Under TREC rules, a broker closes a pending transaction and prepares to disburse the earnest money from the trust account. The closing statement shows that the earnest money will be applied to the buyer's closing costs. Under TREC rules, which document authorizes the disbursement?
Correct Answer
C) The signed closing statement (HUD-1 or Closing Disclosure) and any applicable written instructions from the parties
Trust fund disbursements at closing are authorized by the signed closing statement and written instructions from the parties. These documents provide a clear record of how funds should be applied and protect all parties.
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