California Financial Code

§ 50202

FIN § 50202 Effective Aug 29, 2025Div. 20 · Ch. 4

Statute text

(a)Escrow funds for a purpose authorized by the residential mortgage loan contract (1) shall be subject to and satisfy all applicable state and federal requirements, including Section 2609 of the federal Real Estate Settlement Procedures Act of 1974, as amended (12 U.S.C. Sec. 2601 et seq.) and all applicable provisions of the Civil Code, (2) shall be maintained in a depository institution as described in subdivision (b), and (3) may not be commingled with a licensee’s funds.

(b)Except as provided in subdivision (f), or as authorized by Section 2954.85 of the Civil Code, a trust account shall be placed in a non-interest-bearing account in a federally insured depository institution, a federal home loan bank, a federal reserve bank, or other similar government-sponsored enterprise, to be removed and used only for the following:

(1)Payments authorized by the borrower, allowed by the mortgage loan contract, or required by federal or state law.

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Legislative history

Amended by Stats. 2025, Ch. 103, Sec. 2. (AB 493) Effective August 29, 2025.