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Escrow Account – Questions And Answers
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Escrow Account – Questions And Answers
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Escrow Account – Questions And AnswersChuck, 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 Correct Ans - mail it, special
delivery, to his broker
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 Correct Ans -
the broker may keep the interest
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
Correct Ans - placing earned commissions in the same account as
earnest money deposits
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 Correct Ans -
contract specifies the beneficiary of any earned interest
, 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 Correct Ans - all
parties to the transaction have agreed, in writing
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 Correct
Ans - a referral fee received from an out of state broker
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 Correct Ans - put this info in the written
offer
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 Correct Ans - endorse the check
and give it to bob
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