Contracts
A Mississippi broker receives a buyer's earnest money deposit while the offer is pending. Before the offer is accepted, the buyer withdraws the offer. The broker must:
AReturn the earnest money to the seller as liquidated damages
BReturn the earnest money to the buyer since no contract was formed; the buyer is entitled to the refund of their deposit✓ Correct
CHold the earnest money until the seller approves the refund
DDeduct their commission from the earnest money before returning it
Explanation
If an offer is withdrawn before acceptance (no contract formed), the buyer is entitled to a full refund of their earnest money deposit. No contract exists, so there is no basis for the seller to retain the funds. The broker must promptly return the deposit to the buyer without deductions.
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