Active Rain January 6, 2009

Commission Escrow Act: NY Agents MUST Use Updated Listing Contracts.

If you’ve ever arrived at a closing and been informed that your commission was being disputed, withheld, or otherwise not being paid, you’ll appreciate New York State’s newly-minted Commission Escrow Act.  It requires the commission money to be deposited in escrow with the county clerk pending resolution. The great thing about this law is the certainty of getting paid when you win your case, as opposed to maybe someday collecting when the money is held by the seller’s attorney.

However, the act is not automatic. Listing agreements have been updated with verbiage to make sure brokers are protected, so contact your broker or MLS to get copies before you list another house.

Forewarned is forearmed! Finally Albany does something right! This law was way overdue.