Texas Buyer Agency Agreement: 2026 Guide, Costs & Rights

Texas homebuyers face a fundamental shift in how they work with real estate agents starting January 1, 2026. Under new state law (Senate Bill 1968), you’ll need to sign a written buyer agency agreement before an agent can show you properties or provide representation services. This change affects every home purchase in Texas—from your first showing to closing day.

Here’s what matters most: You now control your agent relationship through a written contract that defines services, compensation, and obligations before touring homes. This transparency protects you, but the agreements themselves contain complex clauses that can cost thousands if you don’t understand them.

This guide walks you through everything Texas buyers need to know about buyer agency agreements in 2026, including mandatory requirements, hidden cost traps, negotiation strategies, and how to avoid common mistakes that lead to unexpected fees.

Texas Buyer Agency Agreement in 60 Seconds

What changed in 2026: You must sign a written agreement before showings

Biggest risk to buyers: Paying $7K–$12K out of pocket

Two options: Full representation or showing-only

One rule to follow: Never sign without capping your agent’s fee

One budget tip: Assume you pay the commission yourself

Who This Guide Is For

This guide is for:

First-time Texas buyers
Buyers worried about surprise fees
New construction buyers
VA loan buyers
Real estate investors
Anyone navigating the 2026 Texas buyer agency agreement changes

What Is a Texas Buyer Agency Agreement?

A Texas buyer agency agreement is a legally binding contract between you (the homebuyer) and a real estate agent or brokerage that establishes a formal representation relationship. The agreement defines what services your agent will provide, how much you’ll pay them, and under what conditions you owe compensation.

Plain English version:
A buyer agency agreement is a contract that says: “This agent works for me, and here’s exactly what I’ll pay them.”

Under Texas Occupations Code Section 1101.558, this written agreement must be signed before your agent shows you properties or provides substantial buyer representation services. The Texas Real Estate Commission (TREC) enforces this requirement, and violations can result in license discipline for agents.

The agreement transforms your relationship from casual browsing to contractual obligation. Once signed, you typically commit to working exclusively with that agent for a specified time period and geographic area, and you agree to pay their commission according to terms outlined in the contract.

Texas SB 1968: What Changed for Buyers in 2026

Senate Bill 1968, effective January 1, 2026, made written buyer agency agreements mandatory in Texas for the first time. SB 1968 aligns Texas with national changes triggered by the August 2024 NAR settlement, which required clearer disclosure and separation of buyer and seller compensation.

While Texas has required written agreements since the early 2000s under certain circumstances, the new law eliminates exceptions and creates uniform requirements statewide.

Key Changes Under SB 1968

Mandatory Written Agreements: Agents must obtain signed buyer representation agreements or showing-only agreements before providing services. Verbal agreements no longer satisfy legal requirements (Texas Occupations Code §1101.558).

Two Agreement Types: Buyers can choose between full representation agreements (where the agent acts as your fiduciary) or showing-only agreements (where the agent merely facilitates property tours without advisory duties).

Timing Requirements: The agreement must be signed before the first property showing. Exceptions exist only for open houses and certain initial consultations, according to TREC guidance issued in December 2025.

Compensation Transparency: All agreements must clearly state how the agent will be compensated, including specific dollar amounts or percentages, and whether buyers or sellers pay the commission.

Buyer Representation Agreement vs. Showing-Only Agreement: Which Do You Need?

Texas law now offers two distinct contract options, each with different service levels and obligations.

At-a-Glance Comparison (Summary)

Full representation = advice, negotiation, fiduciary duty
Showing-only = access, no advice, no advocacy

Full Buyer Representation Agreement

A buyer representation agreement (TREC Form TXR-1501) establishes a fiduciary relationship where your agent owes you loyalty, disclosure, confidentiality, and advocacy throughout the home buying process.

Services provided include property searching, market analysis, negotiation strategy, contract review, and coordination with lenders, inspectors, and title companies through closing. You’re typically committed to exclusivity—you cannot work with other agents during the contract period without potential liability for commissions.

Showing-Only Agreement

A showing-only agreement permits an agent to show you properties without providing advice, negotiation help, or fiduciary duties. The agent can unlock doors and answer factual questions about property features, but cannot advise on offer strategy, market conditions, or contract terms.

