Arkansas Real Estate Practice Exam

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How should earnest moneys and deposits be handled according to listing agreements?

Kept by the licensee until the sale closes
Forwarded to the listing firm's trust account promptly
Deposited into the broker's personal account for safety
Held in a third-party escrow account until closing

The correct answer is: Forwarded to the listing firm's trust account promptly

In order to properly handle earnest moneys and deposits according to listing agreements, they should be forwarded to the listing firm's trust account promptly. This ensures that the funds are handled according to legal and ethical standards and are protected for both the buyer and seller. Keeping the funds until the sale closes (Option A) may put the licensee at risk of mishandling the funds and not promptly forwarding them to the appropriate party. Depositing the funds into the broker's personal account (Option C) goes against the legal responsibility to keep client funds separate from personal funds. Additionally, holding the funds in a third-party escrow account until closing (Option D) is not the best option as it may delay the closing process and cause inconvenience to the parties involved. Therefore, Option B is the most appropriate and responsible choice for handling earnest moneys and deposits.