Chapter 14 Quiz Flashcards
Which of the following would not necessarily belong in a firm’s mandatory interest-bearing trust account?
A. Earnest money deposits.
B. Advance fees.
C. Security deposits.
D. A down payment for a land contract.
C. Security deposits received by a licensee may not be client funds. A firm’s mandatory interest-bearing trust account is for client funds and other real estate funds, such as security deposits, should be deposited in an interest-bearing real estate trust account or a non-interest-bearing trust account for real estate funds other than client funds.
The buyers want their earnest money to be held by their attorney. Who is the correct person to draft the agreement stating the buyer’s wishes regarding their earnest money?
A. An attorney.
B. Seller’s listing agent.
C. Buyer’s broker.
D. None of the above.
A. If the parties choose to have someone other than the firm hold the monies, the parties or an attorney should draft an escrow agreement.
Client funds do NOT include:
A. Promissory notes.
B. Earnest money.
C. Down payments.
D. Additional earnest money.
A. Chapter 452.13(1)(a): Client funds means all down payments, earnest money deposits or other money related to a conveyance of real estate that is received by a firm or its licensees on behalf of a principal or any other person. 452.13(1)(a) specifically states that client funds do not include promissory notes.
The interest from an interest-bearing real estate trust account is annually remitted to the:
A. Department of Safety and Professional Services.
B. Department of Motor Vehicles.
C. Department of Administration.
D. Department of Finance.
C. Interest from the IBRETA account is calculated by the depository institution and annually remitted to the Department of Administration and is used for homeless assistance programs.
Generally, a firm must deposit real estate trust funds within which period?
A. 24 hours.
B. 72 hours.
C. Two working days.
D. 48 hours.
D. REEB 18.031: A firm shall deposit all real estate trust funds received by the firm or its licensees in a real estate trust account within 48 hours of receipt of the trust funds.
