Trust Funds
If a buyer's offer is rejected and they had deposited earnest money, the broker must:
AKeep the deposit as a transaction fee
BReturn the deposit to the buyer promptly✓ Correct
CHold the deposit for 30 days
DTransfer it to the seller
Explanation
If an offer is rejected and no contract is formed, there is no basis for keeping the earnest money. The broker must promptly return the deposit to the buyer.
Related California Trust Funds Questions
- A broker receives a $10,000 earnest money deposit in cash from a buyer. The broker must:
- 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 receives a $5,000 earnest money deposit on a Friday at 5 PM. The three-business-day deposit deadline would be:
- The DRE has the authority to audit a broker's trust account records:
- Which of the following is NOT a permissible disbursement from a broker's trust account?
- Can a broker keep their own money in a client trust account?
- A broker's trust account shortage (the bank balance is less than the sum of all beneficiary ledger balances) most likely indicates:
- A broker's trust fund account must be reconciled:
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