The NAR Settlement and Texas: What Changed for Agents

The settlement did not rewrite Texas licensing law. It changed covered MLS practice, while Texas later enacted a separate written-agreement statute. Keeping those two sources apart makes the exam concepts much easier to study.

What is the NAR settlement?

The NAR settlement resolved antitrust lawsuits claiming that National Association of Realtors rules inflated real estate commissions. NAR agreed to pay about $418 million and to change certain practices, effective August 17, 2024, without admitting wrongdoing. It is a legal settlement, not a statute.

The settlement and resulting NAR policies apply within their defined membership and MLS scope. They are not Texas statutes and are not TREC rules.

• It is a private legal settlement, approved by a court.
• It changed practice for covered NAR members, MLSs, and MLS Participants.
• It did not, by itself, change Texas licensing law.

Texas separately passed SB 1968, which is the statute a Texas exam candidate should study.

What changed on August 17, 2024

Two practice changes took effect: offers of compensation to a buyer's agent can no longer be published on the MLS, and an MLS participant working with a buyer must have a written buyer agreement before touring a home. Commissions remained negotiable.

The cleanest way to see it is before and after.

The written buyer agreement under the settlement must disclose the amount or rate of the agent's compensation and state conspicuously that broker fees are fully negotiable and not set by law.

NAR says the written agreement is required before touring a home, whether in person or on a live virtual tour. It is not required just to talk with an agent, attend an open house, or ask an agent about their services.

That is the NAR policy answer, not the complete Texas-law answer for every open house. Under Texas rules effective January 1, 2026, a host from the listing brokerage can show its own listing without a buyer agreement and must disclose that the host represents the owner. An outside host who does not represent the owner must provide IABS and enter the written agreement Section 1101.563 requires before showing the property, even if the visitor already has another broker. State law controls when it requires more than private MLS policy.

Compensation is negotiable and not set by law

The settlement reinforced a concept that was always true: real estate commissions are negotiable and are not set by law. This is the idea most likely to surface on your exam, framed as a general principle rather than as the settlement.

If you take one thing from the settlement into the exam room, take this. Commissions are negotiable. They never had a legal rate. The settlement made covered MLS buyer agreements state this in writing, but the principle is older than the settlement.

For how compensation, splits, and rebates work in Texas, see fee splitting, rebates, and compensation, and for how compensation agreements are enforced, see enforcing compensation agreements.

How this connects to Texas and SB 1968

The NAR settlement and Texas SB 1968 are separate things that point the same direction. The settlement is national practice for Realtors from August 17, 2024. SB 1968 is Texas law for all license holders, effective January 1, 2026, requiring a written agreement with residential buyers.

It is easy to blur the two, so keep them apart:

• The settlement is a private agreement reflected in NAR and MLS policy. It took effect August 17, 2024.
• SB 1968 is a Texas statute that binds all license holders, whether or not they are Realtors. It is effective January 1, 2026, and applies to residential buyers.
• The triggers differ slightly. The settlement ties the written agreement to touring a home. SB 1968 ties it to showing residential property, or making an offer if no property is shown.

A Texas license holder who is also subject to NAR and MLS policy must comply with that policy and Texas law. For the statutory detail, see SB 1968: the written buyer agreement rule, and for the broader exam picture, see what changed for the Texas exam in 2026.

Is the NAR settlement on the Texas exam?

Not as a named topic. The Texas exam tests licensing law and general real estate concepts, not a private settlement. What can appear is the underlying principle that commissions are negotiable and not set by law, and Texas written-agreement and agency rules.

This is where an honest answer helps you study efficiently. The Pearson VUE Texas content outline lists compensation and agency concepts, not the NAR settlement by name. You do not need to memorize the settlement amount, the case names, or the dates for the exam. You need the concepts the settlement happens to highlight:

1. Commissions are negotiable and not set by law.
2. Texas requires a written agreement in the residential-buyer situations covered by SB 1968.
3. The difference between a private settlement, a statute, and a TREC rule, because the exam tests law, not headlines.

Spend your study time on Texas agency law and compensation principles, not on the litigation history.

Common traps to avoid

The big mistakes are treating the settlement as a law, thinking commissions are now banned or capped, and assuming it applies to every license holder. It changed practice for Realtors and MLS participants, commissions remain negotiable, and the Texas statute is SB 1968.

Watch for these on the exam and in conversation:

• The settlement is not a law. Texas licensing law is set by TRELA and TREC rules, with SB 1968 as the relevant statute.
• Commissions were not banned or capped. They are negotiable, as they always were.
• It does not bind every license holder through the same source. NAR and MLS policy has a defined membership and participation scope; SB 1968 is Texas law for Texas license holders.
• "No compensation on the MLS" does not mean no compensation. It means the offer is negotiated off the MLS.

Frequently Asked Questions

For quick answers to every common Texas exam question, see the Texas real estate exam FAQ.

What did the NAR settlement change?

Effective August 17, 2024, offers of compensation to a buyer's agent can no longer be published on the MLS, and an MLS participant working with a buyer must have a written buyer agreement before touring a home. Commissions remained negotiable.

Is the NAR settlement a law?

No. It is a private legal settlement that changed NAR and MLS policy. It is not a statute or a TREC rule. In Texas, the related law is SB 1968.

Did the NAR settlement cap or ban commissions?

No. Commissions are negotiable and were never set by law. The settlement made covered MLS buyer agreements state this in writing, but it did not cap or ban anything.

How is the NAR settlement different from SB 1968?

The settlement led to NAR and MLS policy changes effective August 17, 2024. SB 1968 is a Texas statute effective January 1, 2026. A Texas license holder subject to those MLS policies must comply with both the applicable policy and Texas law.

Do I need to study the NAR settlement for the Texas exam?

Not as a named topic. Study the concepts it highlights instead: commissions are negotiable and not set by law, written buyer agreements under SB 1968, and the difference between a settlement, a statute, and a TREC rule.

Sources and Methodology

This article was reverified on July 29, 2026 against NAR's settlement FAQs and current MLS Policy Statement 8.13, the enrolled text of SB 1968, current TREC implementation guidance, and the current Pearson VUE Texas content outline. The August 17, 2024 practice changes come from the settlement and NAR policy. The Texas written-agreement requirement comes separately from Section 1101.563 of the Occupations Code. The page keeps those sources separate because private MLS policy and Texas licensing law are not interchangeable.

Official Source Links

• NAR: settlement facts and FAQs
• NAR: what the settlement means for buyers and sellers
• NAR MLS policy: compensation offers and written buyer agreements
• Pearson VUE Texas Real Estate content outlines
• Texas Legislature: SB 1968
• TREC: 2026 buyer and tenant representation changes
• TREC: Become a Real Estate Sales Agent

This post is educational content for Texas real estate sales agent candidates. It is not legal advice. For brokerage practice, confirm the current NAR and MLS policies, Texas statutes, TREC guidance, and your broker's procedures.