WILLIAM DONALD SCHAEFER, Governor                   Ch. 529

the builder in order to assure that the advance payment in the
escrow account can be returned to the buyer if the buyer becomes
entitled to the return of the advance payment. However, a
builder may place advance payments received in connection with
more than one home into a single escrow account.

(3)  If the advance payment under paragraph (1) of
this subsection is made in the form of a check or draft, a custom
home builder may accept the advance payment only in the name of
the escrow account.

(4)  If consideration received under the contract in
advance of the completion of the labor or the receipt of
materials for which the consideration is paid does not total in
excess of 5 percent of the contract price, that consideration
need not be placed in an escrow account under paragraph (1) of
this subsection.

(b)  A custom home builder may make withdrawals from an
escrow account established in compliance with subsection (a)(1)
of this section solely for the purpose of:

(1)  Returning all or a portion of the sum of money to
the buyer;

(2)  Paying documented claims of persons who have
furnished labor or material, including fuel, in connection with
the custom home contract for which the funds were advanced;

(3)  Paying a sum of money to the custom home builder
if the buyer forfeits the sum under the terms of the contract of
sale; or

(4)  Final payment upon the issuance of an occupancy
permit or possession.

(c)  In lieu of the escrow account required under subsection
(a) of this section, a custom home builder may establish and
maintain a separate escrow account for each custom home contract
for which he receives consideration that he would be required to
place into escrow under subsection (a). Each individual escrow
account shall require the signature of both the buyer and the
custom home builder for any withdrawal. Deposits and withdrawals
to and from this account shall be governed by the requirements of
subsections (a) and (b) of this section.

(d)  (1) In lieu of the escrow accounts required under
subsection (a) or (c) of this section, a custom home builder may
obtain and maintain a corporate surety bond in the form and in
the amounts required of a vendor or builder under § 10-302 of
this title.

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