Question

All "money belonging to others" accepted by a resident or non-resident broker doing business in this state shall be deposited in which of the following?

1) An attorney's trust account
2) The title company's trust account within 24 hours of receipt
3) One or more accounts separate from other money belonging to the broker
4) The broker's operating account within the first business day of receipt

Answer 1

Money belonging to others accepted by brokers must be deposited into separate accounts to ensure client money is secured and not mixed with the broker’s operating funds.

Step-by-step explanation:

All money belonging to others accepted by a resident or non-resident broker doing business in this state shall be deposited into one or more accounts separate from other money belonging to the broker. This requirement is designed to protect the funds of clients and ensure that there is no commingling of clients' money with the broker's operational funds. These separate accounts can be similar to escrow accounts, where money is held securely until the fulfillment of a condition or completion of a transaction, such as the buyer meeting the conditions for purchase or the property title being transferred.