Podcast Beta
Questions and Answers
What type of accounts must a Responsible Broker use for deposits belonging to others?
Which of the following statements is true regarding the name of trust accounts maintained by a Responsible Broker?
What must the Responsible Broker include in the account heading of a trust or escrow account?
In what situation can a Responsible Broker withdraw funds from a trust or escrow account?
Signup and view all the answers
What types of money must be deposited into separate accounts by the Responsible Broker?
Signup and view all the answers
How should a Responsible Broker identify the entity for which they operate their trust account?
Signup and view all the answers
Which of the following is an example of money that is required to be placed into a trust or escrow account?
Signup and view all the answers
What must be done if a Responsible Broker conducts business as a real estate company?
Signup and view all the answers
What is required before money belonging to others can be invested in accounts with a fixed term for maturity?
Signup and view all the answers
When should money received in cash or check be deposited into the Responsible Broker's trust account?
Signup and view all the answers
What must a Responsible Broker maintain when trust funds are held by a funds holder?
Signup and view all the answers
What is a mandatory element of the transaction ledger maintained by the Responsible Broker?
Signup and view all the answers
How often should trust or escrow account journals and ledger liabilities be reconciled?
Signup and view all the answers
What should a Responsible Broker do if they collect money for services before those services have been performed?
Signup and view all the answers
What detail is NOT required to be included in the recordkeeping system for each funds holder account?
Signup and view all the answers
What happens to money belonging to one party if it needs to benefit another party?
Signup and view all the answers
Which of the following statements about a nonresident Responsible Broker is accurate?
Signup and view all the answers
What should happen after any withdrawal of principal’s funds from an account?
Signup and view all the answers
Study Notes
Brokers’ Trust or Escrow Accounts
- Licensed Responsible Brokers in Wyoming must deposit all money belonging to others in a separate trust or escrow account.
- This account must be held by a Wyoming funds holder, or in a Wyoming bank.
- Trust accounts can be any type of checking, demand, passbook or statement account insured by the United States government.
- Each trust account must be labeled with the word “trust” or “escrow”.
- Funds held in a trust account may not be invested in any type of asset that has a fixed term or maturity unless all parties in the transaction consent.
- The Responsible Broker is entitled to withdraw money from the account without a cosigner but other signatures may appear on the account.
- Money belonging to others must be deposited according to the purpose of the transaction into separate accounts (e.g., sales escrow, property management, security deposits, etc.).
- Money belonging to others received in cash or check must be deposited into the Responsible Brokers’ real estate company trust account or with the Responsible Broker’s funds holder by the first banking day after receipt.
- When funds are held by a funds holder, the Responsible Broker must obtain a receipt with the amount transferred to the funds holder.
- The Responsible Broker must maintain a recordkeeping system that includes information like the date received/paid, check number, amount, buyer, seller, escrow agent, date delivered, description of property, and disposition of the transaction.
- The Responsible Broker must maintain a recordkeeping system that includes a journal which includes the date, name of the party giving the money, principal's name, address or description of the real estate, and the amount.
- There must also be a transaction ledger showing receipts and disbursements which affect a particular transaction.
- The Responsible Broker is required to reconcile trust or escrow account journals and ledger liabilities monthly and prove agreement by comparing the cash balance showing in the account journal, the sum of the cash balances for all ledgers, and the corresponding bank account balance.
- Money belonging to one party cannot be used for the benefit of another party.
- Any instrument, equity, or thing of value received in lieu of cash must be held by the Responsible Broker unless all parties to the transaction make written arrangements otherwise.
- Nonresident Responsible Brokers licensed in Wyoming must maintain separate trust accounts with a Wyoming funds holder or in a Wyoming bank.
- There is no limit on the number of separate trust accounts or funds holder accounts a Responsible Broker can maintain.
- If funds are collected by a Responsible Broker for performance or services before the advertising or services are performed, the Responsible Broker must deposit the funds in a trust account or with a funds holder.
- Funds can only be withdrawn after the Responsible Broker has performed the service and only for actual expenses paid on behalf of the client.
- The Responsible Broker must provide a full and itemized accounting to the client within twenty (20) days of any withdrawal of funds.
- The Wyoming Real Estate Commission can audit a Responsible Broker’s trust or escrow account to ensure compliance with rules and statutes.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge of trust and escrow account regulations for licensed brokers in Wyoming. Discover the essential requirements for handling clients' funds and the rules governing these accounts. This quiz covers deposit guidelines, account types, and the responsibilities of responsible brokers.
