A buyer's earnest money deposit is held in the broker's trust account. The sale falls through with no dispute. The broker may release the deposit:
Why Only upon written instructions signed by all parties or a court order Is Correct
Answer B: Only upon written instructions signed by all parties or a court order
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 California Questions
- A broker must deposit a buyer's earnest money deposit into a trust account within:Trust Funds
- When a real estate broker receives a deposit check from a buyer, California law requires the broker to place the funds in a trust account or deliver them to the escrow within:DRE & Licensing
- A buyer and seller have a dispute over who is entitled to an earnest money deposit after a transaction falls through. The broker should:Trust Funds
- A buyer's earnest money is being held by the listing broker. The transaction falls through and there is a dispute about who is entitled to the funds. What should the broker do?Trust Funds
- A broker receives a check as earnest money. Under California law, the broker must deposit it into the trust account within:Trust Funds
- An earnest money deposit in a purchase contract is typically held by:Contracts
- Under California law, a real estate broker who manages property for clients must maintain a separate trust account for client funds. Mixing client funds with the broker's personal funds is called:Agency
- Real estate trust funds must be deposited into the trust account within how many business days of receipt?DRE & Licensing
Key Terms to Know
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
EscrowA neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Deed of TrustA security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
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.
Math Concepts
State-Specific Concepts
Study This Topic
Practice More California Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free California Quiz →