Contracts
Under Illinois law, which of the following statements about earnest money is correct?
AEarnest money must be at least 10% of the purchase price
BEarnest money is required for a valid purchase contract
CEarnest money must be deposited within a reasonable time after acceptance of the contract✓ Correct
DEarnest money belongs to the seller immediately upon contract acceptance
Explanation
In Illinois, earnest money is not legally required for a valid contract (consideration can be nominal), and there is no minimum required amount. However, per Illinois license law, earnest money must be deposited in the broker's trust account within a reasonable time (typically within 24-48 hours) after being received.
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