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Pass California

Practice and Disclosures, 25% of the examination

Commingling

Mixing a client's trust funds with the broker's own funds.

Commingling includes placing trust money in a general or personal account or placing broker-owned money in a trust account outside Regulation 2835's narrow allowances. A broker may maintain reasonably sufficient broker funds, not exceeding $200, for bank service charges. The regulation also addresses temporarily inseparable principal and broker funds and specified loan activities.

See also

Trust fundsMoney or other things of value received by a broker on behalf of another person in a transaction requiring a real estate license.ConversionUsing trust funds for a purpose other than the one for which they were entrusted.

Test the distinction

A relevant question from Practice and Disclosures, selected because its facts or explanation use this concept.

Practice and Disclosures ยท 25%Trust Account Management

How much of a broker's own money may sit in the trust account without it being commingling?

Written to DRE's published topic list. Not a real examination question, since reproducing those is a misdemeanor under B&P Code section 123.

Primary sources

Use these authorities when a course summary, forum answer, or older flashcard conflicts with the current California rule.

Where this is tested

Practice of Real Estate and DisclosuresThe exam's largest area. Learn trust funds, fair housing, advertising, supervision, DRE enforcement, property management and California disclosure rules as one practical system.25%Practice Practice and Disclosures72 questions on this area, every option explained.Practice

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