California Real Estate Practice Exam

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Study for the California Real Estate Exam with confidence. Engage with interactive questions designed to enhance your understanding of real estate principles, laws, and practices. Prepare thoroughly for your licensing test and ensure you have the knowledge to succeed in your real estate career!

Practice this question and more.

For what reason can a broker's personal business funds be placed in the trust he maintains?

To lend to clients
To pay personal expenses
To pay service charges and fees to maintain the trust fund
To invest in real estate

The correct answer is: To pay service charges and fees to maintain the trust fund

A broker's personal business funds should not be placed in the trust he maintains for any reason. The trust fund is meant to solely hold funds on behalf of clients and any misuse of the trust, including using it for personal expenses or lending money to clients, would be considered a violation of fiduciary duty. Investing in real estate would also be considered a misuse of the trust fund. Therefore, the only correct reason for a broker to place personal business funds in the trust would be to pay for service charges and fees associated with maintaining the trust fund.