This option works best for experienced buyers who don’t need negotiation help or those already working with attorneys. Most first-time buyers should opt for full representation. The cost difference rarely justifies sacrificing professional guidance on transactions averaging $350,000 to $450,000 in major Texas markets (according to Texas A&M Real Estate Center, Q4 2025 data).

What Must Be Included in a Texas Buyer Agency Agreement

Texas Occupations Code §1101.558 mandates specific disclosures in every buyer agency agreement. TREC enforces these requirements, and missing elements can void the contract.

Mandatory Contract Elements

Services Description: Clear explanation of what the agent will do for you (property searches, showings, offer preparation, negotiation, closing coordination).

Compensation Terms: Exact commission amount or percentage, who pays it (buyer, seller, or split), and when payment is due.

Contract Duration: Specific start and end dates for the agreement term, typically 90 to 180 days.

Geographic Scope: The area where the agreement applies (city, county, or specific ZIP codes).

Termination Provisions: Conditions under which either party can cancel the agreement and any associated penalties.

Holdover Period: Time after termination during which you may still owe commission if you purchase properties the agent showed you (typically 30 to 90 days).

Brokerage Disclosure: The name and license information of the agent and their sponsoring broker.

Standard TREC and Texas REALTORS® buyer representation forms span seven or more single-spaced pages. A University at Buffalo School of Law study (August 2024, Professor Tanya Monestier) identified ten major contractual issues in buyer representation agreements that typically favor agents over buyers, with Texas forms ranking among the most complex analyzed.

How Much Do Buyer Agents Cost in Texas?

Texas buyer agent commissions averaged 2.5% to 3% of the purchase price before the NAR settlement, according to Houston Association of REALTORS market data through mid-2024. Post-settlement rates have declined slightly but remain substantial.

What Most Buyers Actually Pay in 2026

Conservative estimate: 2.0%–2.5%
Risk range: $7,000 to $12,000
Worst case: Builder bonus clauses can push this higher

Current Market Rate Structures

Based on Texas A&M Real Estate Center transaction data through Q4 2025:

Typical buyer agent commission: 2% to 2.5% of purchase price
Alternative structures emerging:

Flat fees: $5,000 to $15,000 depending on price range
Hourly rates: $150 to $300 per hour for limited services
Hybrid models: Lower percentage plus minimum fee

On a $400,000 home purchase (near the Texas median for metro areas), expect buyer agent compensation of $8,000 to $10,000 if paying 2% to 2.5%.

Who Actually Pays?

Three common scenarios:

Seller pays through concession: The seller agrees during negotiation to credit the buyer agent commission at closing. This was standard pre-settlement and remains common in 2026, though not guaranteed.
Buyer pays out-of-pocket: If the seller refuses to offer a buyer agent concession, you’ll need liquid funds at closing to pay your agent according to your agreement terms.
Split payment: Some transactions split the commission, with sellers covering a portion and buyers paying the difference.

Your buyer agency agreement obligates you to pay your agent regardless of whether the seller agrees to a concession. If you sign an agreement promising 2.5% commission and the seller offers no concession, you owe the full amount from your own funds.

This creates significant affordability challenges, particularly for first-time buyers already stretching to cover down payment and closing costs. On a $400,000 purchase, a 2.5% buyer agent fee equals $10,000 you must have available beyond your down payment if the seller won’t contribute.

Texas-Specific Commission Traps and Hidden Escalation Clauses

Texas buyer representation agreements contain provisions that can substantially increase your costs beyond the stated commission rate.

Before You Sign, Check for These 5 Red Flags

✓ Escalation clauses (TXR-1505)
✓ Long holdover periods (over 30 days)
✓ Uncapped builder bonuses
✓ Vague termination language
✓ Broad geographic scope

Amendment Escalation Clauses

Texas REALTORS® Form TXR-1505 and similar brokerage-specific forms include amendment provisions allowing agents to increase fees if sellers or builders offer bonuses exceeding your agreed compensation.

How it works: You sign an agreement promising your agent 2.5% ($10,000 on a $400,000 home). During negotiation, the seller offers a 3% buyer agent concession ($12,000). Your agent can amend the agreement to capture the full $12,000, increasing their compensation by $2,000.

Training materials from Texas brokerages explicitly instruct agents to use these clauses to maximize earnings when sellers or builders offer bonuses. This appears inconsistent with the spirit of the NAR settlement, which mandated decoupling buyer and seller agent compensation to enable true negotiation.

