Trust Funds
Under AREC rules, how quickly must a broker deposit earnest money or other trust funds after receipt?
ABy the end of the same business day
BWithin 3 business days of receipt✓ Correct
CWithin 10 calendar days of receipt
DAt or before the closing date
Explanation
Alabama regulations require that earnest money and other trust funds be deposited into the broker's trust account within 3 business days of receipt (or as otherwise specified in the purchase contract).
People Also Study
Related Alabama Questions
- Alabama regulations require brokers to maintain trust account records for at least:Trust Funds
- When must an Alabama broker deposit earnest money received from a buyer into the trust account?Trust Funds
- An Alabama broker may deposit their own funds into a trust account in which scenario?Trust Funds
- In Alabama, a buyer's right to rescind a purchase contract within 3 days applies most commonly to:Contracts
- An Alabama purchase contract that is subject to the buyer obtaining a satisfactory home inspection within 14 days is an example of a:Contracts
- Alabama regulations require a broker to maintain their trust account in a financial institution located in:Trust Funds
- In a purchase transaction in Alabama, the earnest money deposited by the buyer is typically applied at closing toward:Finance
- Under Alabama landlord-tenant law, a landlord must return a security deposit within how many days after the tenant vacates?Property Management
Key Terms to Know
Earnest Money
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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.
Math Concepts
State-Specific Concepts
Trust Account RulesAREC Regulation
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 →