Contracts
In Colorado, an earnest money deposit in a real estate contract is best described as:
AThe full down payment paid at contract signing
BA good-faith deposit demonstrating the buyer's intent to purchase✓ Correct
CThe broker's commission held in trust
DA non-refundable fee paid to the seller
Explanation
Earnest money is a good-faith deposit made by the buyer to demonstrate serious intent to purchase. It is held in a trust or escrow account and applied to the purchase price at closing or returned/forfeited per contract terms if the deal falls through.
Related Colorado Contracts Questions
- In Colorado, which type of listing agreement gives the seller the right to sell the property themselves without owing the broker a commission?
- The Colorado Real Estate Commission-approved contract for the purchase and sale of residential property is called the:
- In Colorado, an 'as-is' clause in a real estate contract means:
- Under the Colorado Contract to Buy and Sell, the 'inspection objection' provision allows the buyer to object to conditions discovered during inspection. The seller's response options include all of the following EXCEPT:
- In Colorado, a listing agreement that automatically renews unless cancelled is called a(n):
- In the Colorado Contract to Buy and Sell, the 'closing date' refers to:
- Under a Colorado Contract to Buy and Sell, if the seller fails to close on the Closing Date, the buyer's remedies may include:
- Under the Colorado Contract to Buy and Sell, 'earnest money' is typically held by:
Practice More Colorado Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Colorado Quiz →