Contracts
In Iowa, earnest money that is being held in dispute may be:
AKept by the broker until the parties resolve the dispute
BReleased only by written agreement of both parties or by a court order✓ Correct
CReturned to the buyer automatically after 30 days
DForfeited to the seller as the default resolution
Explanation
When earnest money is in dispute, Iowa law generally requires the broker to hold the funds in the trust account until the parties reach a written agreement or a court orders the disposition. The broker may not unilaterally release funds to either party.
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