{"id":10423,"date":"2026-10-09T13:12:00","date_gmt":"2026-10-09T18:12:00","guid":{"rendered":"https:\/\/lrgrealty.com\/lrg-blog\/?p=10423"},"modified":"2026-10-09T13:12:00","modified_gmt":"2026-10-09T18:12:00","slug":"trec-contract-addenda-texas-guide","status":"publish","type":"post","link":"https:\/\/lrgrealty.com\/lrg-blog\/trec-contract-addenda-texas-guide\/","title":{"rendered":"TREC Contract Addenda in Texas: What Each Form Does and When You Need It"},"content":{"rendered":"
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TREC contract addenda are forms attached to a Texas real estate purchase contract to address conditions that the main agreement does not fully cover. They establish terms for mortgage financing, homeowners association documents, property contingencies, temporary occupancy, and required disclosures. The Texas Real Estate Commission provides standardized forms that licensed agents use when the corresponding circumstances apply.<\/p>\n

The One to Four Family Residential Contract, TREC Form 20-19<\/a>, establishes the basic purchase terms, but addenda address transaction-specific requirements. A financed purchase may need the Third Party Financing Addendum. A home subject to mandatory homeowners association membership calls for the property owners association addendum. Older homes may require federal lead-based paint disclosures. Knowing which forms apply can help buyers and sellers avoid missed deadlines, unexpected expenses, and disputes over termination rights.<\/p>\n

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How TREC Promulgated Contract Forms Work<\/h2>\n

What Does Promulgated Mean?<\/h3>\n

When the Texas Real Estate Commission promulgates a contract form, it approves standardized language for use in specified real estate transactions. The forms help establish consistent procedures for transactions handled by licensed real estate professionals.<\/p>\n

Under TREC Rule 537.11<\/a>, licensed agents and brokers generally must use the applicable forms approved for mandatory use when negotiating transactions, unless an authorized exception applies.<\/p>\n

The standard resale contract is TREC Form 20-19, effective July 1, 2026. It applies to qualifying resale transactions involving single-family homes and residential properties containing up to four units. Condominium resales, certain new-construction transactions, and farm and ranch properties use different contract forms.<\/p>\n

Not every TREC document is mandatory. TREC also approves forms for voluntary use, including the Non-Realty Items Addendum and the lead-based paint disclosure addendum. A legally required disclosure may still be mandatory even when TREC’s particular form for providing it is voluntary.<\/p>\n

Where Agents Can and Cannot Modify a Contract<\/h3>\n

Real estate agents can complete authorized blanks, select applicable boxes, identify factual information, and explain the choices presented in TREC forms.<\/p>\n

They cannot independently draft contractual language that defines or changes the parties’ legal rights, obligations, or remedies. TREC Rule 537.11 restricts this activity because it can constitute the unauthorized practice of law.<\/p>\n

For example, an agent should not invent a financing contingency when a promulgated financing addendum addresses the transaction. Agents also should not use Paragraph 11, Special Provisions, to create their own termination rights or appraisal provisions.<\/p>\n

The rule permits certain changes specifically directed in writing by a principal, subject to its requirements. However, clients seeking unusual or customized contract terms should consult their attorney.<\/p>\n

Where Are Addenda Identified in the Contract?<\/h3>\n

Paragraph 22, Agreement of Parties, on page 9 of TREC Form 20-19 contains checkboxes identifying applicable addenda and notices.<\/p>\n

The forms are organized into categories covering financing, leases, additional testing, statutory disclosures, and other arrangements.<\/p>\n

Checking a box identifies a document intended to become part of the agreement. The parties should also confirm that the correct document has been completed, included, and executed as appropriate. A checked box should not be treated as a substitute for the actual addendum.<\/p>\n<\/section>\n

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Third Party Financing Addendum: TREC Form 40-11<\/h2>\n

When Is the Third Party Financing Addendum Used?<\/h3>\n

The Third Party Financing Addendum, TREC Form 40-11<\/a>, is used when financing from a third party will provide all or part of the purchase price under the terms described in the form.<\/p>\n

It includes financing selections for conventional mortgages, FHA-insured loans, VA-guaranteed loans, Texas Veterans Land Board loans, USDA-guaranteed loans, reverse mortgages, and other specified financing.<\/p>\n

The form establishes the proposed financing terms and requires the buyer to apply promptly and make reasonable efforts to obtain approval.<\/p>\n

The critical distinction is that TREC separates financing approval into Buyer Approval<\/strong> and Property Approval<\/strong>.<\/p>\n

Buyer Approval: Does the Buyer Qualify?<\/h3>\n

Buyer Approval concerns whether the lender is satisfied with the borrower’s qualifications and the terms of the proposed loan.<\/p>\n

Relevant factors include the buyer’s income, assets, credit history, and the availability of financing on the stated terms.<\/p>\n

Paragraph 2A allows the parties to select whether the contract is subject to Buyer Approval.<\/p>\n

If the contract is contingent on Buyer Approval, the buyer may terminate within the number of days inserted into the form after the effective date if approval cannot be obtained.<\/p>\n

The buyer must provide the seller with both a termination notice and a written lender statement explaining the lender’s determination. When the buyer properly terminates under this provision, the earnest money is refunded.<\/p>\n

If the buyer does not exercise the termination right within the stated period, the contract is no longer subject to obtaining Buyer Approval under Paragraph 2A.<\/p>\n

A mortgage preapproval letter does not independently replace the contractual requirements. Buyers should coordinate closely with their lender and agent before their deadline expires.<\/p>\n

