You may think you’re just being helpful, but if you’re not careful, your advice could fall outside the scope of your real estate license. The unauthorized practice of law can lead to complaints, lawsuits, or other consequences.

Here are five common scenarios to avoid. When in doubt, recommend your client speak with an attorney.

Writing Escalation Clauses

TREC rules prevent you from writing escalation clauses. TREC Rule 537.11(b)(5) says license holders may not “draft language defining or affecting the rights, obligations, or remedies of the principals in a real estate transaction, including escalation, appraisal, or other contingency clauses.” Clients who wish to add escalation clauses should work with a lawyer.

Adding Special Provisions

You can only use the Special Provisions paragraph in TREC contracts to complete contract blanks if more space is needed, disclose facts, and provide instructions. If a form or addendum has been approved by TREC for mandatory use, you must use that form rather than Special Provisions. You cannot add, delete, or modify anything in the contract that affects the rights, obligations, or remedies of the parties unless a party or a party’s attorney drafts the change.

Drafting Repair Language

Just like with Special Provisions, you cannot create language that affects the rights, obligations, or remedies of the parties in paragraph 7D(2) of TREC contracts or in a repair amendment. You may list the items in need of repair, but only a party or the party’s attorney can draft additional language creating or modifying the parties’ rights relating to completion of repairs, inspections, delivery of documentation, or termination of the contract.

Making Title Objections

Agents often call the Texas REALTORS® Legal Hotline asking how to make title objections under Paragraph 6D of TREC contracts. You shouldn’t advise on these matters—your clients or their attorney should make the objections after reviewing the title.

Giving Legal Advice

Just because you work with contracts does not mean you have expertise in all aspects of them. You can explain the meaning of various choices in the contract, but you should not give opinions on the legal effect of any contract. You also should not discuss the validity of title to real estate. Clients should direct those questions to an attorney. The contract terms must come from the parties involved or their attorneys, not you. You are also not qualified to answer questions about how to handle possible contract breaches.