Agency
A NH buyer's agent should explain to a buyer client that an earnest money deposit serves to:
APay the agent's commission in advance
BDemonstrate the buyer's good faith and provide the seller with recourse if the buyer defaults✓ Correct
CCover the closing attorney's fees
DOnly cover the home inspection cost
Explanation
Earnest money demonstrates the buyer's serious intent and good faith. If the buyer defaults without a valid contingency, the seller may be entitled to retain the earnest money as liquidated damages under the contract.
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