Discuss Real Estate Licensing RePA_Sales_S Exam Topic 4 Question 16

Interest earned on an escrow account is:

APayable to the broker holding the deposit.

BEqually divided between the buyer and seller.

CEqually divided between the listing and selling brokers.

DPayable subject to an agreement between the parties.

Suggested Answer: D

Under 49 Pa. Code 35.326 (Escrow Accounts and Interest), interest earned on escrow accounts belongs to the party or parties as determined by the terms of the contract or agreement.

A broker cannot personally benefit from interest earned on escrow funds unless the contract explicitly allows it.

The purchase agreement must specify how the interest is handled, whether it is payable to the buyer, seller, or split between parties.

Why the other answers are incorrect:

Option A (Payable to the Broker): A broker cannot keep interest from an escrow account unless agreed upon in writing.

Option B (Equally Divided Between Buyer and Seller): Interest division is not automatic; it must be outlined in the contract.

Option C (Equally Divided Between Brokers): Brokers do not have rights to escrow interest unless explicitly agreed upon.

49 Pa. Code 35.326 -- Escrow Accounts and Interest

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15 comments · newest first

Elouise 1 month ago

D is the best answer. Flexibility is key!

Augustine 1 month ago

C is tricky. Brokers usually have their own deals.

Desmond 1 month ago

B sounds fair, but not always realistic.

Roxane 2 months ago

A seems wrong. Brokers shouldn't just take it.

Chaya 2 months ago

I agree, D makes sense. It's all about the parties' choice.

Brittney 2 months ago

I think it's D. The agreement matters.

Christiane 2 months ago

This is new info for me! I had no idea it could vary like that.

Sharika 2 months ago

Wait, are you sure? I thought it was split between the buyer and seller.

Pedro 2 months ago

Definitely D! That's how it works in most cases.

Penney 3 months ago

I thought it went to the broker holding the deposit?

Kenia 3 months ago

It's usually payable subject to an agreement between the parties.

Macy 3 months ago

I’m leaning towards option D, but I feel like I need to double-check the rules on escrow interest distribution.

Shaquana 3 months ago

This seems similar to a practice question we did about escrow accounts, and I think it was about agreements between the parties.

Hermila 3 months ago

I remember something about it being divided between the parties, but I can't recall if it’s equal or based on an agreement.

Justine 4 months ago

I think the interest on an escrow account might be payable to the broker, but I’m not entirely sure.

Real Estate Licensing RePA_Sales_S Exam - Topic 4 Question 16 Discussion