Earnest money deadlines are separate from financing approval deadlines. See LRG Realty\u2019s guide to earnest money in Texas<\/a> for an explanation of the deposit and how contract termination rights affect it.<\/p>\n

Property Approval: Does the Property Qualify?<\/h3>\n

Property Approval concerns the lender’s underwriting requirements for the real estate itself.<\/p>\n

Paragraph 2B identifies appraisal, insurability, and lender-required repairs among the matters that may affect approval.<\/p>\n

If the lender determines that the property does not satisfy its underwriting requirements, the buyer may terminate on or before the third day before the closing date by delivering the required termination notice and written lender statement.<\/p>\n

A buyer who properly terminates under that provision receives a refund of earnest money.<\/p>\n

If the buyer does not terminate within the required period, Property Approval is deemed obtained under the addendum.<\/p>\n

For FHA or VA financing, Paragraph 4 contains additional federal financing provisions. These should be evaluated separately because the form expressly states that the Property Approval notice deadline does not apply to the protections contained in Paragraph 4.<\/p>\n

How Financing Addenda Differ From the Option Period<\/h3>\n

The financing addendum and option period establish separate contractual rights.<\/p>\n

The option period, when properly established under Paragraph 5 of the resale contract, grants an unrestricted termination right during the agreed period. Financing termination rights depend on the specific conditions and documentation required by the addendum.<\/p>\n

Read LRG Realty’s Texas option period guide<\/a> for the differences between inspection negotiations, termination notices, and financing contingencies.<\/p>\n<\/section>\n

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HOA Addendum: TREC Form 36-11<\/h2>\n

When Is the HOA Addendum Required?<\/h3>\n

The Addendum for Property Subject to Mandatory Membership in a Property Owners Association, TREC Form 36-11<\/a>, addresses transactions involving required membership in a property owners association.<\/p>\n

TREC rules designate this as a mandatory-use form for its applicable transaction category. The resale contract also contains a separate notice concerning mandatory association membership.<\/p>\n

The addendum is not intended for condominium transactions. Condominiums have separate contract and resale disclosure procedures.<\/p>\n

For buyers considering homes in San Antonio, Austin, or Central Texas subdivisions, association documents may reveal restrictions and financial obligations that are not apparent during a property showing.<\/p>\n

What Is Included in the Subdivision Information?<\/h3>\n

The addendum defines subdivision information to include applicable restrictions, association bylaws and rules, and a resale certificate.<\/p>\n

The resale certificate provides information about the association’s financial and operational circumstances, including assessments and other matters identified under Texas Property Code Section 207.003.<\/p>\n

Buyers should review restrictions affecting property use, recurring assessments, pending financial obligations, and any information concerning association litigation or resale requirements.<\/p>\n

The addendum provides several elections concerning whether subdivision information must be supplied and who will obtain it.<\/p>\n

Who Orders the Resale Certificate and Pays the Fees?<\/h3>\n

Paragraph A allows the parties to select whether the seller or buyer obtains the subdivision information within an agreed period.<\/p>\n

Another election addresses information already received before contract execution. The buyer may require an updated resale certificate under the conditions stated in that selection.<\/p>\n

The form also allows a buyer to elect not to require delivery of the subdivision information.<\/p>\n

Paragraph C allocates association fees, deposits, reserves, and other transfer charges between the parties. The buyer pays charges up to the negotiated amount, with the seller paying any excess.<\/p>\n

The paragraph excludes certain recurring assessments and expenses addressed elsewhere in the contract. These distinctions matter when estimating closing costs.<\/p>\n

Can the Buyer Terminate After Reviewing HOA Documents?<\/h3>\n

Yes, but the available right depends on which election was selected.<\/p>\n

Under the seller-delivery option, the buyer may terminate within three days after receiving the subdivision information or before closing, whichever occurs first. Failure to receive the required information also creates a termination right under the form.<\/p>\n

Under the buyer-obtains-information election, a similar review period applies after actual or deemed receipt.<\/p>\n

The updated resale certificate election and the election declining delivery contain different consequences.<\/p>\n

Buyers should therefore review the selected box rather than assume every HOA transaction provides the same cancellation period.<\/p>\n<\/section>\n

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T-47, T-47.1, and the Survey Paragraph in Texas Contracts<\/h2>\n

What Is the Purpose of the Survey?<\/h3>\n

Paragraph 6C of the TREC resale contract addresses the property’s survey.<\/p>\n

A survey depicts the property boundaries and improvements and may identify matters relevant to the title company’s or lender’s requirements.<\/p>\n

The contract provides alternative arrangements for an existing survey or a new survey. The parties select one of these options and complete the applicable deadlines and payment elections.<\/p>\n

Unlike a typical contract addendum, the survey arrangement is contained in the main contract.<\/p>\n

What Is a T-47 Affidavit?<\/h3>\n

The T-47 is a Residential Real Property Affidavit issued by the Texas Department of Insurance.<\/p>\n

It accompanies an existing survey and provides information concerning changes or matters affecting the property since the survey was prepared.<\/p>\n

The seller’s affidavit does not replace the survey itself. The title company and buyer’s lender must determine whether the existing survey and accompanying documentation are acceptable.<\/p>\n

The Texas Department of Insurance also provides the T-47.1 Residential Real Property Declaration in Lieu of Affidavit. This alternative does not require notarization.<\/p>\n

Who Pays if a New Survey Is Required?<\/h3>\n

Paragraph 6C provides three options.<\/p>\n

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