Florida Real Estate Sales Associate Examination Content OutlineReal Estate Brokerage Activities and ProceduresMedium
A Florida real estate sales associate receives an earnest money deposit check from a buyer on Friday afternoon. The sales associate delivers the check to their broker on Monday morning. The broker then deposits the check into the brokerage's escrow account on Wednesday. According to Florida law, has the sales associate or broker violated any regulations regarding the handling of earnest money?
- AThe sales associate violated regulations by not depositing the check themselves.
- BNeither the sales associate nor the broker violated regulations.
- CThe broker violated regulations by not depositing the check within the required timeframe.
- DBoth the sales associate and the broker violated regulations.
Show answer & explanationAnswer & explanation
Correct answer: C. The broker violated regulations by not depositing the check within the required timeframe.
Florida law requires a sales associate to deliver earnest money deposits to their broker by the end of the next business day. The broker must then deposit these funds into an escrow account no later than the end of the third business day following receipt.
Why the other options are wrong
- A. Sales associates are not permitted to deposit earnest money checks directly into an escrow account; they must deliver them to their broker.
- B. The sales associate delivered the check to the broker on Monday, which was the next business day after receiving it on Friday. The broker received the check on Monday and deposited it on Wednesday. The broker has until the end of the third business day following receipt to deposit the funds. Since Monday was the first business day, Tuesday the second, and Wednesday the third, the broker deposited it within the required timeframe. Therefore, neither violated regulations.
- D. The sales associate delivered the check on the next business day (Monday), which is compliant. The broker received it Monday and deposited it Wednesday, which is also compliant (by end of Thursday was the deadline). Therefore, neither violated regulations.
Earnest Money Deposit Timelines (FL)
In Florida, sales associates must deliver earnest money deposits to their broker by the end of the next business day. Brokers must then deposit these funds into an escrow account by the end of the third business day following receipt.
- Sales associate to broker: end of next business day.
- Broker to escrow account: end of third business day after broker's receipt.
- Weekends and holidays are not counted as business days.
Memory trick: Sales Associate's Next Day Dash, Broker's Three-Day Bank Splash.