Compilation of Rules and Regulations of the State of Georgia › Department 520 - GEORGIA REAL ESTATE COMMISSION › Chapter 520-1 - LICENSURE AND BROKERAGE › Rule 520-1-.08 - Managing Trust Accounts and Trust Funds

Current through Rules and Regulations filed through June 27, 2024
(1)
The Designated Trust or Escrow
			 Account.
(a) Brokers may maintain more
			 than one designated trust or escrow account. Brokers shall notify the
			 Commission of the name of the financial institution in which each account is
			 maintained and each account's name or number within one month of opening each
			 account.
(b) A licensee shall place
			 all cash, checks, or other items of value received by the licensee in a
			 brokerage capacity into the custody of the broker holding the licensee's
			 license as soon after receipt as is practicably possible.
(c) A licensee shall place all cash, checks,
			 or other items of value received by the licensee when the licensee is acting in
			 the capacity of principal in the sale of interests in real estate owned by such
			 licensee and all security deposits received on property owned by the licensee
			 into the custody of the broker holding the licensee's license or in a trust
			 account approved by that broker as soon after receipt as is practicably
			 possible.
(d) Unless otherwise
			 agreed to in writing by the party or parties at interest, the broker holding
			 such cash or checks shall promptly deposit said funds in a federally insured
			 account designated by the financial institution as a trust account and
			 registered with the Commission and shall make appropriate arrangement for the
			 safekeeping of any items of value received other than cash or checks. If the
			 broker elects to deposit any funds into an interest-bearing trust account, the
			 broker shall obtain the written agreement of the parties indicating to whom the
			 broker shall pay any interest earned on trust funds deposited into that
			 interest-bearing account prior to depositing those funds into such an account.
See also O.C.G.A. §§
										43-40-2,
				43-40-20,
				43-40-21, &
				43-40-25.
(e) A broker may maintain the broker's own
			 funds in a designated trust or escrow account only when they are clearly
			 identified as the broker's deposit and only for the following purposes:
1. If the financial institution in which the
			 account is maintained designates a specific minimum balance that must be
			 maintained in order to keep the account open, the broker may maintain that
			 amount in the account designated as the broker's funds.
2. If the financial institution in which the
			 account is maintained requires a service charge be paid for the account, the
			 broker may maintain in the account in the broker's name a reasonable amount to
			 cover that service charge. The broker may also maintain in the account in the
			 broker's name a reasonable amount sufficient to cover other occasional
			 financial institution charges and costs of maintaining the account including
			 but not limited to charges for blank checks and deposit slips and fees for
			 return of deposited checks which fail to clear.
3. A broker may allow commissions due the
			 broker that are being paid from funds of others held in the broker's designated
			 trust or escrow account to remain in the account provided that:
(i) the broker's accounting system for trust
			 or escrow accounts designates those commissions as the broker's funds and
			 properly accounts for them and
(ii)
			 each month the broker removes from the account any of the broker's funds that
			 exceed the minimum necessary to comply with subparagraph (a) or (b)
			 above.
4. Only checks
			 made payable to the broker may be used to withdraw monies designated as the
			 broker's funds from the designated trust or escrow account.