By Kaema Roberson, VP – Director of Education
Get involved! Comment on the proposed TREC form revisions by September 26th.
Currently, the proposed forms are out for public comment, and the earliest possible adoption date is November 7th, when the Commission meets for its quarterly meeting. Once the forms are adopted, Independence Title will hold classes to cover the form updates.
You can find the proposed forms by clicking this link: https://www.trec.texas.gov/rules-and-laws
Scroll down the page to the section that says Recently Proposed Rules.
Here are a few notable proposed changes:
Important items in the proposed changes to the 1-4 Family Contract:
- A new “required notices” section is added to Paragraph 6, which provides one location where MUD, PID, or other similar notices that have been given or are attached to the contract can be listed. The corresponding reference to the Commission’s form “Addendum containing Notice of Obligation to Pay Improvement District Assessment” is removed from Paragraph 22.
- New paragraph 9.B(5) provides that private transferfees will be the obligation of the seller unless otherwise provided in this contract.
- Paragraph 13 is amended to clarify what amounts will be prorated through the closing date.
- Paragraph 18.B is amended to add that if no closing occurs, the escrow agent may require a written release of liability before releasing the earnest money.
Important items in the proposed changes to the HOA Addendum:
The Addendum for Property Subject to Mandatory Membership in a Property Owners Association is amended to except prepaid regular periodic maintenance fees, assessments, or dues from the buyer’s obligation to pay any and fees associated with the transfer of the property not to exceed a certain amount, and the seller pays the excess. Language is also added to clarify that these fees should be prorated pursuant to Paragraph 13 of the Contract. Finally, the amended language adds that the paragraph does not apply to a fee that is not imposed by the Association, even if it is collected by the Association for the benefit of a third party.
As always, Independence Title will keep you up to date on TREC-related matters. We have planned to teach our Form Updates class starting in late November if the commission votes to adopt the forms.