ContractsEarnest_money_and_escrowMEDIUM
Is earnest money legally required for a valid real estate purchase contract?
Correct Answer
D) No, earnest money is customary but not legally required for contract formation; mutual promises provide consideration
Earnest money is customary but not legally required. Mutual promises of the buyer and seller provide adequate consideration for contract formation.
Answer Options
A
Yes, without earnest money the contract is voidB
Yes, the minimum amount is set by state lawC
No, but the contract must include a promissory note insteadD
No, earnest money is customary but not legally required for contract formation; mutual promises provide considerationWhy This Is the Correct Answer
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