Pennsylvania License Law
A Pennsylvania broker's escrow account must be reconciled:
AOnce per year for tax purposes
BMonthly, comparing the escrow account bank balance to the broker's trust account ledger✓ Correct
COnly when PREC requests an audit
DQuarterly with a CPA's verification
Explanation
PREC regulations require Pennsylvania brokers to reconcile their escrow accounts monthly — comparing the bank statement balance to the individual ledger entries for each transaction. Monthly reconciliation detects errors and potential misappropriation before problems compound.
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Key Terms to Know
Escrow
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
State-Specific Concepts
Trust Account Rules
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