Seller and Buyer have decided to pay for closing costs 50/50. How do I put this on the TREC Form?
Don’t forget that agents are prohibited from practicing law or from going beyond the promulgated forms. See Texas administrative code title 22 part 23 chapter 537 rule 537.11. This prohibition can make a simple agreement a daunting task if it is not part of the standard TREC forms. In our experience, this question does not call for an interpretation or reproduction of the contract. The best way we have found for an agent to get this on the standard form is to check both boxes for Seller and Buyer whenever there is an expense at issue on the contract and then write in the Special Provisions “Notwithstanding anything to the contrary in this contract, Buyer and Seller to split closing costs”. Place “50/50” above the checked boxes and have both Buyer and Seller initial the change.
The other party is in default! Can my client terminate the contract and get earnest money?
The terms of the contract may grant your side the right to terminate a contract, however, that does not release the title company as escrow agent. Escrow Agents are not a party to the contract in the TREC forms. However, escrow agents do take on liability as a fiduciary in the transaction when they accept earnest money. This duty is to both sides equally. When there is a conflict over earnest money a title company will generally require a release from both sides. Under the terms of the standard TREC contract, once a party presents a written demand for termination and return of earnest money, the other must respond within 15 days. The title company will be released from liability for distribution of earnest money thereafter. However, if the other party does respond with a counter demand for the earnest money, the escrow agent will not be able to release the funds until the parties agree. The escrow agent may find it necessary to submit the money to interpleader if the parties can not come to an agreement and the parties will need to resolve the matter in court.