Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

What is the primary document required for operating a real estate business in compliance with Texas regulations?

1. Training Manual

2. Client Agreement

3. Policy and Procedures Manual

4. Business Plan

The correct answer is: Policy and Procedures Manual

The primary document required for operating a real estate business in compliance with Texas regulations is the Policy and Procedures Manual. This manual establishes the operational framework of the brokerage, detailing procedures for various aspects of the business, including compliance with state laws, ethical standards, and best practices in real estate transactions. Having a comprehensive Policy and Procedures Manual ensures that all agents and employees understand their roles and obligations, which is crucial for legal compliance and to maintain the integrity of the real estate business. It serves as a reference to guide day-to-day operations and decision-making processes, helping to mitigate risks associated with non-compliance. While training manuals, client agreements, and business plans play important roles in a real estate business, they do not serve the overarching purpose of governance and operational consistency that a Policy and Procedures Manual provides.