escrow accounts

which of the following actions is an example of commingling? 1. placing earnest money from two buyers into the same escrow account 2. using personal funds to open an escrow account 3. placing earned commissions in the same account as earnest money deposits 4. placing earned commissions in the same account as referral fees

placing earned commissions in the same account as earnest money deposits

Mitch, the principal broker at ZYX Firm, has reasonable suspicion that one of his associate brokers is stealing escrow funds. As a principal broker, Mitch must report this violation within how many business days? 1. 5 2. 4 3. 3 4. 2

3

a real estate transaction does not go to settlement. under what circumstances can the escrow funds be released? 1. an attorney handling the settlement may release the funds 2. a broker may disburse the funds with permission of the seller 3. a court must order disbursement 4. a broker may disburse the funds with written approval of all parties

a broker may disburse the funds with written approval of all parties

A party defaults during the executory period of a valid real estate contract. As a condition of the contract, the broker must hold any funds in his possession until: 1. the seller advises the broker that the contract has been breached 2. the lending institution has advised the broker that the loan application was rejected 3. the attorney for the non defaulting party orders a release of the funds 4. a court of competent jurisdiction orders disbursement

a court of competent jurisdiction orders disbursement

which payment does NOT need to be held in an escrow account? 1. money received as a security deposit for rental property 2. a referral fee received from an out of state broker 3. an earnest money deposit, if closing is scheduled in less than 15 days 4. an earnest money deposit, if the amount is less than $250

a referral fee received from an out of state broker

when a broker establishes an account to hold money belonging to others, which of the following statements is true? 1. all checks, deposit slips, and bank statements must include the word "escrow" as part of the account name 2. accounts may be labeled as trust or escrow 3. the money cannot be held in the same bank as the brokers operating account 4. an individual account is required for each transaction

all checks, deposit slips, and bank statements must include the word escrow as part of the account name

a broker is NOT required to hold money in an escrow account if: 1. the deposit is less than $500 2. all parties to the transaction have agreed, in writing 3. closing is scheduled in less than 30 days 4. the purchaser is a non profit organization

all parties to the transaction have agreed, in writing

A broker received an earnest money deposit to support a valid contract. If the contract is breached and does not close, the broker is required to hold the escrow funds until: 1. the buyer requests for the deposit be returned 2. the broker receives notice of the breach of contract from an attorney 3. all principals to the contract agree to the intended distribution 4. the non defaulting party threatens legal action

all principals to the contract agree to the intended distribution

an escrow account is required to: 1. be opened by a broker to hold money that belongs to another party 2. be opened to ensure that all affiliates and employees will be paid regularly 3. be an interest bearing account 4. have a minimum balance of 500

be opened by a broker to hold money that belongs to another party

if a contract of sale is not consummated, how are escrow funds disbursed? 1. by the settlement attorney, with permission of all parties 2. by the broker, with written permission of the seller 3. by the broker, according to the terms of the contract if neither party files a written objection 4. by the broker, only upon notification of the court

by the broker, according to the terms of the contract if neither party files a written objection

earnest money deposits may be placed in interest bearing accounts if the: 1. contract specifies the beneficiary of any earned interest 2. account earns a minimum of 5% interest 3. account is properly title as escrow 4. interest is divided between the cooperating brokers

contract specifies the beneficiary of any earned interest

a broker receives a deposit for escrow. in this situation, the broker would violate board regulations if he: 1. places the money in an interest bearing account 2. obtains permission to have any earned interest credited into his personal account 3. does not advise the principals on how any earned interest will be distributed 4. places the money in an account that is not interest bearing

does not advise the principals on how any earned interest will be distributed

brenda the salesperson is employed by broker bob. she receives a check from alex as a thank you for the excellent job she did in finding a buyer. in this instance, brenda should: 1. cash the check, because it was a tough sale and she earned the money 2. endorse the check and give it to bob 3. put the check in her escrow account 4. cash the check, but inform bob

endorse the check and give it to bob

A contract cannot be consummated due to a disagreement between buyer and seller. The broker still has the earnest money deposit in his escrow account. The seller demands that the deposit be given to him, but the buyer demands that the deposit be returned to her. What can the broker legally do? 1. immediately return the funds to the buyer 2. immediately give the funds to the seller 3. retain the funds as commission 4. hold the funds until ordered by the court to disburse

hold the funds until ordered by the court to disburse

Chuck, lives in a rural area and sells real estate on a part-time basis. He only goes into his broker's office twice a month because it is not near his home. Chuck obtains a valid contract for one of his listed properties. What should he do with the earnest money deposit supporting this contract? 1. deposit it into the escrow account which he has established near his home 2. mail it (special delivery) to his broker 3. keep it with the contract until his next visit to the brokers office 4. give it to the seller for safekeeping

mail it (special delivery) to his broker

Chuck, lives in a rural area and only sells real estate on a part-time basis. He only goes into his broker's office twice a month because it is not near his home. Chuck obtains a valid contract for property he listed. What should Chuck do with the earnest money deposit supporting this contract? 1. deposit it in his escrow account, which he has established near his home 2. mail it, special delivery, to his broker 3. keep it with the contract until his next visit to the brokers office 4. give it to the seller for safekeeping

