each party for the broker to act as an intermediary" and that consent "states the source of any expected compensation." Withdrawal is therefore not required and not the design — the intermediary structure exists precisely so one firm can hold both sides. Oral consent will not do, because the statute names writing; § 1101.559(b) treats a written listing or buyer representation agreement as sufficient consent where it "specifies in conspicuous bold or underlined print the conduct that is prohibited under Section 1101.651(d)." And putting a single associated license holder on both sides defeats § 1101.560, which appoints one license holder to communicate with and advise each party separately.

A seller's broker receives a low offer he is confident the seller will reject. Under TRELA he:

• a.Must inform the seller of the offer and present it to the seller✓
• b.May screen it out if the listing sets a minimum acceptable price
• c.Must present it only if the buyer's broker demands that in writing
• d.May hold it until a better offer arrives and present them together

Occupations Code § 1101.557(b) says a broker who represents a party "must inform the party if the broker receives material information related to a transaction to list, buy, sell, or lease the party's real estate, including the receipt of an offer by the broker" and "shall, at a minimum, answer the party's questions and present any offer to or from the party." The words at a minimum make this a floor the listing agreement cannot bargain below, so a stated minimum price does not license the broker to screen offers out — it is the seller who decides what to do with a low offer. Nothing conditions the duty on a demand from the other side, because it is owed to the broker's own client rather than to the buyer's broker. And holding the offer back to pair it with a better one withholds exactly the material information the same subsection requires be passed on, and it does so at the moment the seller could still act on it.

A Texas broker sues a seller for an unpaid commission on an oral listing. The action fails because TRELA requires:

• a.The listing to have been filed with the Commission before the sale
• b.The promise to be in writing and signed by the party being sued✓
• c.The broker to have been the procuring cause of the completed sale
• d.The seller to have accepted a full-price offer from a ready buyer

Occupations Code § 1101.806(c): "A person may not maintain an action in this state to recover a commission for the sale or purchase of real estate unless the promise or agreement on which the action is based, or a memorandum, is in writing and signed by the party against whom the action is brought or by a person authorized by that party to sign the document." Nothing is filed with TREC to make a commission agreement enforceable — the Commission licenses and disciplines; it does not record private contracts. Procuring cause and a full-price offer are arguments about whether a commission was earned under an agreement, and neither is ever reached here, because § 1101.806(c) stops the action at the threshold when there is no signed writing to sue on. Note where Texas puts this rule: Business and Commerce Code § 26.01(b) lists "a contract for the sale of real estate" but not a real-estate commission agreement, which TRELA handles instead.

Which task may a broker's unlicensed assistant lawfully perform in Texas?

• a.Host an open house at a listed property on the broker's behalf
• b.Address and post letters the broker has written and approved✓
• c.Answer a caller's questions about a listing's condition and price
• d.Unlock a listed house so a prospective buyer can walk through it

22 TAC § 535.4(c): "Unless otherwise exempted by the Act, a person must be licensed as a broker or sales agent to show a property. For purposes of this section, to 'show' a property includes causing or permitting the property to be viewed by a prospective buyer or tenant, unlocking or providing access onto or into a property for a prospective buyer or tenant, and hosting an open house at the property." Hosting the open house and unlocking the door for a buyer are each named in that sentence, so each requires a license. Fielding a caller's questions about a listing's condition and price is negotiating and advising about specific real property, and TREC's guidance is flat: "An unlicensed person may not engage in any activity for which a license is required. [TRELA § 1101.002(1) and Rules 535.4 and 535.5]." Clerical work that the license holder has already done the substantive part of is not on the list — posting letters the broker wrote and approved involves no showing, no negotiating and no advising, and the broker remains responsible for the content under 22 TAC § 535.2.

In Texas, a sales agent may perform licensed real estate activity:

• a.Independently once the license is active
• b.For any broker who pays the highest commission on a given deal
• c.Only for and in the name of the broker who sponsors the agent✓
• d.Only after obtaining a separate court appointment

A Texas sales agent must be sponsored by a broker and may act only for and in the name of that sponsoring broker, who is answerable for how the agent's licensed work is carried out. That is the central difference from the broker license: an active license does not by itself let the agent operate as an independent business. Nor does the agent pick whose name to work under deal by deal, because the sponsorship relationship, and not the size of the fee offered on a particular transaction, settles who the agent acts for and who answers for the work. The authority to practice comes from the license and the sponsorship, which is an administrative matter; no court order or appointment plays any part in it.

