Leasing and Property Management Practice Question
Question
An escrow officer requests clarification from the broker involving trust funds in management. Which statement best describes trust funds in management? (Item 26)
Answer choices
- A. It removes the need for written disclosure if the licensee believes the client already knows.
- B. Recognize owner and tenant funds must be handled according to trust-fund rules.
- C. It can be ignored if the transaction is expected to close quickly.
- D. It requires the licensee to favor the other party over the licensee’s own client.
Correct Answer
B. Recognize owner and tenant funds must be handled according to trust-fund rules.
Explanation
The correct answer is B because trust funds in management requires candidates to recognize owner and tenant funds must be handled according to trust-fund rules. The other options overstate the effect of custom, oral agreement, escrow, or independent salesperson action and do not reflect safe California exam practice.
Question details
- Difficulty: medium
- Domain: Leasing and Property Management
- Objective: trust funds in management