Trust Account

Learn how trust accounts work in Canadian real estate, who manages them, and how they protect buyers and sellers during transactions.

Trust Account



What is a Trust Account?

A trust account is a special type of bank account used by real estate professionals, lawyers, or developers to hold client funds separately from their own operating funds.

Why Do Trust Accounts Matter in Real Estate

In Canadian real estate, trust accounts are a critical component of financial and legal protection. When a buyer submits a deposit during a property transaction, that money is held in a trust account until closing.


Trust accounts are used for:
  • Buyer deposits or down payments
  • Rent collection by property managers
  • Construction draws or developer funds


Real estate brokerages and law firms are regulated and audited to ensure trust accounts are properly maintained. Misuse or commingling of funds can result in disciplinary action, fines, or loss of license.


Trust accounts provide transparency and security, ensuring that funds are available and accounted for during the transaction. Buyers and sellers should always confirm that deposits are being held in a verified trust account.


Understanding trust accounts builds confidence in the real estate process and protects clients from financial risk.

Example of a Trust Account

A buyer’s $50,000 deposit is held in the listing brokerage’s trust account and only released upon successful closing of the home sale.

Key Takeaways

  • Holds client funds securely during transactions.
  • Used for deposits, rents, and development funds.
  • Maintained by lawyers or brokerages.
  • Separates client money from business funds.
  • Ensures trust, compliance, and accountability.

Related Terms

  • Deposit
  • Real Estate Lawyer
  • Brokerage Account
  • Closing Process
  • Financial Regulation

Additional Terms

Land Banking

Gentrification is the process by which a traditionally lower-income neighbourhood undergoes revitalization and attracts higher-income residents,. more

Land Assembly

Land assembly is the process of acquiring and consolidating multiple adjacent parcels of land under one ownership, typically for redevelopment or. more

Joint Venture

A joint venture in real estate is a partnership between two or more parties to develop, own, or operate a property or project, sharing risks, costs,. more

Infill Development

Infill development is the process of building new housing, commercial buildings, or amenities on vacant or underutilized land within existing urban areas.. more

Inclusionary Zoning

Inclusionary zoning is a municipal planning tool that requires or incentivizes developers to include a percentage of affordable housing units in new. more

Impact Fees

Impact fees are charges levied by municipalities on new developments to offset the cost of additional public infrastructure and services required by. more

More For You

65% Of GTHA Landlords Offering Rental Incentives As Demand Slows And Supply Grows
Shutterstock

The percentage of Greater Toronto Hamilton Area (GTHA) landlords offering incentives continued to tick up in the second quarter, nearly doubling the amount offering incentives a year ago. From free months of rent to straight cash, Urbanation's Q2-2025 rental market report finds more and more landlords are getting creative about filling units.

65% of GTHA landlords were offering incentives last quarter, up from 36% in Q2-2024. This follows similar findings from Q1 where the percentage of buildings offering incentives had more than doubled, from 31% in Q1-2024 to 63%.

Keep ReadingShow less
​A rendering of Marine Gateway 2 near Marine Drive Station in Vancouver.

A rendering of Marine Gateway 2 near Marine Drive Station in Vancouver. / Perkins&Will, PCI Developments

A decade after they completed the Marine Gateway mixed-use hub, Vancouver-based PCI Developments is now ready to move forward with the sequel: Marine Gateway 2.

Located directly adjacent to, and integrated with, the Canada Line SkyTrain's Marine Drive Station, Marine Gateway is bounded by SW Marine Drive on the north, Yukon Street on the east, the Marine Drive Station bus loop on the south, and Cambie Street on the west. The mixed-use complex is home to a 36-storey residential tower, a 27-storey residential tower, and a 14-storey office tower all above 260,000 sq. ft of retail space and public space.

Keep ReadingShow less
Boathouse, Barrel Sauna, Rooftop Deck: This Muskoka Property Has It All

Modern Movement Creative Inc.

Sitting pretty just two minutes from the mainland, 6 Taylor Island 26LM is about as close as it gets to having it all.

This island property off Gravenhurst’s shore delivers a curated blend of classic Muskoka charm and contemporary cottage luxury — all without sacrificing a single creature comfort. It’s a rare listing that manages to tick nearly every box: sweeping shoreline, sunset views, a fully renovated main cottage, and a boathouse that doesn’t just meet expectations, but clears them by a mile.

Keep ReadingShow less
Birch Hill, Brookfield Acquire First National Financial In $2.9B Deal
First National Financial Corporation

Big news broke this past weekend from First National Financial Corporation — the parent company of First National Financial LP, an originator, underwriter, and servicer of residential and commercial mortgages. Off the top: the firm has announced that they have “agreed to be acquired by Birch Hill Equity Partners and Brookfield, with existing shareholders Stephen Smith and Moray Tawse maintaining minority ownership.”

A press release from First National from Sunday further specifies that the arrangement is “definitive” and that the acquisition will be controlled by a new entity known as Regal Bidco Inc. It adds that Regal will “acquire all of the outstanding common shares of the Company, other than the Rollover Shares, for $48.00 per Share in cash.”

Keep ReadingShow less
Stunning And Sprawling 66-Acre Estate Listed In Hockley Valley

Sotheby's International Realty Canada

Just an hour outside of Toronto, a 66-acre estate — nestled in the rolling hills of Hockley Valley — has just hit the market. And it's a property that has to be seen to be believed.

Located at 3030 Concession Rd 3 in Adjala-Tosorontio, the sprawling acreage is home to a grand 5-bed, 6-bath residence with approximately 11,000 sq. ft of living space.

Keep ReadingShow less
Toronto Council Approves 8 Proposals From Altree, Hullmark, Devron & More
2-12 Cawthra/ZAS Architects + Interiors Inc, BV Realty Partners

Toronto City Council held its July session last week, where councillors gave the go-ahead on around 20 housing development proposals and refused just three. Among the more notable projects was a 63-storey tower headed for Church-Wellesley Village and a 50-storey tower to replace a parking lot and vacant lands in the Fashion District.

All together, the approved projects are expected to add almost 9,400 new housing units to the city, and will hopefully play a part in Toronto reaching its target of 285,000 new homes by 2030. According to the Province, the city fell short of its 2024 goal of 23,750 housing starts, recording just 20,999 new units. Still, Toronto was awarded $67.2 million through the provincial Building Faster Fund in early June for reaching 88% of its target for the year.

Keep ReadingShow less
​The 35-storey tower proposed for 807-815 Hornby Street in Vancouver.

The 35-storey tower proposed for 807-815 Hornby Street in Vancouver. / SHoP Architects, BOP Architects, Reliance Properties

Developers in Vancouver are continuing to show a strong interest in hotels, with the latest proposal for a new hotel set for a site along the popular shopping corridor of Robson Street in downtown Vancouver.

The subject site of the proposal is 807-815 Hornby Street, a corner site at the intersection with Robson Street right next to Robson Square and the Vancouver Art Gallery.

Keep ReadingShow less
Insider: It's Time To Get Back To Basics (And Sell Homes, Not Just Paper)

Forêt Sales Gallery by Canderel

It wasn’t that long ago that pre-construction sold itself. The market was hot, units moved in minutes, and buyers would sign almost anything — just to get in.

Now, the market has shifted. It’s more uncertain, more cautious, and frankly, more real. In my recurring LinkedIn series Real Talk w/ Tim Ng, I sat down with some of the top new development sales and marketing leaders from Toronto, Miami, and Vancouver for a roundtable discussion on what it really means to ‘get back to basics’ – what’s changed in their approach, and what’s stayed true.

Keep ReadingShow less