September 2024
If you are a licensed real estate professional managing rental properties, understanding the requirements for clients' trust accounts and security deposit accounts is crucial to your success.
Opening clients' trust accounts
If you are a property manager, or a broker or principal broker managing rental real estate, you must:
- Open at least one clients' trust account, even if you're not currently receiving clients' funds.
- Open a separate clients' trust account for security deposits if you're holding them for owners and tenants.
A clients' trust account must be opened in a federally insured bank with at least on physical branch in Oregon.
A note about choosing a bank: Some banks will not open bank accounts that meet the requirements below. Research ahead of time and choose a bank that will meet your needs and the needs of a clients' trust account.
Naming clients' trust accounts
The name of your clients' trust account must include one of the following:
- Clients' Trust Account
- Client Trust Account
The name of your security deposit account must include one of the following:
- Clients' Trust Account – Security Deposits
- Client Trust Account SD
Authorized signers
You must be a signer on the clients' trust account. Employees or contractors can be a signer with written policies and delegations of authority in place. See
Oregon Administrative Rule (OAR) 863-25-0015 for more information.
Remember, property owners cannot be authorized signers.
You are ultimately responsible for supervising and controlling your clients' trust accounts, even if you delegate the day-to-day maintenance to someone else.
Notice of clients' trust account
You must have a bank representative sign a completed
Notice of Clients' Trust Account and Authorization to Examine form. Upload a copy of the completed form into eLicense.
Checks
Checks must include the account number and be pre-numbered or, if computer-generated, consecutively numbered.
Bank service charges and opening balances
Pay any bank fees or service charges related to a clients' trust account from your business operating account or have them billed directly to you. Fees and service charges include check orders, nonsufficient funds fees, monthly service charges, or minimum balance charges. Do not put your money into the clients' trust account to cover these costs.
You cannot deposit your money into a clients' trust account to open the account. If you open a clients' trust account before collecting owner funds, you must find a bank that will open the account with a $0 balance.
Keeping any of your or your business funds in a clients' trust account is called commingling. This places your clients' funds at risk and may result in disciplinary action against your license.
Reporting clients' trust accounts in eLicense
You have 10 business days to enter a new clients' trust account in eLicense.
For more information, refer to Oregon Revised Statute chapter 696 and OAR chapter 863 division 25, available at www.oregon.gov/rea/Pages/laws_rules.aspx.