Contracts
In a Tennessee real estate purchase contract, earnest money serves as:
AThe buyer's guarantee to close regardless of contingencies
BEvidence of the buyer's good faith and part of the consideration✓ Correct
CCompensation for the real estate agents
DPayment toward the seller's closing costs
Explanation
Earnest money demonstrates the buyer's good faith and becomes part of the consideration for the contract. It is typically applied toward the purchase price or closing costs at settlement.
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