ContractsEarnest_money_and_escrowEASY
A transaction closes successfully. What typically happens to the earnest money?
Correct Answer
C) It is applied as a credit toward the buyer's purchase price
At closing, earnest money is typically credited toward the buyer's total purchase cost, reducing the amount due at closing.
Answer Options
A
It is returned to the buyer after closingB
It is kept by the broker as commissionC
It is applied as a credit toward the buyer's purchase priceD
It is donated to a housing charityWhy This Is the Correct Answer
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Background Knowledge for Contracts
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Key Terms:
earnest_money_and_escrowcontractsclosing_creditapplication
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