Free National / General study sheet
Contracts and Agency Texas Real Estate Exam Cheat Sheet
Quick answerThis is the largest national content area. It tests how contracts are formed, classified, performed, breached, and ended, plus how agency relationships begin and what a license holder owes each party.
Source-checked National / General portion
Use the national rule unless the question identifies Texas law or a TREC form. The 16-item weight belongs to the National / General portion. Texas-specific recall cards below are bridges to the separate state portion.
Name the legal status before choosing the remedy. A contract question becomes easier once you identify whether the agreement is valid, void, voidable, unenforceable, executed, or executory.
Exam scope
What Pearson tests
Verified against the official content outline.
- Contract types, required elements, electronic signatures, and the Statute of Frauds
- Offer, counteroffer, contingencies, earnest money, breach, damages, rescission, and termination
- Creation and termination of agency, client duties, customer duties, and disclosure
Decision traps
Common traps to catch
Check the governing source material.
- A void contract never had legal effect. A voidable contract is valid until the protected party avoids it. Lack of capacity does not settle it on its own: unadjudicated incapacity is voidable, adjudicated incompetence is void.
- Writing is not a fifth element of a valid contract. Under Section 26.01(a) an unwritten real estate contract is valid but unenforceable, which is why the exam calls an oral land deal unenforceable rather than void.
- An executed contract has been fully performed. An executory contract still has duties left to perform.
- Agency duties depend on the relationship and the party. Do not give a customer the same duties owed to a client.
Essential vocabulary
Contracts and Agency terms to know
- Valid contract
- An agreement that has every required legal element and can be enforced.
- Mutual assent
- Agreement created by a valid offer and an unqualified acceptance.
- Consideration
- Something of legal value exchanged by the parties.
- Bilateral contract
- A promise exchanged for another promise.
- Executory contract
- A contract with one or more duties still left to perform.
- Statute of Frauds
- The rule requiring specified agreements, including a sale of real estate, to be in writing and signed by the person to be charged.
- Fiduciary duties
- The duties an agent owes a client, including loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care.
- Novation
- Substitution of a new party or obligation with the required agreement, releasing the replaced party or duty.
Check your recall
Can you answer these without notes?
Open each card only after you commit to an answer.
1What are the four essential elements of a valid contract?
Competent parties, mutual assent, consideration, and a lawful purpose. Writing is not one of them.
2Is a minor's contract void or voidable?
Voidable, and the minor chooses. A contract with a person a court has adjudicated incompetent is void.
3What separates a bilateral contract from a unilateral contract?
A bilateral contract exchanges promises. A unilateral contract exchanges a promise for performance.
4In TREC No. 20-19 Paragraph 15, what changes between a buyer default and a seller default?
Three words. The earnest money goes to the seller 'as liquidated damages' on a buyer default. On a seller default the buyer just receives it back.
5What must a Texas broker do if they agree to represent both sides?
Act as an intermediary. TRELA Section 1101.561(b) leaves no other option, which is how Texas rules out dual agency without ever using the phrase.
6Who receives fiduciary duties?
The client. A customer receives honesty, fair dealing, and required disclosures, but not the full client-level fiduciary relationship.
7Can a client instruct an agent to stay quiet about a defect?
No. Section 1101.651(d)(3)(C) excepts information that materially relates to the condition of the property, so confidentiality never shields a defect.
8When must a written agreement with a residential buyer be signed in Texas?
Before showing any residential property, or before presenting an offer if none is shown. TRELA Section 1101.563, effective January 1, 2026.
9Which two Statute of Frauds clauses does this exam test?
Section 26.01(b)(4), a contract for the sale of real estate, and Section 26.01(b)(5), a lease for a term longer than one year.
10Is an unenforceable contract automatically void?
No. It may be valid but unavailable as a court-enforced remedy because of a legal defense.
11Does an electronic signature satisfy the Statute of Frauds?
Yes. Sections 322.007(c) and (d) make an electronic record satisfy a writing requirement and an electronic signature satisfy a signature requirement.
12Which TREC paragraphs say time is of the essence?
Paragraph 5E of TREC No. 20-19, Paragraph 2 of the Third Party Financing Addendum, and Paragraph E of the Addendum for Sale of Other Property by Buyer. Paragraph 9, closing, does not.
13When does a buyer have no option period even though the days blank is filled in?
When no dollar amount is stated as the option fee, or the fee is delivered late. TREC No. 20-19 Paragraph 5D removes the unrestricted right to terminate in either case.
14Is the option fee credited to the sales price?
Yes, unconditionally, under Paragraph 5A(4). Only an additional option fee paid to extend the option period carries a will or will-not checkbox, at box (7) of Amendment TREC No. 39-11.
15Does a failed financing contingency protect a buyer who does nothing?
No. TREC No. 40-11 Paragraph 2A requires a notice of termination plus the lender's written statement. Miss it and the contract is no longer subject to Buyer Approval.
Use the sheet, then retrieve
Turn recognition into recall.
Read the full lesson when a definition is fuzzy. Then answer the topic questions without looking back at this sheet.
Primary sources
Checked .
- Pearson VUE Texas Real Estate Content Outlines
- Texas Business & Commerce Code Chapter 26, Statute of Frauds
- Texas Business & Commerce Code Chapter 322, electronic transactions
- Texas Occupations Code Chapter 1101, The Real Estate License Act
- TREC Rules, including Chapters 535 and 537
- TREC No. 20-19, One to Four Family Residential Contract (Resale), effective July 1, 2026
- TREC current contracts and addenda
This is exam-prep education, not legal, tax, or transaction advice. Confirm the current law, form, and official exam materials before relying on a rule in practice.