Employment Agreements And Trust Accounts

No

The listing or buyer brokerage agreements do create agency relationships, but an agency relationship may exist without a listing or buyer broker agreement

Creates an agency relationship but does not call for compensation. It is not an employment agreement, but it doesn’t post the same fiduciary responsibilities on the licensee

Yes, with all the attached responsibility and liability

Must be clearly written

Set forth all material terms

Have definite beginning and ending date and be signed by all parties.

Can’t be assigned to another brokerage without client consent

Requires agents to determine if an exclusive relationship exist between a prospective client another realtor before developing a relationship with a client

State all material items

Be signed by all parties

Specify beginning and end dates

Contain cancellation provisions

Provide for the disposition of all money

Provide for the disposition of all interest earned

Specify type and frequency of status reports to the owner

State the amount and purpose of any money held for reserves

State the terms of compensation to the broker

Not be assigned to another licensee without the written consent of the other

Automatic renewals

Liquidated Damages

Employee Access to trust account

Cancellation fees

Requiring duel signatures on accounts

5 days- list of security obligations

35 days- reimbursement except monies needed to cover outstanding unpaid obligations

75 days- both final accounts payable and receivable lists, and final reconciliation

Yes, but many firms dont allow for it

Brokers in property management are required to have a trust account

Unless parties otherwise agree, brokers are required to place monies entrusted to the broker in either a neutral escrow depository in AZ or a trust fund account in an FDIC insured AZ institution

Vast majority of companies who only list and sell property do NOT maintain trust accounts for earnest money.

They instruct licensee to have the buyer make the earnest money check out to an escrow company.

If AARs Purchase Agreements are used, the earnest money does not have to be deposited until complete acceptance by all parties

Parties MAY agree that earnest money does not need to be deposited in trust account or escrow.

Many new homes builders call for it to be deposited in builders operating account.

If builder filed for bankruptcy, that money would likely be lost.

To protect buyer client, buyers agents on new homes might negotiate the deposit in escrow rather than builders operating account.

Must be in federally insured depository in this state

Must be made on itemized deposit slips

Complete records must be kept

Must be reconciled on a monthly basis

Must remove any interest earned on an annual basis

Broker must have under 3k of brokerages money in account

Commingling is mixing of broker or sales funds with clients

Conversion is spending other peoples money

-Must have descriptive title (ie TRUST ACCOUNT)

All deposits must be made within 3 banking days of receipt

- all financial records must be kept for at least three years after execution

-Accounts may be interest bearing

-Journals and ledgers must be maintained and reconciled monthly

-owner may not be a signer on brokers trust account

-if a broker deposit money directly to the clients personal account, Broker may not have access to the account