Trust Funds
Can a property management broker combine the security deposits for multiple tenants in a single trust account?
ANo; each tenant must have a separate account
BYes, provided the broker maintains separate ledger records for each tenant's deposit✓ Correct
CYes, but only if all tenants have signed written authorization
DNo; security deposits must be held in an escrow account
Explanation
A broker may hold security deposits for multiple tenants in one trust account (a pooled account) as long as they maintain individual ledger records for each tenant showing the amount held on their behalf. Separate accounts for each tenant are not required but are permissible.
Related California Trust Funds Questions
- Which of the following is TRUE about salesperson trust fund accounts?
- A broker receives a $10,000 earnest money deposit in cash from a buyer. The broker must:
- A broker must deposit a buyer's earnest money deposit into a trust account within:
- A broker may keep a maximum of how much of the broker's own funds in the trust account without it being considered commingling?
- A broker who holds a disputed earnest money deposit and cannot get agreement from the parties may:
- A salesperson who works for Broker A receives an earnest money deposit. Without telling Broker A, the salesperson deposits it into the salesperson's own personal account. This is:
- A broker is required to maintain a columnar record (trust fund ledger) for the trust account. The purpose of this record is to:
- The illegal use of client trust funds for the broker's personal benefit is called:
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