Disbursement of Closing or Settlement Proceeds of a Real Estate Transaction from Collected Funds

State of New Jersey DEPARTMENT OF BANKING AND INSURANCE LEGISLATIVE AND REGULATORY AFFAIRS PO BOX 325 TRENTON, NJ 08625-0325 Tel (609) 984-3602 Fax (609) 292-0896 Visit us on the Web at www.njdobi.org New Jersey is an Equal Opportunity Employer • Printed on Recycled Paper and Recyclable JAMES E. MCGREEVEY Governor HOLLY C. BAKKE Commissioner BULLETIN NO. 04-09 TO: ALL TITLE INSURERS IN NEW JERSEY FROM: HOLLY C. BAKKE, COMMISSIONER DEPARTMENT OF BANKING AND INSURANCE RE: DISBURSEMENT OF CLOSING OR SETTLEMENT PROCEEDS OF A REAL ESTATE TRANSACTION FROM COLLECTED FUNDS The Department of Banking and Insurance (“Department”) is notifying all title insurers of an amendment to N.J.S.A. 17:46B-10.1. The amendment was signed into law on January 9, 2004 and took effect on that date. The effect of the amendment is to clarify an issue that concerns title insurance companies and title insurance producers, specifically the requirement under N.J.S.A. 17:46B-10.1.b. that disbursements of closing or settlement proceeds be made from collected funds. That statutory provision requires that closing or settlement proceeds of real estate transactions be disbursed by title insurance companies or title insurance producers from funds deposited by cash, electronic wire transfer, or certified, cashier’s, teller’s or bank check or other collected funds. Prior to the amendment, it was not clear what the term “collected funds” meant. As amended the statute now explicitly provides that a New Jersey licensed attorney’s trust account check and a trust or escrow account check from a New Jersey licensed insurance producer shall be considered “collected funds.” All title insurance companies should be familiar with the provisions of N.J.S.A. 17:46C-10.1 as amended and conduct their business activities in accordance with its provisions. Title insurance companies are encouraged to share the information contained in this bulletin with their agents. _____5/26/04 ______/s/ Holly C. Bakke Date Holly C. Bakke, Commissioner INOORD\fos04-03.doc