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Frequently Asked Questions - Earnest Money

  1. How long can I keep earnest money before I take it to the office?
  2. May a salesperson give earnest money back to the purchaser if he or she is still holding it and has not turned it in?
  3. How should a broker disburse earnest money that the buyer (or seller) is demanding?
  4. Should a broker hold the earnest money or let the seller hold it when the seller is a builder?

Q. How long can I keep earnest money before I take it to the office?

A. Earnest money must be turned over to the broker as soon after receipt as is practically possible. Your broker should provide you with written guidelines indicating how and when you should turn in earnest money. See License Law 43-40-25 (a )( 23) and Rule 520-1-.08.

Q. May a salesperson give earnest money back to the purchaser if he or she is still holding it and has not turned it in?

A. No, unless specifically directed to by your broker. Once you receive earnest money in behalf of your broker, the decision as to whom and when the money should be remitted rests solely with the broker. See License Law 43-40-25 (a )( 3) & (23) & Rules 520-1-.08.

Q. How should a broker disburse earnest money that the buyer (or seller) is demanding?

A. In accordance with the terms of the sales contract and the procedures outlined in Rule 520-1-.08.

Q. Should a broker hold the earnest money or let the seller hold it when the seller is a builder?

A. The party who holds the earnest money is controlled by the negotiation of the parties as expressed in the provisions of the sales contract.