Chapter 7 - Subchapter H Flashcards
Sec. 1101.351.
License Required outlines what a person is prohibited from doing without a license.
This section says that unless a person holds a license issued under this chapter, the person may not:
⦁ act as or represent that the person is a broker or salesperson.
⦁ act as a residential rental locator.
In the same vein, unless a business entity holds a license issued under this chapter, the business entity may not act as a broker.
Sec. 1101.352.
License Application states the following:
⦁ Each applicant for a broker or salesperson license must submit an application on a form prescribed by the commission.
⦁ Each applicant for a broker or salesperson license must disclose in the license application whether the applicant has entered a plea of guilty or nolo contendere to a felony or been convicted of a felony and the time for appeal has elapsed or the judgment or conviction has been affirmed on appeal.
This point is critical. Even if you feel a conviction or plea of nolo contendere is insignificant, you must disclose it. Lack of disclosure is strong cause for rejecting an application for licensure.
Sec. 1101.3521.
Criminal History Record Information Requirement for License describes the commission requirements as follows:
⦁ The commission will require that an applicant for a license or renewal of an unexpired license submit a complete and legible set of fingerprints, on a form prescribed by the commission, to the commission or to the Department of Public Safety for the purpose of obtaining criminal history record information from the Department of Public Safety and the Federal Bureau of Investigation.
⦁ The commission will refuse to issue a license to or renew the license of a person who does not comply with the above requirement.
⦁ The commission will conduct a criminal history check of each applicant for a license or renewal of a license using information provided by the individual as well as information made available to the commission by the Department of Public Safety, the Federal Bureau of Investigation, and any other criminal justice agency under Chapter 411, Government Code.
⦁ The commission may enter into an agreement with the Department of Public Safety to administer the required criminal history check and authorize the Department of Public Safety to collect from each applicant the costs incurred by the department in conducting the criminal history check.
Sec. 1101.353.
Moral Character Determination states under what circumstances the commission will determine an applicant’s moral character.
⦁ If before applying for a license under this chapter a person requests that the commission determine whether the person’s moral character complies with the commission’s moral character requirements for licensing under this chapter and pays the fee prescribed by Section 1101.152, the commission will make its determination of the person’s moral character.
⦁ Within 30 days after the date the commission makes its determination, the commission will notify the person of the determination.13
When should you request a Fitness Determination (FD) to determine if you meet the moral character requirements? You should request an “FD” if you:
⦁ have any criminal offenses.
⦁ have any unpaid judgments.
⦁ have had discipline taken against a professional or occupational license.
⦁ have performed unlicensed activity.
Here’s a tip! The FD process is significantly cheaper than paying for an application, an examination, and the education necessary to receive a license.13
Sec. 1101.354.
General Eligibility Requirements states the general requirements for eligibility.
To be eligible to receive a license under this chapter, a person must at the time of application be:
⦁ at least 18 years of age.
⦁ a citizen of the United States or a lawfully admitted immigrant.
⦁ a resident of this state.
The applicant must also:
⦁ satisfy the commission as to the applicant’s honesty, trustworthiness, and integrity.
⦁ demonstrate competence based on an examination under Subchapter I.
⦁ complete the required courses of study, including any required core real estate courses prescribed under this chapter.
Sec. 1101.355.
Additional General Eligibility Requirements for Business Entities states the requirements for business entity eligibility.
To be eligible for a license under this chapter, a business entity must:
⦁ designate one of its managing officers as its agent and
⦁ provide proof that the entity maintains errors and omissions insurance with a minimum annual limit of $1 million for each occurrence if the designated agent owns less than 10 percent of the business entity.
A business entity may not act as a broker unless the entity’s designated agent is a licensed broker in active status and good standing according to the commission’s records.
A business entity that receives compensation on behalf of a license holder must be licensed as a broker under this chapter.
Sec. 1101.356.
Broker License: Experience and Education Requirements lays out specific requirements a broker applicant must have.
If you’re unsure whether your college or practical experience meets the requirements below, reach out to TREC. Don’t rely on anyone or any education facility to answer this question. TREC is the only entity that has the authority to accurately answer this question.
An applicant for a broker license must provide to the commission satisfactory evidence that the applicant:
⦁ has had at least four years of active experience in this state as a license holder during the 60 months preceding the date the application is filed.
⦁ has successfully completed at least 60 semester hours, or equivalent classroom hours, of postsecondary education, including:
a. at least 18 semester hours or equivalent classroom hours of core real estate courses, two semester hours of which must be real estate brokerage.
b. at least 42 hours of core real estate courses or related courses accepted by the commission.
