A Pennsylvania broker has not reconciled her escrow account for four months. No client complaints have been filed and no funds appear to be missing. Under RELA and SREC regulations, which of the following is correct?
Correct Answer
A) A violation has occurred because reconciliations must be performed monthly regardless of whether funds are missing
Under 49 Pa. Code §35.327, Pennsylvania brokers are required to perform monthly reconciliations of escrow accounts, comparing the bank statement balance to the total of individual client ledger balances. This is a procedural requirement designed to detect discrepancies early. Failure to reconcile monthly is itself a violation — the absence of missing funds or complaints does not cure the procedural breach.
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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?
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- → 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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A Pennsylvania broker receives a promissory note from a buyer as an earnest money deposit. Under RELA, how should the broker handle this instrument?
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Under RELA, a Pennsylvania broker, Victor, manages 50 rental units and holds approximately $75,000 in security deposits in his escrow account. Under the Pennsylvania Landlord and Tenant Act, after how many years of a tenancy must a landlord (or the managing broker) place the security deposit in an interest-bearing escrow account?