Builder Bonus Capture

New construction buyers face particularly aggressive bonus structures. Builders in Houston, Dallas, and Austin markets commonly offer buyer agent bonuses ranging from $5,000 to 8% of purchase price, according to 2025 market reports from Metrotext MLS and HAR.com.

On a $500,000 new construction home, an 8% builder bonus equals $40,000—far above the 2.5% ($12,500) you might have negotiated. Buyer agency agreements often include provisions requiring you to pay your agent any builder-offered bonuses even if they exceed your negotiated rate.

Failed Transaction Commission Liability

Texas buyer representation agreements typically require you to pay full commission even if the transaction fails due to buyer breach. These clauses create double-penalty exposure: You lose your earnest money (typically 1% to 2% of purchase price) and you owe your agent full agreed commission.

On a $400,000 purchase, this could mean losing $8,000 in earnest money plus owing $10,000 in agent commission—$18,000 total for a failed deal.

Can You Negotiate Buyer Agent Fees in Texas?

Yes. Despite agents often presenting 2.5% to 3% as standard, Texas law does not set commission rates, and the NAR settlement specifically enables commission negotiation.

What to Say to Agents (Copy-Paste)

“I’m happy to sign, but I need three options:

Percentage
Flat fee
Hourly

And I need your fee capped in writing.”

Negotiation Strategies That Work

Request multiple commission structures: Ask agents to quote percentage-based, flat fee, and hourly rate options. This reveals flexibility and helps you compare true costs.

Negotiate before signing: Once you’ve signed a buyer agency agreement, your negotiating power disappears. Discuss commission before committing.

Use market competition: Interview multiple agents and let them know you’re comparing fee structures. Texas has approximately 150,000 active real estate licensees as of 2025 (per TREC data), creating competitive pressure.

Consider limited service agreements: If you need minimal help, negotiate for specific services only at hourly rates rather than full representation.

Many brokerages maintain internal minimum commission policies (typically 2% to 2.5%), but they’re negotiable when pressed. Discount brokerages and flat-fee services like Redefy and Trelora operate in Texas offering $5,000 to $7,500 flat fees regardless of purchase price.

How Seller Concessions Interact With Texas Buyer Agency Agreements

TREC updated Paragraph 12 of standard purchase contracts (Forms 1-4T) in January 2025 to clarify compensation crediting. The new language specifies:

If a seller agrees to a buyer agent concession, those funds credit toward your buyer agency agreement obligation. You only pay out-of-pocket if the seller concession falls short of your agreed commission.

Example:
Your buyer agency agreement obligates you to pay your agent $10,000 (2.5% on $400,000 purchase). The seller agrees to a $12,000 buyer agent concession. Your agent receives $10,000 from closing, and the excess $2,000 credits to your side of the closing statement, reducing your cash-to-close by $2,000.

However, if your buyer representation agreement contains escalation clauses, your agent may amend the agreement to capture the full $12,000, eliminating your benefit.

Worst-Case Cash Needed at Closing (Realistic Planning)

When planning your home purchase budget, assume you’ll pay your buyer agent commission entirely out-of-pocket. On a $400,000 purchase with 10% down, budget approximately:

$40,000 down payment
$8,000 to $20,000 closing costs
$8,000 to $10,000 buyer agent commission
$3,000 additional fees and reserves
Total: $59,000 to $73,000 in liquid assets needed

Many first-time buyers focus only on down payment and closing costs, then face shock when sellers refuse buyer agent concessions.

Texas Buyer Agency Agreement: 10 Essential FAQs

Do I have to pay my buyer agent if the seller won’t offer a concession?

Yes. In Texas, if the seller won’t pay, you must pay your buyer agent according to your signed agreement. Your buyer representation agreement creates a binding obligation to pay your agent according to the terms you signed, regardless of whether sellers contribute. Budget for this by having liquid assets available beyond your down payment and standard closing costs. On Texas median-priced homes ($350,000 to $450,000 in major metros), expect to need $7,000 to $11,250 if paying 2% to 2.5% commission out-of-pocket.

What happens if I breach the buyer agency agreement after signing?

Yes, you likely owe full commission plus lose your earnest money. Texas buyer representation agreements typically contain provisions requiring commission payment if transactions fail due to buyer default. Example: On a $500,000 home with $10,000 earnest money and 2.5% buyer agent commission ($12,500), backing out without valid contingency means losing $10,000 to the seller and owing your agent $12,500—totaling $22,500 in losses.

