Tennessee Realtor State Practice Exam

When will Millie's earnest money check be deposited?

1. Immediately after the offer is submitted

2. After the seller signs the contract

3. Immediately after the purchase offer is accepted by the seller

4. Within three days of acceptance

The correct answer is: Immediately after the purchase offer is accepted by the seller

The correct answer indicates that Millie's earnest money check will be deposited immediately after the purchase offer is accepted by the seller. This aligns with standard real estate practices, which stipulate that earnest money is a demonstration of the buyer's commitment to the transaction and is usually submitted with or immediately following the acceptance of the offer. When a seller accepts an offer, it signifies that both parties are in agreement concerning the terms of the sale, and thus it is appropriate for the earnest money to be deposited at this point. This process helps secure the property for the buyer and assures the seller of the buyer’s intent to move forward with the purchase. The timing of the deposit is an essential aspect of real estate transactions, as it helps ensure the parties involved are acting in good faith. By depositing the check immediately after acceptance, it solidifies the agreement and initiates the process leading up to closing. In contrast, other choices may imply a misunderstanding of the timeline or conditions of the earnest money deposit. For instance, suggesting that the deposit happens after the seller signs the contract overlooks the fact that acceptance of the offer typically occurs simultaneously with signing, and thus the deposit should happen right after acceptance. Similarly, an immediate deposit after the offer submission fails to acknowledge that an offer may