A Texas broker who sponsors sales agents is responsible for:

• a.Supervising the agents' transactions, advertising and client money✓
• b.Personally attending every showing and inspection the agents hold
• c.Paying the income taxes owed on the agents' commissions
• d.Guaranteeing that each listing the firm takes eventually sells

A sponsoring broker is responsible for the acts of sponsored agents and must maintain written policies covering their work. 22 TAC § 535.2(a) says that "unless such scope is limited or revoked in writing, a broker is responsible for the authorized acts of the broker's sales agents," (c) makes the broker "responsible for the proper handling of trust funds placed with the broker," and (g) makes the broker "responsible to ensure that a sponsored sales agent's advertising complies" with the advertising rules. The same rule settles the second answer expressly: the broker "is not required to supervise the sales agents directly," and adequate supervision is a matter of policies, records and review rather than attendance at every showing, which no firm of any size could sustain. The duty reaches the agents' licensed conduct, not their private finances, so their income tax remains their own. And it is a duty of process rather than of outcome — nothing obliges a broker to deliver a sale, because whether a listing sells turns on the market and the parties.

The Information About Brokerage Services (IABS) notice in Texas must be provided:

• a.Only at the closing table, together with the rest of the transaction paperwork
• b.Within 30 days after the transaction has closed and been funded
• c.Only when the party requests a copy of the notice from the license holder
• d.At the first substantive communication with a party about a property✓

Texas ties this notice to a party, not to a client. Occupations Code § 1101.558(b-1) requires a license holder, "at the time of a license holder's first substantive communication with a party relating to a proposed transaction regarding specific real property," to provide written notice in at least a 10-point font. A party includes someone who never becomes the license holder's client, so a buyer's agent still owes the notice to an unrepresented seller he contacts directly. As amended by SB 1968 effective 1 January 2026 the notice must carry four things, not three: it "(1) describes the ways in which a broker can represent a party to a real estate transaction, including as an intermediary; (2) describes the basic duties and obligations a broker has to a party ... that the broker represents; (3) describes the basic obligations a broker has to a party ... that the broker does not represent; and (4) provides the name, license number, and contact information for the license holder and the license holder's supervisor and broker, if applicable." TREC's revised IABS 1-2 form carries the added item. Because the whole value of the notice is reaching the consumer before they begin relying on the license holder, handing it over at closing, or after the transaction has ended, delivers it long after every decision it was meant to inform. Nor is it supplied on request: the duty rests on the license holder and cannot wait for a consumer with no reason to know the notice exists. It is informational and does not by itself create a representation agreement, and § 1101.558(c)(3) removes the duty at an open house.

When a Texas broker represents both the buyer and the seller in the same transaction, Texas law describes the broker's role as a(n):

• a.Dual agent
• b.Subagent
• c.Facilitator with no duties
• d.Intermediary✓

Texas does not use the term 'dual agency.' When a broker represents both parties in one transaction, the broker acts as an intermediary. That requires written consent from both parties in their representation agreements, and the broker may appoint different associated license holders to advise each party, with confidential information kept from crossing the transaction. Subagency described a different arrangement altogether, one licensee working through and for another party's broker rather than a single broker holding representation agreements with both sides; note that SB 1968 repealed the TRELA definition of subagent effective January 1, 2026, so it is no longer a Texas brokerage status and cannot be the answer to a current-law question. And the role is not a duty-free go-between: the intermediary still owes the parties the obligations those written agreements create, including impartiality and the protection of each side's confidences.

In a Texas intermediary transaction, an appointed license holder must:

• a.Refuse to communicate with either party
• b.Reveal the seller's lowest acceptable price to the buyer during negotiations
• c.Represent both parties equally in all confidential matters
• d.Keep each party's confidential information from the other side✓

In an intermediary transaction, the intermediary and any appointed license holders must remain impartial and must not disclose confidential information, such as the price or terms a party will accept, to the other side. Volunteering the seller's lowest acceptable price is precisely the disclosure the rule forbids, since it hands one party the other's negotiating position. Treating confidences as something shared equally with both sides misreads the structure, because appointment exists so that each party can receive advice from a separate associated license holder while what each says in confidence stays with that appointee. Nor does the role call for silence: the appointed license holder is there to communicate with and advise the party appointed to, within those limits.