Your Trust Account Software Should Be Compliant with Commission Rules

Software vendors may submit their trust account software products to the Real Estate Commission for review. Commission staff evaluates Trust Account Software for compliance with the North Carolina Real Estate Commission Rules, in particular, Commission Rule A .0117. In order to be deemed compliant, a vendor  must demonstrate that the software will generate the  reports required to be maintained by the Commission Rules. Those reports include:

Trust Account Journal

Supplemental Deposit Worksheet

Supplemental Disbursement Worksheet

Ledger

Bank Reconciliation

Ledger Trial Balance

The list of compliant Trust Account Software can be found on the Commission’s website at www.ncrec.gov/resources/TrustAccount.

If a Broker-in-Charge (BIC) chooses not to use Trust Account software on the compliant list, it would be prudent for that BIC to verify that the Trust Account software generates the reports listed above. The BIC may also want to confirm that the software provides other utilities that the company needs to run the real estate business. The Commission doesn’t evaluate the Trust Account software’s management utility beyond the requirements of the Commission’s rules. For example, if your company is looking for Trust Account software to manage 100 long term rentals, can the software:

Generate a report on the tenants delinquent on rent payments

Prepare documents for summary ejectments

Create and track work orders for repair request

Generate a report on properties available for rent, etc.

A big concern in choosing computer software is support.  Are you going to be able to get support you need when you need it?  You may want to call the Support phone number and/or send them an email before purchasing the software and see what kind of response you get. Remember, too, that in order to function properly, any software must be kept updated. Brokers should plan on and budget for required updates of software systems.

Another major consideration in choosing Trust Account software is the installation of the software.  Do you have existing records on a software program that you would like to transfer to the new software? Can you transfer tenant and owner information to the new software?  Will Support help you set up the initial Trust Account balances during the installation of the software?  If the Trust Account balances are not set up properly during the installation process, then you are going to have problems reconciling the bank balance to the Trust Account Journal in the software and balancing the Ledgers to the Trust Account journal.

Software vendors are now trending toward web-based Trust Account applications. Web-based software is more expensive, but depending on the vendor, the software can do more for the company such as:

Provide a website for marketing

Online leasing applications

Tenant screening

Rent collection online

Text messaging

Emailing

Owner and tenant portals

Disburse owner payments and expenses online

Store data on an off-site server

The Commission does not evaluate Trust Account software for any of these attributes. It is up to the user to decide whether or not to use web-based software. Be sure to discuss with the vendor the benefits and risks of using a web- based software.

This article came from the October 2015-Vol46-2 edition of the bulletin.