Contracts
Earnest money in a real estate transaction serves as:
APayment for the home inspection
BA deposit demonstrating the buyer's good faith and intent to purchase✓ Correct
CA nonrefundable fee paid to the listing broker
DAn advance payment of closing costs
Explanation
Earnest money is a deposit made by the buyer as evidence of good faith and the intent to complete the purchase. It is typically held in escrow by the listing broker or title company and is applied toward the purchase price at closing.
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