1. Download the slides now: https://www. texasrealestate
Download the slides now: The Property Management Webinar Series Presents The TAR Property Management Agreement Instructed by Abby Lee, Associate Counsel May 21, 2014

2. Outline
Introduction
License Requirement
The Agreement
Questions

3. Introduction
The Texas Association of REALTORS® Residential Leasing and Property Management Agreement (TAR form 2201) is available for member’s use and is accessible one of two ways:
ZipForms
(the ‘Blank Form Downloads’ page)

4. License Requirement
Remember, the Texas Real Estate Commission (TREC) requires a person to be licensed, if that person, on behalf of another:
Leases,
Offers to lease,
Negotiates or attempts to negotiate the lease of real estate,
Lists or offers to list real estate for lease,
Aids or attempts to aid in locating or obtaining real estate for lease,
Procures or assists in procuring a prospect to effect the lease of real estate,
Procures or assists in procuring property to effect the lease of real estate, or
Controls the acceptance or deposit of rent from a resident of a single-family residential real property unit.
AND does so in exchange for, or with expectation of receiving, a commission or other valuable consideration. 4

5. The Agreement 5

6. Frequently Asked Question
I’m the property manager, but I’m not a broker. Should I fill in my name as broker in paragraph 1 of the agreement? 6

7. Frequently Asked Question
No. If you are an agent and not the broker, you should not include your name and information in paragraph 1 of the agreement. You may, however, be entitled to sign the agreement on behalf of the broker if authorized by your broker to do so. 7

8. Frequently Asked Question
I’m the property manager, but the owner of the property doesn’t want to put his information in paragraph 1 of the TAR Residential Lease. Can I use my name instead? 8

9. Frequently Asked Question
No. Unless you actually are the owner of the property, you should not insert your name in paragraph 1 as the owner. The Texas Property Code defines “landlord” as the owner, lessor, or sublessor of a dwelling, but does not include a manager or agent of the landlord unless the manager or agent purports to be the owner, lessor, or sublessor in an oral or written lease. Throughout the Property Code, the “landlord” has many obligations and failure to comply with those obligations could lead to liability. Therefore, if you insert your name in paragraph 1 of the TAR Residential Lease, you could open yourself up to liability.
Additionally, Texas Property Code § requires that a landlord disclose to a tenant the name and either a street or post office box address of the holder of record title (owner). Disclosure can be made by including the information in a copy of the tenant's lease or in written rules given to the tenant before the tenant requests the information. 9

10. The Agreement 10

11. Frequently Asked Question
An owner I’m working with has several properties she wants me to manage. Do I need to fill out a property management agreement for each one? 11

12. Frequently Asked Question
No. As Paragraph 2 of the TAR Residential Leasing and Property Management Agreement states, you can attach the TAR Multiple Property Addendum (TAR form 2204) instead of executing multiple agreements with the same owner for different properties. 12

13. The Agreement 13

14. Frequently Asked Question
A friend of mine is working with a different property manager and is using the TAR Residential Leasing and Property Management Agreement. He is unhappy and wants to terminate. Can he terminate? 14

15. Frequently Asked Question
First, you must take care to avoid interfering with an exclusive agency relationship, as that could have legal and ethical repercussions. However, in general, to terminate the agreement, the broker and owner may mutually agree to terminate. Alternatively, the owner may unilaterally terminate the agreement before its expiration, but risks being sued by the broker for breach of contract. The only other option is for the owner to provide notice of termination upon the expiration date at least 30 days before the expiration date. 15

16. Frequently Asked Question
The owner of a property I manage has died. Am I still the property manager for the property? 16

17. Frequently Asked Question
No. However, according to Paragraph 22.C of the Residential Leasing and Property Management Agreement states that “Owner’s obligation to pay Broker an earned fee is binding upon Owner and Owner’s heirs, administrators, executors, successors, and permitted assignees.” 17

18. The Agreement 18

19. The Agreement 19

20. Frequently Asked Question
The owner wants me to handle the eviction suit of a tenant who has violated the lease by keeping an unauthorized pet on the property without permission. Can I do so? 20

21. Frequently Asked Question
No. The Texas Property Code § states that “in eviction suits in justice court for nonpayment of rent or holding over beyond a rental term, the parties may represent themselves or be represented by their authorized agents, who need not be attorneys.” The Property Code, however, does not authorize nonlawyer representation for issues other than nonpayment of rent or holding over, except in default judgment situations. 21

