Which of the following is prohibited in real estate transactions in Indiana?

The correct answer is that commingling client funds with personal funds is prohibited in real estate transactions in Indiana. This principle is grounded in the necessity for ethical and transparent financial practices within the real estate profession. Real estate professionals are required to maintain strict boundaries between their own funds and those of their clients to ensure that clients' money is safeguarded and accounted for properly.

Commingling can lead to serious issues, including the inability to accurately track client funds, potential loss of client money, and legal ramifications for the agent or broker involved. The ethical standards set forth by the Indiana Real Estate Commission emphasize the importance of proper handling of client funds to maintain trust and integrity in real estate transactions.

In contrast, distributing marketing materials, conducting open houses, and offering incentives to clients are all permissible practices in the real estate industry, provided they conform to regulatory guidelines and ethical standards. These activities are important for business development and customer engagement but must be done in a professional manner that adheres to established rules.