In Alabama, a real estate broker's trust (escrow) account must be:
Why Maintained in a federally insured financial institution in Alabama Is Correct
Answer B: Maintained in a federally insured financial institution in Alabama
Exam Tip: Trust Funds
Trust fund questions test the rules for handling client money. Know the deadlines for depositing trust funds, what constitutes commingling vs. conversion, and the penalties for violations.
Key Trust Funds Terms in This Question
People Also Study
Related Alabama Questions
- Alabama law requires that a company's real estate trust account be maintained:Alabama License Law
- Alabama regulations require a broker to maintain their trust account in a financial institution located in:Trust Funds
- In Alabama, a broker's trust account records must be maintained for a minimum of:Alabama License Law
- In Alabama, who is ultimately responsible for ensuring that client funds are properly maintained in the trust account?Trust Funds
- An Alabama property located in a Special Flood Hazard Area (SFHA) requires:Environmental
- In Alabama, a qualifying broker's trust account must be reconciled:Trust Funds
- Which of the following is NOT an acceptable reason for a broker to withdraw funds from an Alabama trust account?Trust Funds
- An impound (escrow) account maintained by a mortgage lender holds funds for:Finance
Key Terms to Know
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Promissory NoteA written promise to repay a loan under specified terms — the borrower's personal financial obligation in a real estate transaction.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
ProrationThe division of ongoing property expenses (taxes, HOA dues, rents) between buyer and seller at closing based on their respective days of ownership.
State-Specific Concepts
Study This Topic
Practice More Alabama Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Alabama Quiz →