Which of the following is TRUE about salesperson trust fund accounts?
Why Salespersons are not permitted to maintain a trust fund account Is Correct
Answer B: Salespersons are not permitted to maintain a trust fund account
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.
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Related California Questions
- 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
- Under California law, the maximum amount a broker may keep of their own funds in a trust account (to cover bank service charges) is:DRE & Licensing
- Under California law, a real estate broker must deposit trust funds received into a neutral escrow or into the broker's trust fund account no later than:Trust Funds
- If a real estate salesperson's employing broker dies or has their license suspended, the salesperson may continue to perform licensed activities for how long?DRE & Licensing
- California regulations require that a broker maintain a 'trust fund bank account record' (journal). What does this record show?Trust Funds
- What records must a California broker maintain for their trust account?Trust Funds
- For how long must a California broker maintain trust fund records?Trust Funds
- A licensed salesperson who changes brokers must:DRE & Licensing
Key Terms to Know
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
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.
Transfer TaxA tax imposed by state or local governments when real property ownership is transferred, typically based on the sale price.
State-Specific Concepts
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