Finance
What is 'earnest money' in an Illinois real estate transaction and how is it typically handled?
AThe buyer's down payment deposited directly with the seller
BA good-faith deposit held in escrow by the broker or title company showing the buyer's intent to purchase✓ Correct
CA fee paid to IDFPR to register the transaction
DThe appraisal fee paid upfront to the lender
Explanation
Earnest money is a good-faith deposit made by the buyer to demonstrate serious intent to purchase. In Illinois, it is typically held in escrow by the listing broker's trust account or by the title company. If the transaction closes, earnest money is applied to the purchase price. If the buyer defaults, the seller may be entitled to retain it as liquidated damages.
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