# Commingling

A term used when buying property management.

Mixing the firm's own money with the rents and deposits it holds for other people.

The trust account is the artifact and this is the failure it exists to prevent, in both directions: company money sitting in trust, and trust money paying company bills. California treats it as grounds for discipline of the license itself, which is what makes it the diligence item that reprices deals. Collecting rent is licensed activity there, so the rule reaches managers and not only sales brokers, and a verified written complaint obliges the commissioner to investigate, with suspension or revocation open on a finding. The exceptions are narrow and are where well-meaning but sloppy operators fail: a small float of the firm's own money for bank charges, and earned [management fees](https://searchspheresource.com/glossary/management-fee) that have to leave the account inside twenty-five days. Two costs land on a buyer. A trust shortage found after closing is the buyer's to fund, and it equals whatever the seller borrowed from deposits to make payroll. And the license does not convey, so name the [broker of record](https://searchspheresource.com/glossary/broker-of-record) for day one before agreeing a price.

Part of: Buying a Property Management Company (https://searchspheresource.com/guides/buying-a-property-management-company)

Source: https://searchspheresource.com/guides/buying-a-property-management-company/terms/commingling
Not dated: The same editorial definitions as the glossary, inside a trade.

Site index for machines: https://searchspheresource.com/llms.txt