The Texas earnest money contract PDF is published free by the Texas Real Estate Commission as the One to Four Family Residential Contract (Resale), TREC Form 20-18, effective January 3, 2025.1Texas Real Estate Commission. Contracts Download it from trec.texas.gov, read every paragraph before you write anything, and fill it out in order. The form governs almost every resale home sale in Texas, and the way you complete it decides what happens to the earnest money if the deal closes or falls apart.
Where to Download the PDF
Go directly to the Texas Real Estate Commission’s contracts page at trec.texas.gov. The current resale form is TREC No. 20-18. TREC also publishes separate PDFs for condominiums, new construction, farm and ranch property, and unimproved land, so pick the one that matches your transaction. The resale form covers most single-family homes.
Licensed agents in Texas are generally required to use these TREC-promulgated forms under the Texas Occupations Code, though a property owner can substitute a form drafted by themselves or their attorney.2State of Texas. Texas Occupations Code 1101.155 – Rules Relating to Contract Forms If you are working without an agent, pulling the PDF straight from TREC is the safest way to be sure you have the current authorized version. TREC itself warns that mistakes in using the forms “may result in financial loss or a contract which is unenforceable.”1Texas Real Estate Commission. Contracts
What You Need Before You Start Typing
Have these in front of you before you open the PDF:
- Full legal names of both buyer and seller, exactly as they appear on government-issued ID. Title work depends on this.
- The property’s legal description: lot, block, and addition as recorded on the county plat. Pull it from the most recent property tax statement or the previous deed. A street address alone is not enough, and a wrong legal description can block closing.
- The agreed purchase price and how it will be paid: cash at closing, third-party financing, seller financing, or a combination.
- The option fee amount and the number of days in the option period, both negotiated with the seller.
- The earnest money amount, typically one to three percent of the purchase price.
- The name and address of the escrow agent (usually the title company) that will hold the funds.
Filling In the Price and What Stays With the House
Paragraph 3 breaks the purchase price into components: total price, financed amount, any seller financing, and cash due at closing. The numbers must add up. If you are using a conventional mortgage or any other third-party loan, you will also attach a financing addendum spelling out the loan terms.
The form addresses what conveys with the property. Built-in items such as appliances, light fixtures, and wall-to-wall carpeting are generally included automatically. For anything ambiguous, write it in. Items the seller plans to take with them go in the exclusions field. Items the buyer specifically wants included, such as a mounted television or a backyard storage building, go in the accessories field. Fights over what was supposed to stay are one of the most common post-closing problems, and a few extra lines of text now will prevent them.
Earnest Money and Option Fee Are Not the Same Thing
The PDF has separate fields for two separate payments. Confusing them is the single most common mistake buyers make.
Earnest money is the larger deposit, typically one to three percent of the purchase price. It signals the buyer is serious, it sits in escrow, and it gets applied toward the buyer’s closing costs or down payment if the sale closes. If the buyer defaults without a contractual right to terminate, the seller may keep it.
The option fee is a smaller, negotiated amount that buys the buyer an unrestricted right to walk away during the option period. Since 2021 it is delivered to the seller through the escrow agent. It is never refundable, even if the buyer uses the option to terminate. Money the escrow agent receives is applied first to the option fee, then to the earnest money.3Texas Real Estate Research Center. Option Period Basics
Both figures must be written into the contract, and both must be delivered within the same window.
What the Option Period Actually Gets You
During the option period, the buyer can terminate for any reason and get the earnest money back. “Any reason” means exactly that: inspection problems, cold feet, a better house down the street. No justification required. To use the right, the buyer must deliver written notice of termination to the seller by 5:00 p.m. local time on the last day of the option period. Miss that clock and the right is gone. The buyer also loses the unrestricted termination right entirely if the option fee is not delivered on time.3Texas Real Estate Research Center. Option Period Basics This is when most buyers schedule the home inspection.
