The new real estate contract promulgated by the Texas Real Estate Commission will become mandatory as of April 1, 2021, and includes several noteworthy changes for agents and sellers alike.
There are many changes to the new contract, including how the option fee is held. The option fee must now be held by the escrow agent and credited toward the purchase price, rather than be paid directly to the seller as in the past.
Another change – which could have a big impact on the seller – is on the Addendum for Property Subject to Mandatory Membership in a Property Owners Association. The old addendum clearly stated the buyer was responsible for paying the deposit for any reserves required by the Association at closing. The new addendum lumps together all Association fees, deposits, reserves, transfer fees and other charges, with a blank line for the ‘Maximum amount to be paid by Buyer’ to be filled in and the seller must pay any excess.
Since the buyer formerly paid any deposits for reserves, if the agent filling in the ‘Maximum amount to be paid by Buyer’ line is not careful, it could potentially cost the seller thousands.
We are confident that all real estate professionals will be well-versed in and prepared for these changes, but please feel free to contact our office with any questions, concerns, or if any problems arise. The updated forms are also available on the Texas Real Estate Commission website.