[Broker’s Authority and Duties – Trust Account Rules] When submitting an offer, a buyer handed their broker an earnest money deposit in cash. To…

According to the North Carolina Real Estate Commission (NCREC) Rules, a broker who receives trust money, including a cash earnest money deposit, must deposit it into a trust or escrow account within three banking days of receipt. The clock starts from the moment the broker receives the funds, not upon the acceptance of the offer. This rule is designed to safeguard consumer funds by ensuring they are promptly placed in a secure, designated account. The high-risk nature of cash makes this immediate deposit requirement critical, and it cannot be altered by any agreement between the parties to the transaction.

A. A broker is not prohibited from accepting cash. The NCREC rules dictate how cash must be handled, not that it must be refused.

B. Holding cash until an offer is accepted violates the rule that requires a deposit within three banking days of receipt, not acceptance.

D. The broker who receives the funds is responsible for depositing them into a trust account, not for physically transferring the cash to another broker.

1. North Carolina Real Estate Commission. North Carolina Real Estate Manual. "Chapter 8: Trust Account Guidelines," Section: "Depositing Trust Money." The manual, which serves as the official text for licensing courses, specifies that NCREC Rule A .0116(b)(3) mandates the deposit of all trust money within three banking days of receipt. It clarifies that this rule applies to cash immediately upon receipt, irrespective of contract status.

2. North Carolina Administrative Code. Title 21, Chapter 58, Rule A .0116(b)(3). "A broker shall deposit all trust money received by him or her in a trust or escrow account maintained by the broker or firm with whom he or she is affiliated within three banking days of receipt of the money." This is the specific administrative rule governing the action.

3. UNC School of Government. Real Estate Law in North Carolina. "Chapter 11: Real Estate Brokerage," Section: "Handling of Trust Money." This academic text explains that the NCREC's three-day deposit rule is a strict requirement for licensees to protect client funds and that failure to comply is a serious violation. It emphasizes that the timeline begins upon receipt of funds.