mail it, special delivery, to his broker

which of the following would NOT be a violation of board regulations? 1. placing an earnest money deposit into a regular operating account 2. placing an earnest money deposit into a separate escrow account 3. paying for a CRV and a credit report out of escrow account 4. turning the deposit over to a seller

placing an earnest money deposit into a regular operating account

which of the following actions is NOT a violation of VA license law? 1. placing an earnest money deposit in an interest bearing account, but failing to advise all parties of that fact 2. accepting a net listing 3. refusing to cooperate on the sale of property listed exclusively 4. showing a home to a prospective buyer before the owner has signed a listing agreement

refusing to cooperate on the sale of property listed exclusively

which of the following contracts provides instructions for the distribution of escrow money? 1. deed 2. mortgage 3. sales contract 4. listing contract

sales contract

if a broker holds an earnest money deposit in an interest bearing escrow account, what is the disposition of any earned interest? 1. it is, by regulation, credited to the buyer 2. it is always credited to the seller at closing 3. the broker may keep the interest 4. escrow accounts cannot, by regulation, earn interest

the broker may keep the interest

if an earnest money deposit is held by a broker in an interest bearing escrow account, what is the disposition of the interest earned? 1. it is, by regulation, credited to the buyer 2. it is always credited to the seller, at closing 3. the broker may keep the interest 4. escrow accounts cannot, by regulation, earn interest

the broker may keep the interest

when can a broker remove money from his escrow account? 1. at the time the buyer occupies the property 2. when directed to do so by the seller 3. when closing is completed 4. any of the above

when closing is completed

A broker has the buyer's earnest money deposited in an escrow account. The amount of the deposit exceeds the amount of the broker's commission for the sale. The broker can ONLY remove his commission for the sale: 1. when the buyer moves into the property 2. when the seller moves out of the property 3. when the closing is completed 4. whenever the seller says its fine to do so

when the closing is completed

a salesperson who receives an earnest money deposit is NOT required to place the money in an escrow account: 1. with the knowledge and consent of the parties 2. with the permission of his or her broker 3. with the written agreement of both parties 4. until 10 days prior to settlement

with the written agreement of both parties

how long must a broker keep copies of escrow records? 1. 2 years from the date of consummation or ratification of the contract 2. 3 years from the date the transaction was originated 3. 3 years from the date of consummation or ratification of the contract 4. 5 years from the date the transaction was originated

3 years from the date of consummation or ratification of the contract

which funds would NOT need to be held in an escrow account? 1. money received as a security deposit for rental housing 2. an earnest money deposit, if closing is scheduled in less than 15 days 3. an earnest money deposit of less than 500 4. a commission received from an out of state broker

a commission received from an out of state broker

if a broker receives a deposit for escrow, his handling of the deposit would be in violation of VA license regulations if he: 1. places the money in an interest bearing account 2. has the earned interest credited to his personal account, with permission from all parties involved in the transaction 3. does not advise the principals of exactly how the deposit will be distributed 4. places the money in a non interest bearing account

does not advise the principals of exactly how the earned interest on the deposit will be distributed

A broker manages three separate properties for the same owner. One property is in need of emergency repairs, but there is no money in the management account to cover the cost. The broker "borrows" money from another property's escrow account to make the needed repairs. Assuming he restores the borrowed funds on the next business day, which of the following statements is true? 1. the broker acted properly by safeguarding his clients interests 2. the broker is in violation of license law for improperly handing escrow funds 3. such action by the broker is proper because all properties are owned by the same person 4. the broker is required to make the repairs with his own funds, then receive reimbursement from the owner

the broker is in violation of license law for improperly handing escrow funds

a broker receives an earnest money deposit from the buyer on thursday. when is the latest day he can deposit it into his escrow account without violating VREB rules? 1. within 2 banking days 2. within 3 banking days 3. within 4 banking days 4. within 5 banking days

within 5 banking days

as a property manager, a broker should maintain a bank account for money that belongs to the owner. how is this account identified? 1. escrow account 2. operating account 3. reserve account 4. miscellaneous account

escrow account

money or trust instruments received, accepted, or held on behalf of another pending consummation or termination of a real estate transaction are: 1. commissions 2. down payments 3. escrow funds 4. anticipated profits

escrow funds

in which circumstance would a broker be guilty of commingling funds? 1. placing rental security deposits in the same escrow account as earnest money deposits 2. by placing personal funds in the same account as funds belonging to the salespersons and employees 3. placing rental security deposits in the same account as the property operating funds 4. using the same financial institution an escrow account and a personal account

placing rental security deposits in the same account as the property operating funds

a buyer gives her salesperson a note, payable at settlement, as an earnest money deposit for a home. the salesperson must do which of the following actions? 1. put this info into the written offer 2. immediately give the note to her broker for deposit in the escrow account 3. immediately call the seller on the phone 4. tell the buyer to forget it

put this info in the written offer

a broker could remove money from her escrow account under all of the following circumstances, EXCEPT: 1. with a written agreement of all of the parties 2. rescission by the buyer 3. termination of the contract, by full performance 4. as a result of a court order

rescission by the buyer

broker tom can remove money from his escrow account in all of the following circumstances, except: 1. when a court orders the broker to do so 2. with written permission of all parties to the contract 3. rescission of the contract by the seller 4. termination of the contract, by performance

rescission of the contract by the seller