NAC645A.220. General and miscellaneous standards of practice; noncompliance with certain provisions.

     1. Each escrow agent and agency shall conduct the business of the escrow agency openly, fairly and honestly, and shall at all times conform to the accepted business ethics and practices of the escrow agency business.

     2. Each escrow agent and agency shall act without partiality to any of the parties to an escrow transaction.

     3. If an escrow agency performs services as a third party in the collection of payments in connection with a loan secured by real property:

     (a) Unless otherwise agreed between the parties, the escrow agency must remit the payment to the person who is entitled to receive the payment not later than 30 days after the last day of the month in which the escrow agency collected the payment; and

     (b) The escrow agency shall not make payments in a manner that causes a policy of insurance to be cancelled or causes property taxes or similar payments to become delinquent.

     4. If an escrow agency maintains a trust account, the trust account must at all times contain sufficient money to pay all money due or owing to all clients. An escrow agency shall not make a disbursement from the account unless authorized to make a disbursement by:

     (a) Escrow instructions;

     (b) A servicing agreement; or

     (c) An agreement between the parties to the transaction that the escrow agency may periodically withdraw money from the account to pay for services performed for the client.

     5. Each escrow agency that maintains a trust account shall keep a record of all money deposited in the account. These records are subject to inspection by the Commissioner or his or her authorized representative and must include, without limitation:

     (a) The name of the person who sent the money to the escrow agency;

     (b) The account in which the money was deposited;

     (c) The name of the person to whom the money belongs;

     (d) The date the money was received;

     (e) The date the money was deposited into the account;

     (f) The date of each withdrawal from the account;

     (g) The name of each person to whom money was disbursed; and

     (h) Any other pertinent information concerning the account, including, without limitation, escrow instructions and servicing agreements.

     6. If an escrow for the sale of real property is established, the holder of the escrow shall, on the date of establishment of the escrow, record in writing the number and the date of expiration of the license issued pursuant to chapter 624 of NRS of any contractor who will be paid from money held in the escrow. The holder of the escrow is not required to verify independently the validity of the number of the license.

     7. An escrow agency or agent shall post in the records of the escrow any receipt or disbursement of money as of the date of that receipt or disbursement, regardless of the date of the act of posting.

     8. Upon receipt of a request in writing from the Commissioner or from a person who deposited a document, money or property into escrow, an escrow agency shall account to the requestor for that document, money or property held in trust and shall provide a written receipt for any deposit into escrow if requested by the person making the deposit. An escrow agency may provide a receipt of deposit electronically.

     9. All written escrow instructions and all escrow instructions transmitted electronically via the Internet must be dated.

     10. An escrow agency shall not accept any change to escrow instructions, or to amended or supplemental escrow instructions, unless the change is signed or initialed by all persons who signed or initialed the escrow instructions before the change was presented.

     11. An escrow agency shall deliver a copy of the escrow instructions or a change to the escrow instructions to the person executing the instructions or change to the instructions at the time of execution.

     12. An escrow agency shall use documents, money or other property deposited in escrow only in accordance with the written escrow instructions of the principals to the escrow or, if not otherwise directed by written or electronically executed instructions, in accordance with sound escrow practice, or pursuant to an order of a court of competent jurisdiction.

     13. An escrow agency shall not record or deliver for recording any instrument which purports to transfer a person’s title to or interest in real property without first obtaining that person’s written consent to the recording or delivery.

     14. Upon close of escrow, an escrow agency shall deliver to each principal in the transaction a written statement of all receipts and disbursements applicable to him or her, identifying the person to whom any such disbursement was made.

     15. An escrow agency shall file with the Commissioner a copy of any document:

     (a) Affecting the escrow agency; and

     (b) Filed by the escrow agency with the Secretary of State,

Ê which has not been previously filed with the Commissioner.

     16. If the Commissioner determines that an escrow agency has not complied with the provisions of subsections 2 to 15, inclusive, the Commissioner may require the escrow agency to deliver an audited financial statement that is prepared, using the records of the escrow agency, by a certified public accountant who holds a certificate to engage in the practice of public accounting in this State. Except as otherwise provided in this subsection, the financial statement must be submitted to the Commissioner not later than 60 days after the Commissioner requests the financial statement from the escrow agency. The Commissioner may grant a reasonable extension for the submission of the financial statement if an extension is requested not later than 60 days after the Commissioner requests the financial statement from the escrow agency.

     (Added to NAC by Comm’r of Mortgage Lending by R086-04, eff. 8-25-2004; A by R143-08, 4-20-2010)—(Substituted in revision for NAC 645A.050)