Broker Martinez holds $5,000 in earnest money in her trust account for a pending transaction. The buyer and seller disagree about who is entitled to the earnest money after the contract falls through. Under TREC rules, what should Martinez do?
Correct Answer
A) Keep the funds in the trust account and not release them to either party without a written agreement or court order determining entitlement
Under TREC rules, when there is a dispute over earnest money, the broker must maintain the funds in the trust account and not release them without either a written agreement signed by all parties or a court order determining entitlement. The broker is not authorized to make unilateral decisions about disputed funds.
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