Sec. 1101.357.
Broker License: Alternate Experience Requirements for Certain Applicants states the following:
An applicant for a broker license who does not satisfy the experience requirements of Section 1101.356 must provide to the commission satisfactory evidence that the applicant meets all of these criteria:
⦁ He or she is a licensed real estate broker in another state.
⦁ He or she has had at least four years of active experience in that state as a licensed real estate broker or salesperson during the 60 months preceding the date the application is filed.
⦁ He or she has satisfied the educational requirements prescribed by Section 1101.356.
Alternatively, the applicant can provide evidence to the commission that he or she was licensed in this state as a broker in the year before the date the application is filed.
Sec. 1101.358.
Salesperson License: Education Requirements lays out the specific requirements a salesperson applicant must have.
An applicant for a salesperson license must provide to the commission satisfactory evidence that the applicant has completed at least 12 semester hours, or equivalent classroom hours, of postsecondary education consisting of:
⦁ At least four semester hours of core real estate courses on principles of real estate.
⦁ At least two semester hours of each of the following core real estate courses: agency law, contract law, contract forms and addendums, and real estate finance.
Note: Related course credit may no longer be used to meet education requirements for a salesperson’s license.
Sec. 1101.359.
Alternate Education Requirements for Certain License Holders discusses the requirement for those persons who are not subject to the requirements previously covered.
An applicant for a broker license who isn’t subject to the education requirements of Section 1101.356(a)(2) and an applicant for a salesperson license who isn’t subject to the education requirements of Section 1101.358 or 1101.454 must provide to the commission satisfactory evidence that the applicant has completed the number of classroom hours of continuing education that would have been required for a timely renewal under Section 1101.455 during the two (2) years preceding the date the application is filed.
Sec. 1101.360.
Texas does not accept real estate licenses from other states. Therefore, anyone from another state who wants to practice in Texas must meet all the requirements outlined in Subchapter H.
Eligibility Requirements for Certain Nonresident Applicants covers the commission’s rules for nonresidents seeking licensure in Texas.
A resident of another state who isn’t a licensed real estate broker and who was formerly licensed in this state as a broker or salesperson may apply for a license under this chapter not later than the first anniversary of the date of the expiration of the former license.
A nonresident applicant is subject to the same license requirements as a resident. The commission may refuse to issue a license to a nonresident applicant for the same reasons that it may refuse to issue a license to a resident applicant.
A nonresident applicant must submit with the application an irrevocable consent to a legal action against the applicant in the court of any county in this state in which a cause of action may arise or in which the plaintiff may reside. The action may be commenced by service of process or pleading authorized by the laws of this state or by delivery of process on the Executive Director or Assistant Executive Director of the commission.
The consent must do all of the following:
⦁ Stipulate that the service of process or pleading is valid and binding in all courts as if personal service had been made on the nonresident in this state
⦁ Be acknowledged
⦁ If made by a corporation, be authenticated by its seal
Sec. 1101.361.
Additional Eligibility Requirements for Certain Nonresident Applicants lists other requirements for nonresident applicants.
A nonresident applicant for a license who resides in a municipality whose boundary is contiguous at any point with the boundary of a municipality in this state is eligible to be licensed under this chapter in the same manner as a resident of this state if the nonresident has been a resident of that municipality for at least 60 days preceding the date the application is filed.
Sec. 1101.362.
Waiver of License Requirements: Previous License Holders states that the commission by rule may waive some or all of the requirements for a license under this chapter for an applicant who was licensed under this chapter within the six (6) years preceding the date the application is filed.
Sec. 1101.363.
Issuance of License says that the commission will issue an appropriate license to an applicant who meets the requirements for a license.
In addition, the commission may issue an inactive salesperson license to a person who applies for a salesperson license and satisfies all requirements for the license. The person may not act as a salesperson unless the person is sponsored by a licensed broker who has notified the commission that he or she is assuming responsibility for the salesperson (as discussed in Section 1101.367). In this situation, the licensed broker isn’t required to pay the fee required by that subsection.
A license remains in effect for the period prescribed by the commission if the license holder complies with this chapter and pays the appropriate renewal fees.
Sec. 1101.364.
Denial of License states that the commission must immediately give written notice to the applicant of the commission’s denial of a license. A person whose license application is denied under this section is entitled to a hearing.