Delivery Deadlines After Signing
The buyer must deliver both the earnest money and the option fee to the escrow agent within three days after the effective date of the contract.4Texas Real Estate Research Center. Option Period Basics – Section: Where and When is the Option Fee Delivered? The effective date is the date filled in on the last page once the final party (or their broker) signs. Every performance deadline in the contract runs from that date, so make sure it is written in correctly.
Days are counted as calendar days, not business days, starting the day after the effective date. One exception: if the deadline falls on a Saturday, Sunday, or legal holiday, it extends to the end of the next day that is not a Saturday, Sunday, or legal holiday.5Texas Real Estate Commission. Changes to Delivery of Option Fee Delivery means the title company has the check or wire in hand, not that it was mailed.
When the escrow agent receives the funds, they sign the receipt on the contract. Keep a copy of that receipted PDF. If the buyer misses the deadline, the seller gains the right to terminate. This is one of the fastest ways to lose a deal.
Disclosures and Addenda to Attach
Seller’s Disclosure Notice
Texas law requires the seller to give the buyer a written disclosure of the property’s known condition on or before the effective date of the contract. It covers structural components, roof, plumbing, electrical, and known defects. The seller can mark items as unknown and still comply. If the seller never provides the disclosure, the buyer may terminate for any reason within seven days of finally receiving it.6State of Texas. Texas Property Code 5.008 – Sellers Disclosure of Property Condition
Some transfers are exempt, including foreclosure sales, transfers by a bankruptcy trustee, sales between co-owners, and transfers to a spouse or family member in the seller’s direct line of descent.6State of Texas. Texas Property Code 5.008 – Sellers Disclosure of Property Condition
Lead-Based Paint Disclosure
For any home built before 1978, federal law adds a required addendum. The seller must disclose any known lead-based paint hazards, provide any available records and reports, and give the buyer an EPA-approved lead hazard pamphlet. The buyer also gets a 10-day window to conduct a lead paint inspection, which can be waived in writing.7eCFR. 24 CFR Part 35 Subpart A – Disclosure of Known Lead-Based Paint and Lead-Based Paint Hazards Upon Sale or Lease of Residential Property TREC publishes the matching addendum (Form OP-L), and it must be attached before the buyer is obligated to purchase.1Texas Real Estate Commission. Contracts
Other Addenda You May Need
The base PDF rarely stands alone. TREC publishes a library of addenda that attach to it, and most sales involve at least one. The common ones:
- Third Party Financing Addendum, when the buyer is getting a mortgage.
- Addendum Concerning Right to Terminate Due to Lender’s Appraisal (Form 49-1), which lets the buyer back out and recover the earnest money if the property appraises below the purchase price and the parties cannot agree on new terms.
- Addendum for Property Subject to Mandatory Membership in a Property Owners Association (Form 36-10), required for homes in an HOA.
- Addendum for Sale of Other Property by Buyer, when the buyer needs to sell their current home first.
- Seller Financing Addendum (Form 26-8), when the seller is carrying part of the price.
The main contract has a list of addenda with checkboxes. Every box you check must correspond to an actual signed addendum attached to the PDF. A reference without an attachment creates ambiguity that can unravel the deal.1Texas Real Estate Commission. Contracts
What the Contract Says Happens If Someone Backs Out
Paragraph 15 covers default, and the options are not symmetric. If the buyer defaults, the seller can pursue specific performance in court to force the buyer to close, or terminate the contract and keep the earnest money as liquidated damages. Taking the earnest money releases both parties from the contract. If the seller defaults, the buyer can pursue specific performance to force the sale, or terminate and get the earnest money back; the buyer does not receive extra liquidated damages, but keeps the right to seek other legal relief.8National Investors Title Insurance Company. Real Estate Earnest Money Contract Issues
Read Paragraph 15 before you sign, not after. The dollar amount you write in the earnest money field is, in practical terms, the price of changing your mind outside the option period.