License Law and DRE Regulation Practice Question
Question
A seller is reviewing documents before accepting an offer involving commingling. What should a California real estate licensee understand? (Item 39)
Answer choices
- A. It applies only to commercial property and never to residential transactions.
- B. It is controlled only by local custom rather than by law, contract, or professional duty.
- C. Identify improper mixing of client funds with broker personal or business funds.
- D. It is valid only when the buyer pays cash and no lender is involved.
Correct Answer
C. Identify improper mixing of client funds with broker personal or business funds.
Explanation
The correct answer is C because commingling requires candidates to identify improper mixing of client funds with broker personal or business funds. 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: hard
- Domain: License Law and DRE Regulation
- Objective: commingling