Where Does My Real Estate Deposit Go in Toronto?

Your real estate deposit is held in the seller’s brokerage trust account until closing, where it’s applied to your down payment and protected by RECO insurance.

Deposits are carefully regulated in Ontario to protect buyers and sellers. Here’s what happens:

Who Holds the Real Estate Deposit?

• The deposit holder is identified on the first page of the Agreement of Purchase and Sale.
• Typically, deposits are made payable to the listing brokerage and placed in their statutory Real Estate Trust Account.
• Always double-check the “payable to” section on your cheque—accuracy matters.

How Is the Deposit Managed?

• Held in trust: Funds remain in the trust account until closing.
• Applied at closing: Your deposit is credited toward your down payment.
• Interest: Only payable if the Agreement of Purchase and Sale specifies it.

Is My Deposit Protected?

Yes. Deposits held in a brokerage trust account are insured through the RECO Deposit Insurance Program, covering up to $100,000 per claim. This protection applies in rare cases of fraud, insolvency, or misappropriation of funds, giving buyers peace of mind.

The Fox Marin Real Team prepares its clients for the deposit process upfront ensuring funds are handled correctly, safeguarded, and ready to strengthen your offer.

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