Agency
What is the 'duty of accounting' owed by an Illinois real estate agent?
AThe duty to maintain a CPA license for handling client money
BThe duty to promptly account for all money and property received on behalf of a client✓ Correct
CThe duty to provide annual tax reports to clients
DThe duty to keep records for 10 years for all transactions
Explanation
The duty of accounting requires an agent to promptly account for all client funds and property received in connection with the agency relationship. This includes properly depositing earnest money, providing statements of funds received and disbursed, and returning client property upon request.
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Key Terms to Know
Agency
A legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
Net Operating Income (NOI)The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Math Concepts
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