Broker Sarah receives a $5,000 earnest money deposit from buyer Johnson for a property purchase. The contract states the deposit should be held in escrow. According to Florida law, what must Sarah do with this deposit?
Correct Answer
B) Deposit it in a separate escrow account within 3 business days
Correct: Florida law requires earnest money deposits to be placed in a separate escrow account within 3 business days of receipt. Why not A: Personal accounts cannot be used for client funds. Why not C: Funds must be held in escrow, not given directly to seller. Why not D: Cash storage is not proper escrow handling.
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Scenario Cedar File raises this Florida point. In a Tallahassee transaction, a closing coordinator wants the Florida rule on disputed earnest money. Which statement is correct?
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A buyer makes an offer on a $450,000 home with earnest money equal to 2% of the purchase price. How much earnest money must be deposited?