Escrow & Title
In Michigan, what is the purpose of an escrow account used in a real estate sale?
ATo hold the broker's commission until closing
BTo hold earnest money and other funds by a neutral third party until closing conditions are met✓ Correct
CTo pay the seller's mortgage directly
DTo reserve funds for property repairs
Explanation
An escrow is a neutral arrangement where a third party holds funds (earnest money, documents) on behalf of the parties to a transaction until all conditions are fulfilled and the transaction can close.
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