Texas Real Estate Glossary: Terms Every DFW Buyer and Seller Sees
By Brent Reiter, REALTOR® · Last updated November 4, 2026
Texas real estate has its own vocabulary. Some words come from the state's standard contract, some from property tax law, and some from the North Texas MLS (NTREIS) that feeds home search sites. Here they are in plain English, grouped by where you'll run into them.
These are short, general definitions, not legal advice. Your contract controls, so ask your agent, lender or attorney how a term applies to your deal.
At a Glance
- Standard resale contract
- TREC One to Four Family Residential Contract (20-19)
- Option period deadline
- 5:00 p.m. local time
- Earnest money and option fee due
- Within 3 days after the Effective Date
- Homestead deadline
- April 30
- Under contract but still showing
- Active Option Contract, Active Contingent, Active Kick Out
Buying & Contracts
| Term | Meaning |
|---|---|
| TREC | The Texas Real Estate Commission. It licenses agents and inspectors and publishes the standard contract forms agents must use. |
| One to Four Family Residential Contract (Resale) | TREC's standard contract for buying an existing home. The current version is form 20-19. |
| Effective Date | The date the contract is fully signed and accepted by both sides. Most deadlines count from it. |
| Option period | The number of days, negotiated in the contract, when the buyer can terminate for any reason. Notice must be given by 5:00 p.m. local time on the last day. See the Texas option period. |
| Option fee | What the buyer pays the seller for the option period. Not refunded if the buyer terminates; credited to the price if the sale closes. |
| Termination notice | The written notice a buyer sends to end the contract, usually on a TREC form. |
| Amendment | A signed change to the contract, such as agreed repairs, a price change or a new closing date. |
| Third Party Financing Addendum | The addendum that describes the buyer's loan and when the buyer can terminate if the loan isn't approved. |
| Appraisal addendum | TREC's Addendum Concerning Right to Terminate Due to Lender's Appraisal. Spells out what happens if the appraisal comes in low. |
| Sale of other property addendum | Makes the contract depend on the buyer selling their current home. Listings with this show as Active Kick Out. |
| Back-up contract | A second contract that moves into first place if the first one terminates. |
| Seller's Disclosure Notice | The seller's written report of known property conditions required by Texas Property Code §5.008, with some exemptions. |
| Lead-based paint disclosure | A federal disclosure required for homes built before 1978, with an EPA pamphlet and up to 10 days for the buyer to test. |
| Seller's Water Disclosure | A disclosure in the current TREC contract about groundwater and surface water rights and limits. |
| "As Is" | In the TREC contract, the present condition with any defects. Accepting a home As Is doesn't stop the buyer from inspecting, negotiating repairs or terminating during the option period. |
| Lender required repairs | Repairs the lender requires before funding. Neither side must pay unless they agree; if they don't agree, the contract terminates. |
| Buyer representation agreement | The written agreement between you and your buyer's agent covering their duties and pay. |
| Information About Brokerage Services (IABS) | A TREC notice your agent gives you that explains the ways agents can represent you. |
| WDI report | A wood-destroying insect (termite) inspection report from a licensed pest control company. |
| Sewer scope | A camera inspection of the main sewer line. Often added on older homes. |
| Temporary residential lease | A TREC lease used when the buyer moves in before closing or the seller stays after. |
Money & Closing
| Term | Meaning |
|---|---|
| Earnest money | The buyer's good-faith deposit, delivered to the escrow agent within 3 days after the Effective Date. Applied first to the down payment at closing. |
| Additional earnest money | A second earnest money deposit due by a date set in the contract, if the parties agree to one. |
| Escrow agent | Usually the title company. Holds the earnest money and option fee and runs the closing. |
| Title commitment | The title company's promise to insure title, listing liens, easements and other exceptions. Due within 20 days after the title company gets the contract. |
| Exception documents | Copies of the restrictions, easements and other documents listed as exceptions in the title commitment. |
| Owner's title policy | Insurance that protects the buyer against covered title problems. The contract says whether seller or buyer pays. |
| Loan title policy | A separate title policy that protects the lender. The buyer pays for it. |
| Survey | A drawing by a registered surveyor showing boundaries, improvements and easements. |
| T-47 Affidavit / T-47.1 Declaration | Texas Department of Insurance forms where the seller states nothing has changed since the existing survey, so it may be reused. |
| Appraisal | The lender's independent estimate of the home's value. |
| Appraisal gap | The difference between the price and a lower appraised value, which the buyer may have to cover in cash. See appraisal gaps in DFW. |
| Seller contribution (concession) | Money the seller agrees to pay toward the buyer's costs. See seller concessions. |
| Closing costs | Fees beyond the price and down payment: lender, title, escrow, recording and prepaid items. See Texas closing costs. |
