A Minnesota real estate broker, Angela, received a written earnest money check of $6,000 from buyer Paul on a Monday. Under Minn. Stat. Ch. 82 and MN DOC rules, by when must Angela deposit the earnest money into her trust account?
Correct Answer
A) By the end of the third business day following receipt of the earnest money
Under Minn. Stat. Ch. 82 and MN DOC rules, a real estate broker who receives earnest money or other trust funds must deposit those funds into the broker's trust account by the end of the third business day following receipt. This is a mandatory requirement designed to protect the parties' funds and ensure proper accounting. Angela received the check on Monday, so she must deposit it by the end of Thursday (the third business day after Monday, assuming no holidays).
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Related Topics & Key Terms
Key Terms:
Related Concepts
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
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