agency

escrow account

An escrow account, often called a trust account, is a separate bank account a broker maintains to hold money belonging to others, such as earnest money deposits, security deposits, and rents. The broker acts as a fiduciary for these funds and must keep them apart from personal or business funds. Most states set rules on deposit deadlines, record keeping, interest, and how much broker money may be kept in the account to cover fees.

Exam tip
Mixing client funds with the broker's own money is commingling; using them for personal purposes is conversion. Deposit timeframes vary by state.
Example
A buyer's $10,000 earnest money check is deposited into the listing broker's escrow account, where it stays until closing or the contract terminates.

Related terms & state variants

Sources

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Last verified: 2026-10-23