Broker
An individual or entity licensed by TREC to conduct real estate brokerage activities, who is responsible for the professional actions of all sponsored sales agents.
Exam Context & Texas Nuance
Broker
A real estate broker in Texas is licensed by the Texas Real Estate Commission (TREC) to negotiate transactions, represent clients, and run a brokerage firm. Under TREC rules, a sponsoring broker must supervise all sponsored sales agents and is responsible for their professional conduct.
Texas-Specific Nuance & Citation
According to TRELA §1101.557, a sponsoring broker must maintain written policies and procedures to ensure that their sponsored sales agents are competent to conduct transactions. Additionally, the broker must actively sponsor and authorize their activities to keep them in active status.
The Trap
Many candidates assume that sponsored sales agents can operate independently or receive direct commission payments from other brokers or clients. Under Texas law, a sales agent is strictly a sub-agent of their broker, and all client representation and transaction funds must flow through the sponsoring broker’s accounts.
Worked Example
A sponsored sales agent in San Antonio successfully closes a home resale. The client tries to write a check for the 3% commission directly to the sales agent. The sales agent must refuse, and the client must pay the sponsoring broker’s firm instead. The broker will then distribute the split to the agent.