Under RELA, where must a Pennsylvania broker deposit earnest money and other client funds upon receipt?
Correct Answer
B) Into an escrow or trust account maintained at a federally insured financial institution
Under RELA (63 P.S. §455.604), brokers are required to deposit all client funds, including earnest money, into a separate escrow or trust account held at a federally insured financial institution. This requirement prevents commingling of client funds with the broker's own funds and protects clients in the event of broker insolvency.
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More Pa Rela Brokerage Rules Questions
Under RELA, what is the primary purpose of requiring Pennsylvania brokers to maintain escrow accounts?
Under RELA, a Pennsylvania broker of record has several statutory responsibilities regarding brokerage operations. All of the following are broker of record responsibilities EXCEPT:
Under RELA, a Pennsylvania salesperson, Rita, is offered a $2,000 gift card by a home inspector for referring clients to the inspector's business. May Rita accept this gift under RELA?
Under RELA, a Pennsylvania broker of record has a duty to ensure that all affiliated licensees maintain current and active licenses. If the broker discovers that a salesperson's license has expired, what must the broker do?
A Pennsylvania broker is opening a new bank account to hold client funds. Under RELA, which of the following account titles would satisfy the statutory requirement for proper escrow account identification?
- → During a routine reconciliation, a Pennsylvania broker discovers that the escrow account balance is less than the total of all client deposits currently being held. Under RELA, which of the following best describes the broker's obligation?
- → Under RELA, a Pennsylvania salesperson, Beth, is terminated by her brokerage after a dispute over commission splits. Beth has an active listing with a seller client. What happens to Beth's listing after termination?
- → Under RELA, a Pennsylvania salesperson, Eric, receives a $3,000 earnest money check from a buyer during a weekend showing. Eric's broker is on vacation and unreachable. What should Eric do with the check?
- → Under RELA, a Pennsylvania brokerage receives a written complaint from a consumer about one of its salespersons. The broker of record must take what immediate action?
- → Under RELA, a Pennsylvania brokerage employs both salespersons and associate brokers. What is the key difference between a salesperson and an associate broker under RELA?
- → Under RELA, where must a Pennsylvania brokerage display its current real estate license?
- → Under RELA, when a Pennsylvania salesperson places their license with a new brokerage, the salesperson is said to be operating under the authority of which individual?
- → Under RELA, when a Pennsylvania salesperson terminates their affiliation with a brokerage, what happens to the salesperson's license?
- → Under RELA, a Pennsylvania broker of record, Sarah, is retiring and wants to close her brokerage. What steps must Sarah take regarding her affiliated salespersons?
- → Under RELA, a Pennsylvania salesperson, Monica, wants to transfer from Brokerage A to Brokerage B. What is required for the transfer to be valid under RELA?
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