Question

How must the broker as agent handle the receipt of security deposits and advance rent?

1) Place the funds in the broker's operating account
2) Post a surety bond for $50,000 and deposit the funds into the broker's operating account
3) Place the funds in an interest-bearing account in a Florida bank and pay the tenant 5% interest
4) Place the funds in the broker's escrow account

Answer 1

The broker should place the funds in the broker's escrow account to ensure they are held securely and separate from the broker's operating funds.

Step-by-step explanation:

The broker, acting as an agent, must handle the receipt of security deposits and advance rent by placing the funds in the broker's escrow account. This is done to ensure that the funds are held in a separate account and are not commingled with the broker's operating funds. The escrow account provides protection to the tenant, as the funds are held securely and can only be released according to the terms of the lease agreement.