Financial must-knows for R.E. attorneys in 2026 - by Joseph Ruhl

Elevated interest rates, shifting deal structures, and demands for operational efficiency have forced attorneys to navigate financing environments drastically different from even a few years ago. Now that we’re in the early weeks of 2026, real estate attorneys must expand their knowledge, not only of legal frameworks but also in banking tools, trust-account compliance, cybersecurity, fraud prevention, and risk-mitigation strategies that are impacting deals. 

The smallest financial misstep, even inadvertent, can quickly become a major issue that impacts operations and deal success. Here are some key areas in which real estate attorneys can prepare to best serve their clients this year.

Choose the Right Partner 
One of the most overlooked advantages for a real estate attorney is also the simplest: choosing a banking partner who understands what it takes to run a law office. Working with partners who are licensed attorneys, have experience handling IOLA and trust accounts, and are familiar with navigating complex regulatory environments gives you peace of mind that you cannot find with all financial partners.

For a real estate attorney, the right banking partner delivers more than financial services — it creates meaningful marketing and networking value. A relationship-driven bank makes strategic introductions to developers, investors, brokers, and property owners, provides opportunities for co-hosted events and thought leadership, and connects attorneys to industry and community leaders. These relationships enhance visibility, strengthen credibility, and help generate high-quality referrals that support long-term practice growth.

Trust/IOLA Rules Are More Complex Than Ever
Real estate transactions remain a major source of attorney escrow activity. But with higher-value deposits and more sophisticated fraud schemes, regulators are closely watching compliance with NY Rule 1.15 and associated IOLA and trust account requirements.

Orange Bank & Trust Company’s specialized Trust/IOLA product — designed by our team of licensed attorneys — uses a dual-account structure that automatically allocates interest correctly, eliminating one of the most inadvertent violations causing overdrafts at large institutions.

At big banks, misallocated interest and accidental overdrafts trigger immediate reporting to the Lawyers Fund for Client Protection and then the Grievance Committee. Our model is different: We work directly with attorneys to identify, correct, and prevent issues rather than escalate them unnecessarily. If your bank does not understand the significance of escrow account compliance and how any missteps can impact your license, it is time for a conversation.

The Increased Risk of Fraud and Cybersecurity Threats 
Real estate transactions remain a prime target for wire fraud, email-based impersonation, check fraud, spoofed payoff instructions, and more. These attacks are becoming more sophisticated, and law offices may have trouble keeping up. Real-time access to decision-makers at your banking institution is critical during a crisis.

Evaluate whether your banking partner can provide immediate, after-hours escalation support. If the answer is no, you may be exposed to unacceptable operational risk.

With Creative Financing Options Come Scrutiny 
With buyers and sellers looking for alternatives to traditional financing, attorneys are navigating mixed-use transactional financing, seller-funded or privately structured bridge loans, multi-partner deals with staggered contributions, increased reliance on 1031 exchanges and DSTs, and shared equity buyer programs. 

These transactions will continue to accelerate in 2026, and with creativity will come scrutiny from lenders, regulators, and counterparties. Expect enhanced verification requirements, more rigorous source-of-funds reviews, and closing timelines that rely on completing those checks without disruption. 

To prepare, start developing relationships with banking teams who understand real estate deal flow and can anticipate needs before they happen. When your financial partner can flag compliance issues before they reach the closing table, you reduce friction and protect client timelines. 

Alleviate Cash-Management Frustrations 
Attorneys need systems that adapt to their workflow, not the other way around. However, many banks still rely on outsourced installation, one-size-fits-all remote deposit systems, slow turnaround on custom reporting, and limited visibility into trust-account activity. 

We believe in a hands-on approach: in-person installations, real-time training, customized reporting to meet client needs, and flexible system structuring to match how attorneys work. 

If your bank’s current electronic tools and systems are creating inefficiencies, ask whether a tailored solution is available. If not, explore partners with greater flexibility.

Don’t Ignore a Deposit-Insurance Strategy
With property values high and deal sizes large, attorneys increasingly hold funds well above standard FDIC limits. In 2026, clients will expect a clear plan for safeguarding these balances.

Products like ICS (Insured Cash Sweep) offer attorneys a way of protecting client funds above $250,000. This is an area of active investment and expansion within our Legal Services Division, and one that will become essential across the profession.

Set Yourself Up for a Successful 2026
This year will bring innovation, complexity, and opportunity across real estate financing. Attorneys who deepen their understanding of the financial tools behind transactions, and who partner with banking experts who know their world, will be best positioned to safeguard client interests and streamline closings.

The rules governing trust accounts are tightening, and fraud threats are rising. Precision, responsiveness, and a banking relationship built on expertise will be what sets you apart.

Joseph Ruhl, Esq., is the executive vice president, regional president of Westchester County, Orange Bank & Trust Company, Middletown, N.Y.