Florida Regulations 69O-186.008: Escrow Requirements
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(1) A title insurance agent or title insurer may not use, endanger, or encumber money held in trust without the permission of the owner of such money, given after full disclosure of the circumstances. Accordingly, except as hereinafter provided, a title insurance agent or title insurer may not disburse funds unless the funds are collected funds. For purposes of this provision, “”collected funds”” means funds deposited, finally settled and credited to the title insurance agent’s or title insurer’s trust account. Notwithstanding that a deposit made by a title insurance agent or title insurer to the trust account has not been finally settled and credited to the account, the title insurance agent or title insurer may disburse funds from the trust account in reliance on such deposits under any of the following circumstances:
(a) The deposit is made by a certified check, cashier’s check, or money order;
(b) The deposit is made by a check representing loan proceeds issued by a federally- or state-chartered bank, savings bank, savings and loan association, credit union, mortgage broker licensed under Florida Statutes Chapter 494, or other duly licensed or chartered lender;
(c) The deposit is made by a bank check, cashier’s check, official check, treasurer’s check, or other such official instrument issued by a bank, savings and loan association, or credit union when the instrument is drawn by the bank on itself, or on another bank whether or not the check is “”payable through”” or “”payable at”” a bank and the title insurance agent or title insurer has reasonable and prudent grounds to believe the instrument will clear and constitute collected funds in the title insurance agent’s or title insurer’s trust account within a reasonable period of time. Such instruments are considered by the Federal Reserve Board, under Federal Regulation CC, otherwise cited as 12 C.F.R. § 229, to be “”next day”” payable items. A check drawn by a corporation on a bank or a draft drawn by a corporation on itself whether or not the check or draft is “”payable at”” or “”payable through”” a bank and is not a “”next day”” payable item under Regulation CC unless the depository bank chooses to treat it as such, and may not be disbursed on until collected;
(d) The deposit is made by a check drawn on the trust account of a lawyer licensed to practice in the State of Florida or on the escrow or trust account of a real estate broker licensed under Florida Statutes Chapter 475, or on the account of a mortgage broker licensed under Florida Statutes Chapter 494, or on the escrow trust account of a title insurance agent or title insurer licensed under the Florida Insurance Code, when the title insurance agent or title insurer has a reasonable or prudent belief that the deposit will clear and constitute collected funds in the trust account within a reasonable period of time;
(e) The deposit is made by a check issued by the United States Government, the State of Florida or any agency or political subdivision of the State of Florida;
(f) The deposit is made by a check issued by an insurance company authorized to do business in the State of Florida and the title insurance agent or title insurer has a reasonable and prudent belief that the instrument will clear and constitute collected funds in the trust account within a reasonable period of time;
(g) The deposit is made by a personal check in an amount not to exceed $500 when the title insurance agent or title insurer has a reasonable and prudent belief that the instrument will clear and constitute collected funds in the trust account within a reasonable period of time.
(2) For purposes of this provision, disbursement of funds shall only be made on such negotiable instruments as enumerated above which contain the following elements:
(a) Are signed by the drawer; and,
(b) Contain an unconditional order to pay; and,
(c) Are payable on demand; and,
(d) Are payable to order or to bearer.
(3) Funds received by a licensed title insurance agent or insurer pursuant to a real estate closing transaction involving the issuance of a title insurance binder, commitment, policy of title insurance, or guaranty of title shall not be deposited or transferred to an interest-bearing trust account without the written consent of the buyer and seller.
(4) Funds received from depositors in excess of the insured amount must be deposited in a financial institution that has a rating not less than the minimum standards established by Government National Mortgage Association (GNMA).
Rulemaking Authority 624.308 FS. Law Implemented 624.307(1), 626.8473, 628.151 FS. History-New 6-25-86, Amended 2-26-90, Formerly 4-21.010, Amended 2-13-95, 1-27-02, Formerly 4-186.008.
Terms Used In Florida Regulations 69O-186.008
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
(b) The deposit is made by a check representing loan proceeds issued by a federally- or state-chartered bank, savings bank, savings and loan association, credit union, mortgage broker licensed under Florida Statutes Chapter 494, or other duly licensed or chartered lender;
(c) The deposit is made by a bank check, cashier’s check, official check, treasurer’s check, or other such official instrument issued by a bank, savings and loan association, or credit union when the instrument is drawn by the bank on itself, or on another bank whether or not the check is “”payable through”” or “”payable at”” a bank and the title insurance agent or title insurer has reasonable and prudent grounds to believe the instrument will clear and constitute collected funds in the title insurance agent’s or title insurer’s trust account within a reasonable period of time. Such instruments are considered by the Federal Reserve Board, under Federal Regulation CC, otherwise cited as 12 C.F.R. § 229, to be “”next day”” payable items. A check drawn by a corporation on a bank or a draft drawn by a corporation on itself whether or not the check or draft is “”payable at”” or “”payable through”” a bank and is not a “”next day”” payable item under Regulation CC unless the depository bank chooses to treat it as such, and may not be disbursed on until collected;
(d) The deposit is made by a check drawn on the trust account of a lawyer licensed to practice in the State of Florida or on the escrow or trust account of a real estate broker licensed under Florida Statutes Chapter 475, or on the account of a mortgage broker licensed under Florida Statutes Chapter 494, or on the escrow trust account of a title insurance agent or title insurer licensed under the Florida Insurance Code, when the title insurance agent or title insurer has a reasonable or prudent belief that the deposit will clear and constitute collected funds in the trust account within a reasonable period of time;
(e) The deposit is made by a check issued by the United States Government, the State of Florida or any agency or political subdivision of the State of Florida;
(f) The deposit is made by a check issued by an insurance company authorized to do business in the State of Florida and the title insurance agent or title insurer has a reasonable and prudent belief that the instrument will clear and constitute collected funds in the trust account within a reasonable period of time;
(g) The deposit is made by a personal check in an amount not to exceed $500 when the title insurance agent or title insurer has a reasonable and prudent belief that the instrument will clear and constitute collected funds in the trust account within a reasonable period of time.
(2) For purposes of this provision, disbursement of funds shall only be made on such negotiable instruments as enumerated above which contain the following elements:
(a) Are signed by the drawer; and,
(b) Contain an unconditional order to pay; and,
(c) Are payable on demand; and,
(d) Are payable to order or to bearer.
(3) Funds received by a licensed title insurance agent or insurer pursuant to a real estate closing transaction involving the issuance of a title insurance binder, commitment, policy of title insurance, or guaranty of title shall not be deposited or transferred to an interest-bearing trust account without the written consent of the buyer and seller.
(4) Funds received from depositors in excess of the insured amount must be deposited in a financial institution that has a rating not less than the minimum standards established by Government National Mortgage Association (GNMA).
Rulemaking Authority 624.308 FS. Law Implemented 624.307(1), 626.8473, 628.151 FS. History-New 6-25-86, Amended 2-26-90, Formerly 4-21.010, Amended 2-13-95, 1-27-02, Formerly 4-186.008.