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12 exam questionsHigh Priority
Brokerage operations, escrow, advertising, and transaction procedures.
Quick Explanation
5 min readBrokerage activities involve escrow management, advertising rules, and transaction procedures. Key rules: sales associates deliver deposits to broker by NEXT business day; brokers deposit into escrow within 3 business days. Escrow disputes have 4 options: mediation, arbitration, interpleader, or EDO from FREC.
Key Points — What Matters for the Exam
1
Sales associate delivers deposit to broker: by END of NEXT business day2
Broker deposits into escrow: within 3 business days of receipt3
4 escrow dispute options: Mediation, Arbitration, Interpleader, EDO (from FREC)4
All advertising must include the brokerage name5
Commingling = mixing client funds with personal funds (ILLEGAL)6
Conversion = using client funds for personal use (ILLEGAL, criminal)7
Property management rent account must be SEPARATE from sales escrowMemory Trick
MAIE = escrow dispute options: Mediation, Arbitration, Interpleader, EDO. 'My Agent Is Excellent at resolving disputes.'
Common Trap Answers — Don't Fall For These
Sales associate delivers to broker NEXT business day (NOT same day)
Broker has 3 business days (NOT 1 day) to deposit into escrow
Broker CANNOT unilaterally return deposit to buyer without seller consent
Key Terms for This Unit (3)
Commingling
Illegally mixing client/escrow funds with personal or operating funds. Serious violation.
Conversion
Unauthorized use of client funds for personal purposes. Can result in criminal charges.
EDO (Escrow Disbursement Order)
An order from FREC directing how disputed escrow funds should be disbursed.