Trust Funds
After a real estate closing in Alabama, how quickly should trust funds be disbursed?
AWithin 30 days
BAs soon as practicable following closing, per contract instructions✓ Correct
COnly after AREC approval
DWithin 7 business days
Explanation
Following closing, trust funds should be disbursed as soon as practicable in accordance with the purchase contract terms and closing instructions.
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Key Terms to Know
Escrow
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
ProrationThe division of ongoing property expenses (taxes, HOA dues, rents) between buyer and seller at closing based on their respective days of ownership.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
State-Specific Concepts
Trust Account RulesAREC Regulation
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