Earnest money and other entrusted funds must be deposited promptly into the broker's escrow/trust account.
Before you read
Test yourself first: 5 questions
Question 1 of 5
When a Pennsylvania licensee prepares an agreement of sale, RELRA requires which of the following regarding contract terms?
Answer: B. RELRA and Commission rules require agreements of sale to include the material terms and required disclosures, and that the parties receive copies. Real estate sale contracts must be in writing to be enforceable under the statute of frauds.
Question 2 of 5
A Pennsylvania salesperson personally receives an earnest-money check from a buyer. What is the salesperson required to do with it?
Answer: C. In Pennsylvania a salesperson handles money only on behalf of the employing broker. Funds received must be promptly turned over to the broker, who is responsible for depositing them into the broker's escrow account. The salesperson may never hold client funds personally.
Question 3 of 5
In Pennsylvania, deposit or earnest money received by a broker on behalf of others must be:
Answer: C. Pennsylvania requires brokers to deposit funds belonging to others, such as earnest money, into a separate escrow (trust) account. Commingling these funds with the broker's own money is prohibited.
Question 4 of 5
Mixing client escrow funds with a broker's own business funds in Pennsylvania is known as and constitutes:
Answer: A. Commingling is the improper mixing of clients' funds with the broker's own funds. Pennsylvania prohibits commingling; client deposits must be kept in a separate escrow/trust account.
Question 5 of 5
In Pennsylvania, who is ultimately responsible for the maintenance and integrity of the brokerage's escrow account?
Answer: C. The broker of record is ultimately responsible for the proper handling and recordkeeping of the brokerage's escrow/trust account, including ensuring funds are not commingled or misused.
Keep the streak going with more questions like these, each with a full rationale.
Must-know rules
- Sellers of residential property must provide the buyer a Seller's Property Disclosure Statement before an agreement of sale is signed.
- The Consumer Notice on agency is delivered at the first substantive contact.
- Earnest money and other entrusted funds must be deposited promptly into the broker's escrow/trust account.
- Brokers must keep entrusted money separate from their own funds — commingling is prohibited.
- Disputed escrow funds must be retained in the trust account until the dispute is resolved or proper authorization to release is obtained.
- Pennsylvania is NOT a community-property state, so marital property is not split under community-property rules.
- Brokers must maintain complete transaction and trust-account records available for Commission inspection.
Pennsylvania Required Disclosures & Escrow/Trust Timeframes: FAQs
Is Pennsylvania Required Disclosures & Escrow/Trust Timeframes on the real estate exam?
Yes. State License Law is a scored domain on the Pennsylvania 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 Pennsylvania test this differently?
Pennsylvania applies its own license law on top of the national portion. This page covers the Pennsylvania rules specifically, which is what the state section of your exam tests.