22. The Agreement 22

23. Frequently Asked Questions
I was managing a property, and the owner terminated the management agreement by providing proper notice. A tenant in the property previously notified us that he will not renew the lease. The lease ends 30 days from today. I have the security deposit in my trust account. What do I do with the security deposit? 23

24. Frequently Asked Questions
According to Paragraph 4.C of the TAR Residential Leasing and Property Management Agreement, since you are no longer the landlord's agent, you should forward the security deposit to the landlord. You are able to deduct amounts authorized prior to returning the security deposit to the landlord. and remind him he has a duty to account for the deposit when the tenant vacates the property.
You should send TAR form 2210 Notice to Tenant of Change in Management and Accountability for Security Deposits to the tenant advising him that you are no longer the agent for the landlord, that you tendered the security deposit to the landlord and the exact dollar amount, the landlord’s contact information ,and that the landlord is responsible to account to the tenant for the security deposit. 24

25. Frequently Asked Questions
Who is responsible for the return of the security deposit if the property owner sells the property? 25

26. Frequently Asked Questions
Under the provisions of Section of the Texas Property Code, the seller and the buyer may be liable for the security deposit and any refund of the deposit to the tenant upon termination of the rental. The new owner is liable for the return of the security deposit from the date he acquires the property. However, the seller also remains liable for the security deposit he received from the tenant until the buyer delivers to the tenant a signed statement acknowledging that the buyer is the new owner and has received and is now responsible for the tenant's security deposit.
The transfer of the security deposit upon closing is specifically addressed in the One to Four Family Residential Contract (Resale) in Paragraph 9B(5). Most title companies have security-deposit transfer letters that can be signed by the buyer and the seller at closing to inform the tenant of the sale and security deposit transfer. TAR form 2210, Notice to Tenant of Change in Management and Accountability for Security Deposit, could also be used for this purpose with a few obvious changes.
Note: Section of the Texas Property Code does not apply to a real estate mortgage lienholder who acquires title by foreclosure. 26

27. The Agreement 27

28. The Agreement 28

29. The Agreement 29

30. The Agreement 30

31. Frequently Asked Question
I am the property manager of a property which the owner now wants to sell. Could the owner list with another broker for sale of the property during the term of our property management agreement that is still in effect? 31

32. Frequently Asked Question
Yes. There is nothing in the TAR Residential Leasing and Property Management Agreement that would prohibit the owner from listing the property for sale with another broker after the execution of the property management agreement. However, depending on the circumstances, the broker may still be entitled to some compensation. 32

33. The Agreement 33

34. The Agreement 34

35. The Agreement 35

36. The Agreement 36

37. The Agreement 37

38. Frequently Asked Questions
Is the broker permitted to keep the interest earned on the security deposits held in a trust account? 38

39. Frequently Asked Questions
Yes. Paragraph 11(E) of the Residential Leasing and Property Management Agreement (TAR form 2201) allows the broker to retain any interest or income from an interest-bearing or income producing account.
Note: The broker must remove an interest or income payable from the trust account not later than the 30th day after the interest or income is paid. TREC Rule § (j). 39

40. The Agreement 40

41. The Agreement 41

42. The Agreement 42

43. The Agreement 43

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45. The Agreement 45

46. The Agreement 46

47. The Agreement 47

48. The Agreement 48

49. The Agreement 49

50. The Agreement 50

51. List of PM Forms
Residential Leasing and Property Management Agreement (TAR 2201)
Multiple Property Addendum (TAR 2204)
Addendum for Authorization to Act for Owner Before Owners’ Association (TAR 2205)
Owner’s Notice Concerning Condition of Property under Property Management Agreement (TAR 2206)
Property Manager’s Inventory and Condition Report (TAR 2207)
Notice Terminating Right of Occupancy (TAR 2208)
Late Notice or Notice of Other Breach of Lease (TAR 2209)
Notice to Tenant of Change in Management and Accountability for Security Deposit (TAR 2210)
Agreement to Pay Past Due Amounts Under Lease (TAR 2213)
Report of Incident Occurring on Property (TAR 2215)
Itemization of Security Deposit (TAR 2216)
Notice of Landlord’s Intent Not to Renew (TAR 2217)
General Information for Tenant of Property Facing Foreclosure (TAR 2220)
Amendment to Residential Leasing and Property Management Agreement (TAR 2221)
Notice of Termination of Residential Leasing and Property Management Agreement (TAR 2222) 51

52. The TAR Property Management Agreement
Questions 52

53. The TAR Property Management Agreement
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