Humber/Ontario Real Estate Course 3 Exam Practice

When should commission trust account funds be deposited?

1. Within five business days after receiving the deposit cheque

2. Immediately upon receipt of deposit

3. Upon closing of the property sale

4. Within ten business days of receiving the deposit

5. Only after the co-operating brokerage approves

6. Upon seller’s confirmation of receipt

The correct answer is: Within five business days after receiving the deposit cheque

The correct choice is that commission trust account funds should be deposited within five business days after receiving the deposit cheque. This aligns with standard practices in real estate transactions where timely handling of client funds is essential for transparency and trust. The five-business-day window provides a balance that allows the brokerage to ensure that the cheque clears and that the funds are appropriately recorded in their accounting systems. This process helps to avoid potential disputes or misunderstandings regarding the handling of deposits and is in line with regulatory guidance that dictates handling client funds with diligence. Immediate deposits may not take into account processing times or potential issues with the cheque, such as being returned due to insufficient funds. Similarly, waiting until the closing of the property sale would not meet the requirement for timely deposit handling, as client funds should be secured and accounted for as soon as possible. Options that depend on approvals or confirmations from others may also unnecessarily complicate the process and put client funds at risk if there is a delay in those approvals. Therefore, the stipulated five-business-day period ensures both compliance with regulations and protection for all parties involved in the transaction.