Trust Funds
Can a broker keep their own money in a client trust account?
AYes, up to $10,000
BYes, an amount sufficient to maintain the account and avoid fees✓ Correct
CNo — any broker funds make it illegal commingling
DOnly if clients consent in writing
Explanation
A broker may keep a small amount of their own funds in the trust account to cover bank fees (typically up to $200). Keeping more than necessary constitutes commingling.
Related California Trust Funds Questions
- Which of the following is NOT a permissible disbursement from a broker's trust account?
- 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?
- A salesperson collects an earnest money deposit from a buyer. What must the salesperson do with these funds?
- A broker receives an earnest money check made out to the seller. The buyer instructs the broker to hold the check uncashed until offer acceptance. The broker MUST:
- A 'shortage' in a broker's trust account — where the trust liability exceeds the bank balance — is most likely evidence of:
- Which of the following is considered 'commingling' of trust funds?
- A broker who violates trust fund regulations is subject to which of the following penalties?
- A broker's trust fund records must be retained for how long after the transaction closes or the funds are disbursed?
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