Before you read
Test yourself first: 5 questions
Question 1 of 5
Maryland's Real Estate Guaranty Fund primarily provides what protection to the public?
Answer: C. The Maryland Real Estate Guaranty Fund compensates consumers who suffer an actual financial loss caused by a licensee's wrongful act (such as fraud, misrepresentation, or conversion of trust funds) when they are unable to recover from the licensee. It is a consumer-protection fund, not insurance for the broker.
Question 2 of 5
A Maryland salesperson personally receives an earnest money deposit at a listing presentation. Under Maryland Real Estate Commission rules, what must the salesperson do with that deposit?
Answer: B. In Maryland, all trust money belongs to the broker's responsibility. A salesperson who receives a deposit must promptly turn it over to the broker, who is obligated to place it in the brokerage's trust/escrow account. The salesperson may never hold client funds personally.
Question 3 of 5
A dispute arises over who is entitled to an earnest money deposit being held in a Maryland broker's trust account. What is the broker's proper course of action?
Answer: C. When entitlement to a deposit is disputed, the Maryland broker must keep the money in trust and may not unilaterally decide who gets it. The funds stay in escrow until the parties agree in writing, a court directs distribution, or another lawful resolution (such as interpleader) occurs.
Question 4 of 5
In Maryland, earnest money and other client funds held by a brokerage must be:
Answer: C. Maryland law requires client deposits to be placed in a separate trust/escrow account; commingling client funds with brokerage operating funds is prohibited.
Question 5 of 5
When a Maryland salesperson receives an earnest money deposit on a transaction, the funds must be:
Answer: A. Deposits belong to the principals and must be turned over to the broker and held in the broker's trust/escrow account, never commingled with personal funds.
Keep the streak going with more questions like these, each with a full rationale.
What you need to know
License renewal requires completing approved continuing education during each renewal cycle to keep the license active. Maryland also maintains a Real Estate Guaranty Fund, which can compensate consumers who suffer actual monetary losses caused by a licensee's fraud, misrepresentation, or misuse of funds.
Maryland Escrow Funds, License Renewal, and the Guaranty Fund: FAQs
Is Maryland Escrow Funds, License Renewal, and the Guaranty Fund on the real estate exam?
Yes. State License Law is a scored domain on the Maryland real estate licensing exam, and this topic appears in the state license-law portion.
Is this cheat sheet free?
Yes — every page on Cinna RE's resource library is free to read, print and share. The app adds practice questions, mock exams and a readiness score.
Does Maryland test this differently?
Maryland applies its own license law on top of the national portion. This page covers the Maryland rules specifically, which is what the state section of your exam tests.
