Contracts
What is the purpose of an 'earnest money' deposit in a New Hampshire purchase and sale agreement?
AIt pays for the home inspection
BIt demonstrates the buyer's good faith and is applied toward the purchase price at closing✓ Correct
CIt is the broker's commission paid in advance
DIt funds the title insurance premium
Explanation
Earnest money is a good-faith deposit that demonstrates the buyer's serious intent to purchase. It is held in escrow and typically applied to the buyer's down payment or closing costs at closing.
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