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?
Correct Answer
B) Immediately identify the cause, restore the shortage, and report to the State Real Estate Commission if misappropriation is involved
Under RELA (63 P.S. §455.604), a broker is required to maintain escrow funds intact and separate from personal or operating funds at all times. A shortage in the escrow account signals a potential commingling or misappropriation of client funds — both serious violations. The broker must immediately identify the source of the discrepancy, restore the account to the correct balance, and report to the State Real Estate Commission (SREC) if the facts suggest misappropriation has occurred.
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More Pa Rela Brokerage Rules Questions
Under RELA, a Pennsylvania brokerage must ensure that all licensees affiliated with the brokerage have completed what requirement before practicing real estate?
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?
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?
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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, 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, a Pennsylvania salesperson, Jake, earns a commission from a closed transaction. How should the commission be paid?
- → Under RELA, a Pennsylvania broker of record must maintain written office policies. Which of the following topics should these policies address?
- → 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, when a Pennsylvania salesperson terminates their affiliation with a brokerage, what happens to the salesperson's license?
- → Under RELA, a Pennsylvania broker of record, Steve, wants to change the brokerage's physical office location. What must Steve do under RELA?
- → Under RELA, a Pennsylvania salesperson must operate under the supervision of which type of licensee?
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- → Under RELA, how long must a Pennsylvania brokerage retain transaction records?
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Previous Question
A Pennsylvania broker receives a $5,000 earnest money deposit from a buyer on Friday afternoon. Under RELA, what is the latest the broker may deposit these funds into the escrow account?
Next Question
Under RELA, a Pennsylvania broker is required to maintain specific records related to the escrow account. Which of the following would NOT be required as part of proper escrow record-keeping?