Realtor® Legal Tip – Two simple but important reminders about earnest money in this busy spring selling season
May 23, 2018
Author: Curtis Bullock
1) Earnest Money must be delivered to buyer’s brokerage within 4 days after acceptance. After that happens, the brokerage has another 4 calendar days to deposit the money into the trust account (if EM is going to a title company, then the same time frames apply and the REPC must include the Deposit of EM at Title Company Addendum). Not delivering the EM in time could result in a breach of contract.
2) How do you count the 4 days allowed to deliver the EM and the next 4 days to deposit the earnest money? You start by counting the day after the date of Acceptance. So if Acceptance occurred on Friday, don’t count Friday as day 1, start counting Saturday (1), Sunday (2), Monday (3) and then Tuesday (4). So Tuesday at 5 pm would be the deadline to deliver the earnest money to the brokerage. After that happens, the broker would have 4 days to deposit the funds.
If you don’t understand this stuff, hire a Realtor® who can help you navigate the largest investment of your life!