Can my agent increase fees after I sign the buyer representation agreement?

No, according to NAR settlement rules, but Texas brokerages exploit amendment provisions that allow fee increases when sellers or builders offer bonuses exceeding your initially agreed commission. Protect yourself by explicitly crossing out escalation clauses before signing and specifying that your agent’s compensation is capped at the agreed amount.

How do seller concessions credit against my buyer agency agreement?

According to TREC’s January 2025 updates, seller-offered buyer agent concessions credit directly toward your buyer representation agreement obligation. You only pay additional commission out-of-pocket if the seller concession falls short. If the seller offers more than your agreed commission, the excess should credit to your closing costs (unless escalation clauses allow your agent to capture it).

What are holdover periods in Texas buyer agency agreements?

Holdover periods extend your commission obligations 30 to 90 days after your buyer representation agreement terminates. You owe commission if you purchase properties within this window that your agent “called to your attention” during the active agreement. Protect yourself by maintaining detailed records of properties your agent showed you and negotiating shorter holdover periods (30 days maximum) before signing.

Can I negotiate buyer agent commission rates in Texas?

Yes, absolutely. Texas law prohibits fixed commission rates, and the NAR settlement explicitly enables commission negotiation. Request quotes from multiple agents for different fee structures. Alternative structures include flat fees ($5,000 to $15,000), hourly rates ($150 to $300 per hour), and hybrid models. Never accept the first commission structure an agent proposes.

How do I work with builders offering buyer agent bonuses?

New construction transactions frequently involve builder bonuses ranging from $5,000 to 8% of purchase price. Your buyer representation agreement determines who receives these bonuses. Negotiate bonus treatment before signing: cap your agent’s compensation at the agreed rate and credit excess bonuses to your closing costs, or split bonuses above agreed commission amounts.

Should I sign a buyer agency agreement at an open house?

No, generally you should not sign at an open house. Texas law creates an open house exception—agents can show you open house properties without requiring a buyer representation agreement first. Use open houses to interview agents without contractual obligations. You’re never obligated to sign on the spot, and agents claiming otherwise violate Texas regulations.

Can I see homes without signing a buyer agreement in Texas?

Yes, at open houses. Otherwise, agents must have a signed agreement before private showings. Texas law (SB 1968) requires written agreements before agents provide substantial services or show properties outside of open houses. You can attend open houses freely without any contractual commitment, making them ideal for initial property research and agent interviews.

What should I do if I can’t afford buyer agent commission out-of-pocket?

Negotiate seller concessions aggressively in every offer using Paragraph 12 of standard Texas purchase contracts. Choose properties where sellers are motivated (longer days-on-market, estate sales, relocations). Interview agents offering flat-fee services ($5,000 to $7,500) or hourly rates. Consider using showing-only agreements initially, then converting to full representation only when ready to make offers.

Key Takeaways: Navigate Texas Buyer Agency Agreements Successfully

Texas’s mandatory buyer agency agreement requirement starting January 2026 fundamentally changes homebuying dynamics. You now control agent relationships through explicit written contracts, but those agreements contain complex clauses that can cost thousands if you don’t protect yourself.

Four critical actions every Texas buyer must take:

Read every word before signing. Texas buyer representation agreements span seven or more pages with provisions on commission escalation, holdover periods, and failed transaction liability. Review the actual contract language.
Negotiate commission rates and cap escalation clauses. Request multiple structure quotes, interview competing agents, and explicitly limit your agent’s ability to increase compensation through amendments when sellers offer bonuses.
Budget for worst-case scenarios. Assume you’ll pay buyer agent commission entirely out-of-pocket (2% to 2.5% of purchase price). On median Texas homes, this means having an extra $7,000 to $11,000 available beyond down payment and closing costs.
Protect yourself during termination. If you switch agents, track properties your former agent showed you and avoid them during the 30- to 90-day holdover period to prevent competing commission claims.

Your Next Step

Before touring any home:

✓ Ask for sample agreements
✓ Compare fee structures
✓ Cap escalation clauses
✓ If unsure, spend 1 hour with a real estate attorney

The hour you invest reviewing contracts before signing can save you thousands of dollars.

For official guidance on Texas buyer representation requirements, visit the Texas Real Estate Commission at trec.texas.gov. This article provides educational information only and does not constitute legal advice.