PSI Virginia Real Estate Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the PSI Virginia Real Estate Exam with flashcards and multiple choice questions, each featuring hints and explanations. Get ready to ace your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

What does it mean if a broker holds funds in a trust account?

The funds are available for any personal use
The funds are kept separate from personal funds
The funds belong to the broker
The funds can be used to pay bills directly

The correct answer is: The funds are kept separate from personal funds

A broker holding funds in a trust account signifies that these funds must be maintained separately from the broker's personal funds. This separation is crucial for maintaining transparency and ensuring that clients’ money is safeguarded. Trust accounts are designed specifically for clients’ funds—such as earnest money deposits, rental payments, or other types of client deposits—and must be used solely for these designated purposes. This practice not only fulfills ethical obligations but also complies with legal requirements, protecting both the broker and the clients. By clearly delineating client funds from personal or business funds, brokers prevent potential issues related to commingling, which can lead to legal trouble or breaches of fiduciary duty. In any real estate transaction, the proper handling of trust accounts instills trust and confidence among clients, showcasing professionalism and adherence to regulatory standards.