Key Takeaways
- Delaware brokers must maintain trust accounts in federally insured institutions
- Deposits must be delivered to the broker promptly and placed in trust accounts
- Commingling of trust funds with personal or business funds is prohibited
- Trust accounts must be reconciled regularly with proper record keeping
- Records must be retained for 3 years and be available for Commission inspection
Last updated: January 2026
Delaware Trust Account Requirements
Proper handling of client funds is one of the most important responsibilities of a Delaware broker.
Trust Account Basics
Account Requirements
Delaware brokers must:
| Requirement | Specification |
|---|---|
| Account Type | Trust or escrow account |
| Institution | Federally insured bank or savings institution |
| Account Name | Must identify as trust/escrow |
| Location | Delaware institution (typically) |
| Signatory | Broker or authorized party |
Types of Funds in Trust
| Fund Type | Description |
|---|---|
| Earnest money | Deposits on purchase contracts |
| Security deposits | Rental property deposits |
| Rent collections | Property management receipts |
| Other client funds | Any funds held for others |
Deposit Requirements
Timing
Deposits must be handled promptly:
| Step | Timeframe |
|---|---|
| Salesperson to broker | Promptly (next business day) |
| Broker to trust account | As specified in agreement |
Holding Options
Delaware allows deposits to be held by:
- Broker's trust account
- Title company
- Attorney's escrow account
- Other as specified in agreement
Best Practice: Clearly specify in the contract where deposits will be held.
Prohibited Practices
Commingling
Commingling is mixing trust funds with personal or business funds:
| Prohibited | Permitted |
|---|---|
| Deposit personal funds in trust | Minimal amount for bank fees |
| Use trust funds for business | Separate operating account |
| Transfer without authorization | Authorized disbursements |
Conversion
Conversion is using trust funds for personal purposes:
- Criminal offense
- Grounds for license revocation
- May result in prosecution
Premature Disbursement
Cannot disburse trust funds until:
- Transaction closes, OR
- Written agreement of all parties, OR
- Court order
Trust Account Maintenance
Reconciliation
| Requirement | Frequency |
|---|---|
| Bank statement reconciliation | Monthly minimum |
| Trial balance | Regularly |
| Resolution of discrepancies | Immediately |
Record Keeping
Required records include:
- Bank statements
- Deposit records
- Check register/ledger
- Transaction documentation
- Reconciliation reports
Retention Period: 3 years minimum
Commission Access
The Commission may:
- Audit trust accounts
- Inspect records
- Request documentation
- Take action for violations
Interest on Trust Accounts
Interest-Bearing Accounts
If trust funds are placed in interest-bearing accounts:
- Must have written agreement from all parties
- Agreement specifies who receives interest
- Proper accounting required
- Typically for large or long-held deposits
When Interest May Apply
| Situation | Interest Consideration |
|---|---|
| Short-term deposits | Usually non-interest bearing |
| Large deposits | May be interest-bearing with agreement |
| Long-term holds | Consider interest-bearing |
| Security deposits | May have specific requirements |
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Test Your Knowledge
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Test Your Knowledge
What is commingling in Delaware real estate?
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