Trust Funds
If a listing expires without a sale, earnest money that was deposited should be:
ARetained by the listing broker
BTransferred to AREC
CIf no contract was ever formed, returned to any depositing party; if a contract was formed and failed, per agreement terms✓ Correct
DSplit evenly between buyer and seller
Explanation
If no contract was formed, deposits are returned to the depositing party. If a contract was formed and the listing expired before closing, disbursement follows the contract terms or mutual agreement.
Related Alabama Trust Funds Questions
- When an earnest money deposit is forfeited by a defaulting buyer, how are the funds typically distributed?
- Which of the following would be considered an acceptable reason to withdraw funds from a trust account?
- In Alabama, a qualifying broker who manages property for owners must maintain:
- If a disputed earnest money situation cannot be resolved between buyer and seller, the broker may interplead the funds. 'Interpleading' means:
- Which of the following is NOT a permissible use of an Alabama broker's trust account?
- Interest earned on Alabama broker trust accounts typically:
- When must an Alabama broker deposit earnest money received from a buyer into the trust account?
- When a real estate transaction closes, how should the earnest money be handled?
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