| Closing Disclosure | The lender's final statement of loan terms and costs, given at least three business days before closing. |
| Settlement statement | The title company's line-by-line list of every charge and credit for buyer and seller. |
| Prorations | Splitting costs like property taxes and HOA dues between buyer and seller by the closing date. |
| General warranty deed | The deed the seller signs at closing under the TREC contract, transferring title with the seller's warranty. |
| Funding | When the lender's money is released. Under the standard contract, the buyer gets possession at closing and funding. |
Taxes & Districts
| Term | Meaning |
|---|---|
| Appraisal district | The county office that sets taxable values and handles exemptions. Most of Fort Worth is in the Tarrant Appraisal District (TAD). |
| Tax rate per $100 | How Texas rates are written. A rate of 0.705650 means about $0.71 for every $100 of taxable value. |
| Homestead exemption | A reduction in taxable value for your primary home. The school district exemption is $140,000. Apply by April 30. See Fort Worth property taxes. |
| Homestead cap | With a homestead, taxable value can't rise more than 10% a year, plus new improvements. |
| Over-65 / disabled exemption | Added exemptions for owners 65 and older or disabled, plus a ceiling that freezes school taxes. |
| Protest | Your appeal of the appraisal district's value, usually due May 15 or 30 days after your notice, whichever is later. |
| MUD (Municipal Utility District) | A special district that funds water, sewer and drainage in many new communities and adds its own tax rate. Sellers must give a district notice. |
| PID (Public Improvement District) | A city or county district that charges an assessment to pay for infrastructure in a community. |
| HOA (property owners' association) | An association with mandatory membership, dues and rules. The TREC contract notes whether the home is in one. |
| Subdivision Information / resale certificate | HOA documents (restrictions, bylaws, rules and a resale certificate showing dues and lawsuits). Under the HOA addendum, a buyer who gets them after signing can terminate within 3 days of receiving them. |
| ISD | Independent School District. Fort Worth city limits include parts of more than a dozen. See Fort Worth school districts. |
Listing Statuses (NTREIS)
These are the statuses used by the North Texas MLS, as defined by MetroTex Association of REALTORS®. Home search sites sometimes relabel them, so a home marked "contingent" or "under contract" may be in any of the first few below.
| Status | Meaning |
|---|---|
| Active (ACT) | Available for sale and open to showings. |
| Active Option Contract (OPT) | The seller accepted an offer and the buyer is in the option period. Still open to showings and backup offers. |
| Active Contingent (CON) | The seller accepted an offer but still allows showings and will consider backup offers. |
| Active Kick Out (KO) | The offer depends on the buyer selling another property. Still open to showings and backup offers. |
| Pending (PND) | Under contract with no contingencies, kick-outs or options. The seller isn't taking showings or backup offers. |
| Closed (SLD) | The sale has closed. |
| Temp Off Market (TOM) | Still listed, but the owner isn't showing it for now (for example, during repairs or illness). |
| Withdrawn (WTH) | Taken off the market under a termination of listing with conditions; it can't be relisted with another broker. |
| Cancelled (CAN) | Taken off the market with no conditions; the seller can relist with another broker. |
| Expired (EXP) | The listing agreement ran out without a sale. |
Thinking about buying or selling in Fort Worth? I was born and raised here, and I help buyers and sellers across DFW from my office in the Mid-Cities. Call or text anytime, no pressure.
Brent Reiter, REALTOR®
Brent Sells DFW · 817-874-1602
Local Resources & Citations
- TREC One to Four Family Residential Contract (Resale), form 20-19 ↗
- TREC Addendum for Property Subject to Mandatory Membership in a Property Owners Association, form 36-11 ↗
- Texas Comptroller: property tax exemptions ↗
- Tarrant Appraisal District ↗
- MetroTex Association of REALTORS®: MLS status definitions ↗
- EPA lead-based paint disclosure rule ↗
Frequently Asked Questions
What does Active Option Contract mean in Texas?
The seller accepted an offer and the buyer is in the option period, when they can still terminate for any reason. The home is still open to showings and backup offers.
What's the difference between Active Contingent and Pending?
In NTREIS, Active Contingent means the seller accepted an offer but still allows showings and backup offers. Pending means the contract has no contingencies, kick-outs or options left, and the seller isn't taking showings or backup offers.
What does Active KO mean on a listing?
Active Kick Out: the seller accepted an offer that depends on the buyer selling another home. The seller can keep showing it and take backup offers.
What is the difference between earnest money and an option fee?
Earnest money is a deposit you get back if you terminate during the option period or under another contract right. The option fee pays for the option period and goes to the seller if you terminate; if you close, it's credited to the price.
What is a MUD in Texas real estate?
A Municipal Utility District, a special district that pays for water, sewer and drainage in many new communities and adds its own tax rate on top of the city, county and school district.