Opinion ID: 783128
Heading Depth: 3
Heading Rank: 1

Heading: The Regulations Governing Escrow Funds

Text: 36 The Truth-in-Leasing regulation regarding escrow funds provides: 37 (k) Escrow funds. If escrow funds are required, the lease shall specify: 38 . . . . 39 (2) The specific items to which the escrow fund can be applied. 40 . . . . 41 (6) The conditions the lessor must fulfill in order to have the escrow fund returned. At the time of the return of the escrow fund, the authorized carrier may deduct monies for those obligations incurred by the lessor which have been previously specified in the lease, and shall provide a final accounting to the lessor or all such final deductions made to the escrow fund. The lease shall further specify that in no event shall the escrow fund be returned later than 45 days from the date of termination. 42 49 C.F.R. § 376.12(k). 43 Escrow fund is defined as [m]oney deposited by the lessor with either a third party or the lessee to guarantee performance, to repay advances, to cover repair expenses, to handle claims, to handle license and State permit costs, and for any other purposes mutually agreed upon by the lessor and the lessee. § 376.2( l ). In other words, if the account is considered an escrow fund as defined above, the Amended Lease Agreement must: (1) specify what the funds held in escrow may be used for, § 376.12(k)(2); and (2) specify what items owed to Success at the termination or completion of the lease may be offset against any escrow funds to be returned to the Lessee, § 376.12(k)(6).