Reading TREC 20-17 Clause by Clause as a Texas FSBO Seller

If you are selling your Bexar County house without a listing agent, the buyer's agent will almost certainly hand you the TREC One to Four Family Residential Contract (Resale) — currently designated 20-17 — with a stack of addenda. You need to read it like the buyer's agent read it: paragraph by paragraph, knowing where the money moves, where the clock starts, and where a single blank box shifts thousands of dollars onto your side of the settlement statement.

This is a clause-level walkthrough from the seller's perspective. The paragraph numbers match the current promulgated form on the TREC website. If the buyer's agent sends you a contract with paragraphs renumbered or language rewritten in Paragraph 11, stop and get a Texas real estate attorney on the phone before you sign.

Paragraphs 1–4: Parties, Property, Sales Price, License Disclosure

Paragraph 1 names Seller and Buyer. If the deed says "John Smith and Jane Smith" as spouses, both sign — a homestead in Texas cannot be conveyed by one spouse alone, even if only one name is on the mortgage. If the property is in an LLC or a trust, the entity name goes here and the signature block needs the authorized signer's title.

Paragraph 2 is the legal description. Copy it verbatim from your deed or the BCAD record — lot, block, subdivision, recording reference. "123 Oak St" is not a legal description. Paragraph 2 also lists accessories (garage door remotes, keys, mounted TVs, etc.). If your Ring doorbell stays, write it in. If the washer and dryer do not convey, strike them.

Paragraph 3 is the Sales Price: 3A cash from buyer at closing, 3B financed portion, 3C total. 3D is where financing terms tie back to the Third Party Financing Addendum (TREC 40-11). If 3B is non-zero and the financing addendum is not attached, the buyer has no contractual financing contingency — good for you, rare in practice.

Paragraph 4 is the License Holder Disclosure. As an unrepresented FSBO seller, you check that you are not a license holder. If you are a licensed Texas agent selling your own home, you must disclose it here and in the listing.

Paragraph 5: Earnest Money and Termination Option

This is the money paragraph. In the current version, earnest money and the option fee are combined into Paragraph 5. Four numbers matter:

• Earnest money: held by the title company. In San Antonio, 1% of sales price is the common floor; on hot listings sellers push for more. On a $350,000 house, $3,500 is light; $5,000–$7,000 signals a serious buyer.
• Additional earnest money and the date it must be delivered (often tied to the end of the option period).
• Option fee: paid directly to Seller, non-refundable, buys the unrestricted right to terminate during the option period. Typical range in Bexar County is $200–$500 depending on price point and market heat.
• Option period: the number of days. 7 days is standard; 10 is generous; 3–5 is a seller-favorable counter.

If Paragraph 5 says the option fee is $0 or the option period is blank, the buyer has no option to terminate for any reason — verify that was intentional, not a typo.

Paragraph 6: Title Policy and Survey

6A: who pays for the Owner's Title Policy. In South Texas custom, Seller pays. If the buyer's agent checked "Buyer," that is a negotiation win worth roughly 0.5–0.9% of sales price depending on the title company's rate card — do not give it back without thinking.

6C is the survey. Three options: (1) Seller delivers an existing survey plus a signed Residential Real Property Affidavit (T-47) within a stated number of days, (2) Seller obtains a new survey, (3) Buyer obtains a new survey. If you have a usable survey from when you bought the house and nothing material has changed (no new fence, pool, addition), check option 1. A new survey in Bexar County runs roughly $450–$650.

6D is objections. The buyer has a fixed window after receiving the commitment, survey, and exception documents to object to title. Track this deadline — if they miss it, objections are waived.

Paragraph 7: Property Condition

7A acknowledges inspections. 7B is the Seller's Disclosure Notice — TREC OP-H or its statutory equivalent — required by Texas Property Code § 5.008. Deliver it before the contract is signed, not after. Late delivery gives the buyer a termination right.

7D is the accept-the-property clause. The default FSBO move is 7D(1): "accepts the Property As Is." Anything in 7D(2) (specific repairs the seller agrees to before closing) is a commitment you will have to perform or credit at closing.

