Each mortgage banker or mortgage broker shall maintain in this state one or more separate bank accounts that shall be designated a Clients’ Trust Account in which all trust funds received or handled by the mortgage banker or mortgage broker shall be deposited unless, pursuant to written agreement of all parties having an interest in the trust funds, the trust funds are immediately placed in a neutral escrow depository in this state.
Each mortgage banker or mortgage broker shall file with the Director of the Department of Consumer and Business Services, on forms approved by the director, a statement identifying the name of the bank or banks, account number or account numbers, and name of account or accounts for each Clients’ Trust Account maintained.
Each mortgage banker or mortgage broker shall authorize the director or an authorized representative of the director, on a form approved by the director, to examine any Clients’ Trust Account, by a duly authorized representative of the director. The examination shall be made at such times as the director may direct.
If a branch office maintains a separate Clients’ Trust Account, a separate bookkeeping system shall be maintained in the branch office, provided a copy of all documents evidencing payments into and from the Clients’ Trust Account is maintained in the main office of the mortgage banker or mortgage broker.
Trust funds received by a mortgage banker or mortgage broker may be placed by the mortgage banker or mortgage broker in a federally insured interest-bearing bank account, designated a Clients’ Trust Account, but only with the prior written approval of all parties having an interest in the trust funds. The earnings of such interest-bearing account shall not inure to the benefit of the mortgage banker or mortgage broker unless expressly approved in writing before deposit of the trust funds by all parties having an interest in the trust funds.
A mortgage banker or mortgage broker is not entitled to any part of any interest earnings on trust funds deposited under subsection (5) of this section or to any part of the earnest money or other money paid to the mortgage banker or mortgage broker in connection with any real estate transaction as part or all of the mortgage banker’s or mortgage broker’s commission or fee until the transaction has been completed or terminated. The question of the disposition of forfeited earnest money shall be negotiated between a mortgage banker or mortgage broker and a client at the time of executing any earnest money agreement. The result of such negotiation shall be filled in on the agreement form at the time of signing by the client and either separately initialed by the client or placed immediately above the signature of the client.
Clients’ Trust Account funds are not subject to execution or attachment on any claim against the mortgage banker or mortgage broker.
No person shall knowingly keep or cause to be kept any funds or money in any bank under the heading of Clients’ Trust Account or any other name designating such funds or money as belonging to the clients of any mortgage banker or mortgage broker, except actual trust funds deposited with the banker or broker.
The director may provide by rule for other records to be maintained and for the manner in which trust funds are deposited, held and disbursed. [Formerly 59.935]