Humber/Ontario Real Estate Course 4 Exam Practice

Which of the following best defines how to handle a deposit in real estate trust accounts?

1. Funds exceeding broker’s earnings should be put into the commission trust account

2. Only the real estate trust account is necessary according to REBBA

3. Both commission and real estate trust accounts are mandated by REBBA

4. The real estate trust account should cover all disbursements

5. Commission trust account handles only earned remunerations while excess goes to a general account

6. Brokerages must reflect both accounts in all transactional records

The correct answer is: Only the real estate trust account is necessary according to REBBA

The best definition of how to handle a deposit in real estate trust accounts is that only the real estate trust account is necessary according to REBBA. This is because the Real Estate and Business Brokers Act (REBBA) emphasizes the importance of the real estate trust account for holding clients’ deposits safely and ensuring that those funds are not mixed with the brokerage's operational funds. The necessity of just the real estate trust account aligns with the regulatory requirements aimed at protecting consumer deposits. While the other options touch on aspects of how funds may be handled or account requirements, they introduce elements that are either not mandated by REBBA or suggest practices that do not align with the regulations set forth. For instance, discussing the need for a commission account or other variations may mislead an understanding of the primary focus REBBA has on the trust account's role in securing client funds.