Real Estate Practice in Iowa
Day-to-day Iowa practice is shaped by trust-account rules and disclosures required when property changes hands. This chapter covers earnest money handling and Iowa's state-specific transfer disclosures.
Trust Accounts and Earnest Money
Client funds such as earnest money must be handled through the broker's trust (escrow) account. A salesperson who receives funds must deliver them promptly to the broker, and the broker must keep trust money separate from personal and business funds. Commingling or converting trust money is among the most serious violations of Iowa license law.
Groundwater Hazard Statement and Transfer Disclosures
Iowa requires a Groundwater Hazard Statement to accompany many recorded transfers, disclosing wells, solid waste, hazardous conditions, underground storage tanks, and private sewage information. Iowa also has requirements tied to private sewage systems at time of transfer. Licensees should confirm these state-specific documents are completed so the transfer can be recorded without delay.
Residential Property Condition Disclosure
In addition to state environmental forms, sellers of residential property generally must give buyers a written disclosure of the property's known condition. Licensees must not help a seller conceal known defects and should encourage honest, complete disclosure. Accurate disclosure protects both the consumer and the licensee from later misrepresentation claims.