Current through Reg. 50, No. 187; September 24, 2024
(1) A title
insurance agent or title insurer may not use, endanger, or encumber money held
in trust without the permission of the owner of such money, given after full
disclosure of the circumstances. Accordingly, except as hereinafter provided, a
title insurance agent or title insurer may not disburse funds unless the funds
are collected funds. For purposes of this provision, "collected funds" means
funds deposited, finally settled and credited to the title insurance agent's or
title insurer's trust account. Notwithstanding that a deposit made by a title
insurance agent or title insurer to the trust account has not been finally
settled and credited to the account, the title insurance agent or title insurer
may disburse funds from the trust account in reliance on such deposits under
any of the following circumstances:
(a) The
deposit is made by a certified check, cashier's check, or money
order;
(b) The deposit is made by a
check representing loan proceeds issued by a federally- or state-chartered
bank, savings bank, savings and loan association, credit union, mortgage broker
licensed under Chapter 494, F.S., or other duly licensed or chartered
lender;
(c) The deposit is made by
a bank check, cashier's check, official check, treasurer's check, or other such
official instrument issued by a bank, savings and loan association, or credit
union when the instrument is drawn by the bank on itself, or on another bank
whether or not the check is "payable through" or "payable at" a bank and the
title insurance agent or title insurer has reasonable and prudent grounds to
believe the instrument will clear and constitute collected funds in the title
insurance agent's or title insurer's trust account within a reasonable period
of time. Such instruments are considered by the Federal Reserve Board, under
Federal Regulation CC, otherwise cited as 12 C.F.R. 229, to be "next day"
payable items. A check drawn by a corporation on a bank or a draft drawn by a
corporation on itself whether or not the check or draft is "payable at" or
"payable through" a bank and is not a "next day" payable item under Regulation
CC unless the depository bank chooses to treat it as such, and may not be
disbursed on until collected;
(d)
The deposit is made by a check drawn on the trust account of a lawyer licensed
to practice in the State of Florida or on the escrow or trust account of a real
estate broker licensed under Chapter 475, F.S., or on the account of a mortgage
broker licensed under Chapter 494, F.S., or on the escrow trust account of a
title insurance agent or title insurer licensed under the Florida Insurance
Code, when the title insurance agent or title insurer has a reasonable or
prudent belief that the deposit will clear and constitute collected funds in
the trust account within a reasonable period of time;
(e) The deposit is made by a check issued by
the United States Government, the State of Florida or any agency or political
subdivision of the State of Florida;
(f) The deposit is made by a check issued by
an insurance company authorized to do business in the State of Florida and the
title insurance agent or title insurer has a reasonable and prudent belief that
the instrument will clear and constitute collected funds in the trust account
within a reasonable period of time;
(g) The deposit is made by a personal check
in an amount not to exceed $500 when the title insurance agent or title insurer
has a reasonable and prudent belief that the instrument will clear and
constitute collected funds in the trust account within a reasonable period of
time.
(2) For purposes of
this provision, disbursement of funds shall only be made on such negotiable
instruments as enumerated above which contain the following elements:
(a) Are signed by the drawer; and,
(b) Contain an unconditional order to pay;
and,
(c) Are payable on demand;
and,
(d) Are payable to order or to
bearer.
(3) Funds
received by a licensed title insurance agent or insurer pursuant to a real
estate closing transaction involving the issuance of a title insurance binder,
commitment, policy of title insurance, or guaranty of title shall not be
deposited or transferred to an interest-bearing trust account without the
written consent of the buyer and seller.
(4) Funds received from depositors in excess
of the insured amount must be deposited in a financial institution that has a
rating not less than the minimum standards established by Government National
Mortgage Association (GNMA).
Rulemaking Authority 624.308 FS. Law Implemented
624.307(1), 626.8473, 628.151 FS.
New 6-25-86, Amended 2-26-90, Formerly 4-21.010, Amended
2-13-95, 1-27-02, Formerly 4-186.008.
