Arkansas Real Estate Practice Exam

Question: 1 / 400

What does 'trust funds' mean in real estate transactions?

Funds that belong to the principal broker

Any high-value transactions

Money or other value not belonging to the broker but received in connection

In real estate transactions, trust funds refer to money or other valuable assets that are managed by a third party on behalf of the buyer or seller. These funds may include earnest money, down payments, or other payments related to the real estate transaction. Option A is incorrect because trust funds do not necessarily only belong to the principal broker. Option B is incorrect because trust funds are specifically related to real estate transactions, not just any high-value transactions. Option D is incorrect because trust funds may also be used for other purposes, such as paying for inspections or closing costs. Only option C correctly captures the definition of trust funds in real estate transactions.

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Only funds that are to be used for purchasing property

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