A. Every real estate broker who maintains a trust or escrow account as required pursuant to the provisions of Paragraph (8) of Subsection A of Section 61-29-12 NMSA 1978 may maintain a pooled interest-bearing escrow account and may deposit all customer funds into that account except for:
(1) funds required to be deposited into a property management trust account under an express property management agreement; or
(2) funds required to be deposited into an interest-bearing account under an express agreement between the parties to a transaction and under which agreement provisions are made for the payment of interest to be earned on the funds deposited.
B. Every escrow closing agent that maintains a trust account or escrow account pursuant to the provisions of Section 58-22-20 NMSA 1978 shall maintain a pooled interest-bearing escrow account and shall deposit all customer funds into that account, except for funds required to be deposited into an interest-bearing account under an express agreement between the parties to a transaction and under which agreement provisions are made for the payment of interest to be earned on the funds deposited.
C. The interest earned on customer funds deposited in a pooled interest-bearing escrow account pursuant to the provisions of Subsection A or B of this section, net of any appropriate financial institution service charges and fees, shall be remitted monthly or quarterly from the financial institution in which the account is maintained to the fund. The account agreement between the depositor and the financial institution shall expressly provide for the required remittance of interest.
D. The provisions of this section do not relieve a real estate broker or escrow closing agent from any obligations under other laws to safeguard and account for funds in a pooled interest-bearing account.
E. The pooled interest-bearing escrow accounts authorized to be established pursuant to the provisions of this section shall be interest-bearing demand accounts from which withdrawals and transfers can be made without delay, subject only to any notice period the depository institution is required to observe by law or rule.
F. The trustee shall adopt rules to carry out the provisions of the Low-Income Housing Trust Act.
G. A person establishing and maintaining a pooled interest-bearing escrow account required by the provisions of Subsection A or B of this section is not required to make disclosure to a person whose funds are placed in the account of the disposition of interest earned on the account.
H. An escrow servicing agent shall not be required to establish and maintain a pooled interest-bearing escrow account pursuant to the provisions of Subsection A or B of this section.
I. A property manager shall not be required to establish and maintain a pooled interest-bearing escrow account pursuant to the provisions of Subsection A or B of this section.
J. Real estate brokers and escrow closing agents shall enroll and instruct participating financial institutions on how to establish a pooled interest-bearing escrow account and how to authorize remittance of accrued interest less service charges to the fund.
K. A real estate broker or an escrow closing agent shall not be required to establish and maintain a pooled interest-bearing escrow account pursuant to the provisions of Subsection A or B of this section if no financial institution in the community where the broker or agent maintains his principal place of business provides or offers that type of account.
History: Laws 1994, ch. 146, § 10; 1999, ch. 41, § 2; 2003, ch. 304, § 3.
ANNOTATIONSThe 2003 amendment, effective June 20, 2003, in Subsection A, inserted "Paragraph (8) of" following "the provisions of" and substituted "A" for "H" following "Subsection"; substituted "rule" for "regulation" at the end of Subsection E; and substituted "trustee" for "director of the division" following "The" in Subsection F.
The 1999 amendment, effective July 1, 1999, substituted "provisions" for "requirements" in the first sentence of Subsection C, substituted "authorized" for "required" in Subsection E, deleted former Subsection F, relating to the New Mexico real estate commission adopting and promulgating regulations regarding procedures and forms to be used in establishing and operating the accounts required pursuant to the provisions of Subsection A, and requiring the director of the division to do the same regarding accounts required pursuant to the provisions of Subsection B, and added Subsection F.