The Trusted Adviser October 2009 | Volume 2 - Number 8

ATTORNEYS | Practice Notes

Legislative Updates

Indiana

Closings; Title Insurance Agents

PL 92-2009, HEA 1374, Effective Date: July 1, 2009 (for all provisions). Adds: chapter IC 27-7-3.7 to the Indiana Code.

This new section of the code regulates escrow transactions in real estate transactions. First, the law defines "closing agent," "escrow account," "escrow transaction," "good funds," and "real estate transaction." Next, the law requires that:

  1. Funds received in connection with an escrow transaction must be deposited in an escrow account unless the parties agree in writing to a different arrangement.

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  3. When funds are received from a single party that are at least $10,000 in aggregate, a closing agent may not make disbursements from the escrow account unless these funds are wired funds "unconditionally held by and irrevocably credited to the escrow account of the closing agent."

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  5. When funds are received from a single party that are less than $10,000 in aggregate, a closing agent may not make disbursements from the escrow account unless these funds are "good funds." "Good funds" include:
     
    1. (1) U.S. currency; (2) wired funds unconditionally held by the escrow account of the closing agent; (3) certified or cashier's checks drawn on an existing account at a bank, savings and loan, credit union, or savings bank; (4) a check drawn on a real estate broker's trust account if the closing agent reasonably believes there are sufficient funds in the account; (5) a personal check not exceeding $500; (6) a check issued by the state, the United States, or a political subdivision of either; or, (7) a check drawn on the escrow account of another closing agent if that account is reasonably believed to have sufficient funds.

  6. A holder of a mortgage lien may request, via written closing instructions or a written payoff statement, to receive its proceeds electronically from an escrow account if the escrow account receives funds "unconditionally held and irrevocably credited" to that account.

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  8. A closing agent may advance up to $500 from an escrow account to pay incidental fees. Incidental fees may be paid to: (1) effect and close the sale of; (2) purchase; (3) exchange; (4) transfer; (5) encumber; or (6) lease; real property that is the subject of the escrow transaction.

 

 

 

THE TRUSTED ADVISER is published by Attorneys’ Title Guaranty Fund, Inc., P.O. Box 9136, Champaign, IL 61826-9136. Inquiries may be made directly to Mary Beth McCarthy, Corporate Communications Manager. ATG®, ATG® plus logo, are marks of Attorneys’ Title Guaranty Fund, Inc. and are registered in the U.S. Patent and Trademark Office. The contents of the The Trusted Adviser © Attorneys' Title Guaranty Fund, Inc.

[Last update: 9-29-09]

 

 

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