TREC Disclosure of Relationship with Residential Service Company

What is the TREC Disclosure of Relationship with Residential Service Company?

It is a form of the Texas Real Estate Commission (TREC). The commission's website lists it as "Disclosure of Relationship with Residential Service Company" with the form ID RSC-4. The form itself is headed "DISCLOSURE OF RELATIONSHIP WITH CONTRACT PROVIDER OR ADMINISTRATOR". Its footer says what it is for: "This form has been approved by the Texas Real Estate Commission (TREC) for use by license holders to disclose payments received from a residential contract provider or administrator."

The blank on this page is the edition marked "RSC-4", with the printed date "05-16-2023".

The commission's page of the form says when it is given: "This disclosure form is required to be provided if a license holder receives any form of compensation from a residential service company. That compensation can not be contingent upon a party to the real estate transaction purchasing a contract or services from the residential service company."

What does the form say about residential service contracts?

The form opens with a definition: "A residential service contract is a product under which a residential service contract provider or administrator (Provider), for a fee, agrees to repair or replace certain equipment or items in a property." It adds: "Providers are licensed and regulated by the Texas Department of Licensing and Regulation. The extent of coverage and the cost of coverage will vary." It tells the buyer: "YOU MAY CHOOSE ANY PROVIDER."

Two more statements are printed in capitals:

• "THE PURCHASE OF A RESIDENTIAL SERVICE CONTRACT IS OPTIONAL."
• "NEITHER A BROKER/SALES AGENT NOR A SELLER MAY CONDITION THE SALE OF A PROPERTY ON THE BUYER'S PURCHASE OF A RESIDENTIAL SERVICE CONTRACT."

What is disclosed on the form?

The form has two columns, one for the "Other Broker/Sales Agent" and one for the "Listing Broker/Sales Agent". Each column has two check boxes:

• one for the statement that the broker or sales agent "will receive no compensation from a Provider";
• one for the statement that the broker or sales agent "receives compensation from the following Provider:", with lines for the Provider and, under the words "for providing the following services:", lines for the services.

Under the columns the form states: "The compensation is not contingent upon a party to the real estate transaction purchasing a contract or services from the Provider." It also states: "The compensation is the fee for the services that Listing Broker or Other Broker, either directly or through an agent, provides to the company. As required by the Real Estate Settlement Procedures Act and HUD Regulation X, any fees paid to a settlement services provider are limited to the reasonable value of services actually rendered."

What is at the bottom of the form?

Under each column there is a line for the broker's name and license number ("Other Broker's Name", "Listing Broker's Name", "License No.") and a line that begins "By:". Then come the words "The undersigned acknowledges receipt of this notice:" with two lines marked "Buyer" and two lines marked "Seller". The form has no line for a date.

The commission publishes the form on its page Disclosure of Relationship with Residential Service Company.