Upon receiving a deposit on a real estate transaction, a salesperson must deliver it to which party?

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Multiple Choice

Upon receiving a deposit on a real estate transaction, a salesperson must deliver it to which party?

Explanation:
Handling earnest money properly means recognizing that the deposit is trust money that must be safeguarded by the broker. When a salesperson receives a deposit, it should be delivered to the employing broker promptly so it can be placed into the broker’s trust account and accounted for under the contract terms. The broker, not the buyer or seller, oversees the funds and disburses them according to the agreement or closing instructions, ensuring proper fiduciary handling and compliance with real estate laws. A mortgage lender would not hold the deposit unless explicitly directed, which isn’t the standard practice.

Handling earnest money properly means recognizing that the deposit is trust money that must be safeguarded by the broker. When a salesperson receives a deposit, it should be delivered to the employing broker promptly so it can be placed into the broker’s trust account and accounted for under the contract terms. The broker, not the buyer or seller, oversees the funds and disburses them according to the agreement or closing instructions, ensuring proper fiduciary handling and compliance with real estate laws. A mortgage lender would not hold the deposit unless explicitly directed, which isn’t the standard practice.

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