Broker Maria's sales associate, James, collects a $10,000 earnest money check directly from a buyer at an open house on Saturday. Under Maryland law, which of the following correctly describes the handling of this check?
Correct Answer
B) James must deliver the check to his supervising broker Maria within one business day so she can deposit it into the trust account
Under Maryland license law, only a licensed broker (not a salesperson or associate broker acting independently) is authorized to maintain a trust account. When a sales associate receives client funds, they must promptly deliver those funds to their supervising broker, who must then deposit them into the trust account within one business day of receipt. James must deliver the check to Maria within one business day of receiving it.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Broker supervision is the legal obligation of a designated or managing broker to oversee and be accountable for the real estate activities of all salespersons and associate brokers operating under their license.
Commingling is the illegal act of mixing client funds with a broker's personal or business operating funds, while conversion is the unauthorized use of client funds for the broker's own benefit. Both are serious violations that can result in license revocation.
Commingling is the illegal act of mixing client trust funds with a broker's personal or business operating funds; conversion is the misappropriation of those funds.
More Practice Of Real Estate Questions
In Wyoming real estate practice, an associate broker or salesperson is not associated with a responsible broker at renewal. What should the licensee remember?
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A Wyoming licensee is reviewing an out-of-state salesperson applicant prepares for testing. What is the best answer?
In Wyoming real estate practice, a salesperson applicant age is reviewed. What should the licensee remember?
A responsible broker in Wyoming asks about a nonresident applicant provides home-state evidence. Which answer follows Wyoming law?
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