The NAR Settlement and Texas: What Changed for Agents

The NAR settlement is the change that confuses candidates most, because people talk about it as if it rewrote the law. It did not. It is a private settlement that changed how agents practice, and Texas later codified a related rule. Here is the before and after, and the part that actually matters for your exam.

What is the NAR settlement?

Snippet answer: 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 binds NAR and its members and the multiple listing services that adopt the rule changes. It is not a Texas statute and not a TREC rule. That distinction is the whole key to understanding it.

• It is a private legal settlement, approved by a court.
• It changed industry practice for Realtors and MLS participants.
• It did not, by itself, change Texas licensing law.

So when someone says "the law changed," what they usually mean is that practice changed, and that Texas separately passed SB 1968.

What changed on August 17, 2024

Snippet answer: 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.

Compensation is negotiable and not set by law

Snippet answer: 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

Snippet answer: 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 that binds Realtors and MLS participants. 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.

So a Texas agent who is a Realtor follows both: the settlement practice rules and the SB 1968 statute. For the full statutory detail, see SB 1968: the written buyer agreement rule, and for the broader 2026 picture, see what changed for the Texas exam in 2026.

Is the NAR settlement on the Texas exam?

Snippet answer: 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. A written buyer agreement can be required before you work with a buyer, which in Texas is the SB 1968 rule.
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

Snippet answer: 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 agent the same way. The settlement reaches Realtors and MLS participants; SB 1968 reaches all 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 industry practice for the National Association of Realtors and MLS participants. 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 is national practice for Realtors, effective August 17, 2024. SB 1968 is a Texas statute for all license holders, effective January 1, 2026, that requires a written agreement with residential buyers. A Realtor in Texas follows both.

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 reviewed against National Association of Realtors settlement materials and Texas legislative sources on June 24, 2026. The practice changes, effective August 17, 2024, are that offers of compensation may not be published on a multiple listing service and that MLS participants working with a buyer must enter a written agreement before touring a home, with the agreement disclosing the agent's compensation and stating that broker fees are fully negotiable and not set by law. NAR agreed to pay about $418 million and did not admit wrongdoing. The settlement is a private legal settlement, not a statute or TREC rule. The Texas written-agreement requirement is set separately by SB 1968, effective January 1, 2026, under Section 1101.563 of the Occupations Code. Settlement terms and the resulting MLS rules can change, so verify the current NAR materials, TREC rules, and the statute before relying on details in practice.

Official Source Links

• NAR: settlement facts and FAQs
• NAR: what the settlement means for buyers and sellers
• Pearson VUE Texas Real Estate content outlines
• Texas Legislature: SB 1968
• TREC: Become a Real Estate Sales Agent

This post is educational content for Texas real estate sales agent candidates. It is not legal advice. The NAR settlement is industry practice rather than Texas licensing law, and settlement rules, TREC rules, and statutes can change, so confirm current NAR, TREC, and statutory sources before relying on any detail in practice. Exam content can change, so verify against current Pearson VUE and TREC sources before you test.