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Escrow 2015

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Matthew Rathbun's 2 hour presentation for Virginia agents for handing residential real estate escrow.

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Escrow 2015

  1. 1. escrowProtecting Other People’s Money TheAgentTrainer.com | @MattRathbun Matthew Rathbun ABR, ABRM, AHWD, CDPE, CRB, CRS, ePRO, GREEN, GRI, SRES, SFR, SRS
  2. 2. TheAgentTrainer.com @MattRathbun Husband and Father Broker Thinks He’s Funnier Than He Is… He’s Been Around Disrupter
  3. 3. “Money is better than poverty, if only for financial reasons.” Woody Allen
  4. 4. Escrow Defined A bond, deed, or other document kept in the custody of a third party, taking effect only when a specified condition has been fulfilled.
  5. 5. Define “Value”
  6. 6. What Should I Offer?
  7. 7. Regulatory Review Maintenance of Escrow Accounts • Held by broker • Account marked “escrow” • Federally insured • Deposited until parties agree otherwise • Balance has to be sufficient at all times [18VAC135-20-180]
  8. 8. Regulatory Review Upon the ratification of a contract, earnest money deposits and down payments received by the principal broker or supervising broker or his associates must be placed in an escrow account by the end of the fifth business banking day following ratification, unless otherwise agreed to in writing by the parties to the transaction. [18VAC135-20-180]
  9. 9. Regulatory Review Disbursement of Funds • Parties must agree in writing or • Court Orders Disbursement or • Broker Discretion (30 Day Letter) or • Judicial Remedies [18VAC135-20-180]
  10. 10. Accepting any note, nonnegotiable instrument, or anything of value not readily negotiable, as a deposit on a contract, offer to purchase, or lease, without acknowledging its acceptance in the agreement;
  11. 11. Commingling the funds of any person by a principal or supervising broker or his employees or associates or any licensee with his own funds, or those of his corporation, firm, or association;
  12. 12. Failure to deposit escrow funds in an account or accounts designated to receive only such funds as required by subdivision A 1 of this section
  13. 13. Failure to have sufficient balances in an escrow account or accounts at all times for all funds that are designated to be held by the firm or sole proprietorship as required by this chapter
  14. 14. Failing, as principal broker, to report to the board within three business days instances where the principal broker reasonably believes the improper conduct of a licensee has caused noncompliance with this section.
  15. 15. Rental Escrow VRLTA Security Deposits [55-248.15:1] • Limited to no more than twice the monthly rent • Disbursement • Applied to Accrued rent • Cover damages to Landlord • Charges outlined in Rental Agreement • Landlord has 45 days to disbursement
  16. 16. Interest Interest Versus Non-Interest Bearing
  17. 17. Accounts Operating vs. Escrow
  18. 18. The principal broker shall maintain a bookkeeping or record keeping system which shall accurately and clearly disclose full compliance with the requirements outlined in this section. Accounting records which are in sufficient detail to provide necessary information to determine such compliance shall be maintained.
  19. 19. Delivery & Acceptance
  20. 20. 5Day Rule
  21. 21. When is EMD Due?
  22. 22. Contract Default
  23. 23. Negotiating Deposits
  24. 24. Release Mechanism
  25. 25. Negotiating Release
  26. 26. Case Studies
  27. 27. Questions?
  28. 28. Facebook.com/mattrathbun @mattrathbun matthew@cbeva.com YouTube.com/MattRathbun1 ThankYou

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