Iowa License Law
Iowa's IREC rule regarding 'earnest money disbursement disputes' states that when buyer and seller both claim entitlement to earnest money, the broker should:
ASplit the deposit equally between the parties
BRetain the funds in the trust account until the dispute is resolved by written agreement of both parties, court order, or interpleader action✓ Correct
CRelease the funds to the seller as the default beneficiary
DReturn the funds to the buyer pending any dispute
Explanation
When a dispute arises over earnest money, an Iowa broker must hold the funds in the trust account until receiving a written agreement from both parties, a court order directing disbursement, or filing an interpleader action to let the court determine ownership.
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