Property management accounts

1. When do you need a property management trust account?

A: Any broker who engages in the management of any property must have a property management trust account. All rents, security deposits, and other monies received by the broker in connection with the management of that property must be deposited in that trust account, unless otherwise agreed.

2. Do rents and security deposits I receive in connection with properties I manage have to be deposited in my trust account?

A: Yes. Because these funds are received in a fiduciary capacity they must be placed in a broker’s property management trust account. This requirement applies even if a broker only manages one property.

3. If I manage my own property should the rent and security deposit go into my property management trust account?

A: Only monies received on behalf of another person or entity should be placed in the brokerage trust account. You should not comingle your own monies with fiduciary funds that are deposited in your trust account.

4. If I manage rental property must tenant security deposits be deposited in my property management trust account?

A: Yes, unless the lease and property management agreement provide the security deposits will be paid directly to the owner.

5. What name must be used on my property management trust account?

A: Any property management trust account the broker maintains must include the broker’s name as it appears on his/her license and must be labeled as a “property management trust account”. This must appear on all checks, deposit tickets, etc.

6. Can a broker have more than one property management trust account, for example one for each owner?

A: Yes. Each account must contain the broker’s name as it appears on his/her license and must be designated as a “property management trust account”. Additional descriptive terms can be added to distinguish the accounts from one another (i.e. Breckenridge Apartment, John Jones Properties).

7. Must a property management trust account be non-interest bearing?

A: A property management trust account may be interest bearing with the interest being paid to the property owners on a pro rata basis unless the broker and owners agree otherwise.