7E references lead-based paint — if the home was built before 1978, you must attach the Lead-Based Paint Addendum (TREC OP-L) and give the buyer the EPA pamphlet. This is federal, not optional.

Paragraph 8: Broker's Fees

As an FSBO, you have no listing agreement. If the buyer is represented and you agreed to pay their agent a commission, that agreement is a separate Registration/Commission Agreement with that brokerage — not Paragraph 8. Paragraph 8 on 20-17 essentially references outside commission agreements. Get the commission agreement in writing before you accept the offer, not at closing when the title company asks for instructions.

Paragraphs 9–10: Closing and Possession

Paragraph 9 sets the closing date. Build in enough time for the buyer's lender — 30–35 days from effective date is realistic for conventional financing in the current underwriting environment; VA and FHA often need 35–45.

Paragraph 10 is possession: at closing and funding, or per a Temporary Lease (TREC 15-6 for seller's leaseback up to 90 days, 16-6 for buyer's early possession). Do not hand over keys before funding without a signed temporary lease — you are then a landlord under Chapter 92 of the Property Code.

Paragraph 11: Special Provisions — the trap

Paragraph 11 is for factual business details the promulgated form does not cover. It is not a place to draft contract language. TREC rules prohibit license holders from practicing law here, and courts have invalidated clauses added by non-lawyers. If the buyer's agent has written a paragraph of legal prose in 11 — indemnities, repair escrows, exotic contingencies — that is your signal to route the contract through a Texas real estate attorney. An hour of attorney time at $300–$450 is cheap compared to a malformed clause.

Paragraphs 12–13: Expenses and Prorations

Paragraph 12 enumerates seller expenses (owner's title policy if 6A-1, tax statements, release of existing liens, half of escrow fee by custom) and buyer expenses. 12A(1)(b) caps seller-paid buyer expenses — the "seller concessions" number. If the buyer wrote in $8,000 and you missed it, you just gave back $8,000.

Paragraph 13 prorates taxes to the closing date. Bexar County tax bills arrive in October and are due January 31; at a July closing, the title company estimates and prorates using the prior year's bill unless you specify the current certified value. Rollback taxes (ag or wildlife exemption recapture) get addressed here — rare inside Loop 1604, common on acreage in north Bexar or Comal County.

Paragraph 15: Default

If the buyer defaults, Seller may (a) enforce specific performance, or (b) terminate and receive the earnest money as liquidated damages. If the Seller defaults, Buyer may enforce specific performance or terminate and recover earnest money plus, in some cases, damages. Specific performance — a court ordering you to convey — is a real remedy in Texas. Do not sign a second contract on the same house because you think the first buyer is wobbling.

What most people get wrong

• Leaving Paragraph 5 option terms blank and assuming "standard." There is no standard. Blank means zero. Fill every box.
• Checking 6A-2 (Buyer pays title policy) without noticing. In Bexar County, seller typically pays. Confirm the box matches what you negotiated.
• Delivering the Seller's Disclosure after the contract is signed. Texas Property Code § 5.008 requires it on or before the effective date. Late delivery = buyer termination right for 7 days.
• Treating Paragraph 11 as a free-text zone. Legal language belongs in an addendum drafted or reviewed by a Texas real estate attorney, not in Paragraph 11.
• Forgetting the commission agreement with the buyer's broker. If you verbally agreed to pay 2.5%, get it on a signed Registration Agreement before you sign the contract — title companies will not disburse based on a handshake.
• Letting the buyer move in before funding without a TREC 16-6 lease. The moment they have keys and it is past closing, you are a landlord with every obligation in Chapter 92.

Before you sign

Read every paragraph out loud once. Compare the boxes checked to what you and the buyer's agent actually discussed. If anything in Paragraphs 5, 6, 7D, 11, or 12 looks unfamiliar, pause and call a Texas real estate attorney — a 30-minute consult is cheaper than a bad closing.

When you are ready to put the house in front of buyers, you can list your home FSBO on RentInSA at /list-your-home at no cost, or if you decide mid-way that you want a pro, browse vetted local agents at /agents. More FSBO resources, including addenda checklists and a Bexar County closing-cost worksheet, live at /resources.