Real Estate Definitions – Trust Accounts
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Greetings from the metropolis of Cedar Crest, NM
Hope all of you had a great Thanksgiving. I ate more than my share of heart-stopping food…then ate some more. I am in bad shape to say the least.
Also….on my way to the Big EP (El Paso, TX), my car broke down. I bought this lemon not too long ago and it has been the worst vehicle I have ever owned. I was warned too! But I ignored wisdom and bought a piece of crap. This vehicle was touted as the “safest SUV on the road.” I think it was the salesman who said that. Anyway….he proved to be correct….problem was that is was safe because it spent most of it’s life in the auto shop. I left that junker in Las Cruces, NM. Good-bye…good riddance. If you want to know what kind of car it was….send me an email and I will tell you. Hint…they are known for their safety…..but now I know why.
I still have my dependable 2001 Toyota Forerunner….the best car I have ever owned.
Anyway….
As an investor, knowing the “Real Estate Language” is key to early success. To be able to “talk turkey” with your agent, your lender, your investors, etc., knowing what the heck you are talking about will keep you in the game.
Here are a few terms regarding Trust Accounts to get you started….(these terms come straight out of a real estate law license manual):
1) Trust Account: A bank account set up by a broker (not agent) for the purpose of holding money specific to a real estate transaction i.e., earnest money.
2) Land Title Trust Acccounts: a pooled interest-bearing account subject to the land title trust fund act
3) Special Trust Account: a trust account bearing interest payable to a named party in the transaction
4) Property Management Trust Account: a trust account containing money of others derived from the management of leased or rental properties
Until next time……rob
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