Contracts

What is a 'deposit receipt' in the context of Hawaii real estate and how does it function?

AA. A receipt for the buyer's down payment at closing
BB. The initial document acknowledging receipt of the buyer's earnest money deposit along with the offer to purchase; the foundational purchase contract document in Hawaii transactions✓ Correct
CC. A bank receipt confirming the escrow account has been funded
DD. A receipt from the seller acknowledging they received the buyer's offer

Explanation

In Hawaii, the Deposit Receipt, Offer and Acceptance (DROA) begins as a 'deposit receipt' acknowledging the earnest money and embodying the buyer's offer. When the seller signs (accepts), it becomes a binding purchase contract. The deposit receipt aspect serves as the earnest money custodial document, while the offer and acceptance portion creates the contract.

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