At the request of the owner of the funds, a California broker places trust funds into an interest-bearing account. Under Business and Professions Code §10145, who may receive the interest?
Correct Answer
B) Whomever the parties designate in writing, but never the broker or the broker's licensees
Section 10145(d) lets a broker place trust funds in an interest-bearing account when the owner of the funds requests it and the statutory conditions are met: the account stands in the broker's name as trustee, the funds are insured, they are kept separate from other accounts, and the terms are disclosed. Interest earned on those funds shall not inure directly or indirectly to the benefit of the broker or of a person licensed to the broker. Where the funds are held under an executory sale, exchange or lease contract, the parties must specify in the contract or a collateral written agreement who is to be paid or credited the interest. Section 10145(e) adds that the broker has no obligation to use an interest-bearing account unless asked.
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Related Topics & Key Terms
Key Terms:
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More Practice Of Real Estate Disclosures Questions
Under California law, a real estate agent owes a duty of honest and fair dealing to all parties in a transaction, not only to the agent's own client. Which provision most directly establishes this duty?
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A California-licensed salesperson uses the title 'Real Estate Consultant' on business cards and marketing materials without holding any special certification or designation. Under DRE regulations, this practice is:
Barnard made an offer to buy a vacant residence. The offer was accepted by the seller. Prior to the close of escrow, Barnard requested permission from the broker to enter and make minor repairs to the house. Which of the following is true?
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- → A developer proposes a new eight-unit condominium building in San Francisco on a parcel that an NHD report shows lies within a delineated Alquist-Priolo Earthquake Fault Zone. Under the Alquist-Priolo Act, what must happen before the city may approve the project?
- → At a DRE administrative disciplinary hearing in California, what standard of proof must the Department meet to sustain a finding against a licensee?
- → The Transfer Disclosure Statement requires sellers to disclose various known property conditions under California Civil Code §1102 et seq. All of the following must be disclosed on the TDS EXCEPT:
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- → A California salesperson receives a $3,000 earnest money deposit from a buyer on Tuesday morning. The salesperson does not deliver the funds to the broker until the following Monday. Under California trust fund rules, has a violation occurred?
- → A California property owner in a Mello-Roos CFD discovers that the bond proceeds were mismanaged by the CFD administrator and the planned community park was never built, even though property owners have been paying the special tax for 10 years. What legal recourse does the property owner have?
- → The Real Estate Commissioner may discipline a licensee for the conduct described in Business and Professions Code §§10176 and 10177. Which of the following would NOT be grounds for disciplinary action?
- → Which of the following correctly describes California's mandatory fair housing continuing education requirement for real estate license renewal?
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