Escrow & Title
A Washington escrow company holds $50,000 in earnest money when the buyer and seller have a dispute about who is entitled to the funds. The escrow company's proper course of action is:
ARelease funds to the seller because they own the property
BRelease funds to the buyer because they paid them
CHold the funds and seek written agreement or file an interpleader action with the court✓ Correct
DAsk the listing broker to resolve the dispute
Explanation
When parties dispute earnest money, the escrow company is in a neutral position and cannot unilaterally decide who gets the funds. The proper response is to hold the funds and either obtain a written signed release agreement from both parties or file an interpleader action with the court.
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