Practice Test Flashcards
1
Q
What are Texas real estate agents allowed to do with promulgated forms?
A
Texas real estate agents are allowed to use promulgated forms provided by TREC and fill in the blanks as necessary for a transaction. They are not permitted to draft new contracts, revise existing promulgated contracts, or provide legal advice unless they are also licensed attorneys.
2
Q
When does a real estate contract become legally binding?
A
A real estate contract becomes legally binding when all parties have signed or initialed the agreement and the acceptance has been communicated to the other party.
3
Q
What must listing contracts in Texas include regarding commissions?
A
Listing contracts in Texas must include a provision that real estate commissions are negotiable.
4
Q
What is permissible for a real estate agent regarding property title?
A
Telling the buyer known facts about the property that might affect the title is permissible for a real estate agent.
5
Q
Who is responsible for drafting and revising contracts and forms for real estate agents?
A
Drafting and revising contracts and forms for real estate agents is the primary responsibility of the Broker-Lawyer Committee.
6
Q
What is the effective date of a contract?
A
The effective date of the contract is when all parties have signed or initialed the agreement and the acceptance has been communicated to the other party.
7
Q
What is a Bilateral Contract?
A
A Bilateral Contract is a type of agreement where both parties have rights and obligations.
8
Q
What is Mutual Assent in contract law?
A
Mutual Assent is the agreement of all parties to all terms in a contract.
9
Q
What is an executed contract?
A
An executed contract is one where both parties have agreed to and signed the contract, making it legally binding.
10
Q
What does TRELA ensure regarding sales commissions?
A
TRELA ensures that sales commissions are always negotiable, protecting consumers and fostering fair competition.
11
Q
Is there a legal maximum commission rate in Texas?
A
No, because commissions are negotiable and not regulated by law.
12
Q
What does consideration refer to in a contract?
A
Consideration refers to something of value exchanged between parties in a contract.
13
Q
What is novation in contract law?
A
Novation is the substitution of a new contract for an existing one, effectively discharging the original contract.
14
Q
What is an option to buy in real estate?
A
An option to buy is a contract feature that allows a buyer to purchase a property within a specified time frame at an agreed-upon price.
15
Q
Is it appropriate to remove fixtures before showings?
A
Yes, because removing the chandelier before showings avoids confusion with potential buyers.
16
Q
How is the sale price in a real estate sales contract calculated?
A
The sale price in a real estate sales contract equals the down payment and financing added together.
17
Q
Are private transfer fees enforceable under Texas law?
A
Private transfer fees are not binding or enforceable under Texas law.
18
Q
What is a Buyer’s Temporary Residential Lease?
A
A Buyer’s Temporary Residential Lease is required when a buyer moves in before closing.
19
Q
What is a promulgated form?
A
A promulgated form is one that has been officially published and mandated for use in real estate transactions.
20
Q
Where are penalty funds from transfer fee violators placed?
A
Penalty funds collected from transfer fee violators are placed in the general revenue fund of the State.
21
Q
When is a temporary lease appropriate?
A
A temporary lease is appropriate for short-term situations, such as when the seller stays in the property for a few days after closing.
22
Q
What does the Title Policy and Survey paragraph ensure?
A
The Title Policy and Survey paragraph ensures that buyers are aware of any annexation-related issues that may affect the property.
23
Q
What is the Unimproved Property Contract designed for?
A
The Unimproved Property Contract is specifically designed for transactions involving land that has no improvements.
24
Q
What does the TREC Addendum for Back-up Contract allow?
A
The TREC Addendum for Back-up Contract allows a buyer to submit an offer on a home that already has a contract.
25
What should both parties do if the seller needs extra time after closing?
Both parties should sign the Seller’s Temporary Residential Lease.
26
What does TREC prohibit real estate agents from doing?
TREC prohibits real estate agents from getting involved in option contracts.
27
What must Charli pay at the time of execution of the back-up contract?
Charli must pay the seller any agreed-upon option money.
28
When does the lease under the TREC Seller's Temporary Residential Lease commence?
The lease under the TREC Seller's Temporary Residential Lease commences at closing and funding.
29
What is included in a mineral estate?
A mineral estate includes all oil, gas, and other minerals in or under a property.
30
Who typically pays for environmental assessments?
The buyer typically pays for environmental assessments as part of their due diligence.
31
What is erosion in relation to property?
Erosion is a natural process that can alter property boundaries along the coastline over time.
32
What is the Gulf Intracoastal Waterway?
The Gulf Intracoastal Waterway is a 1,300-mile canal that runs from Brownsville, Texas, to St. Mark's, Florida.
33
Why is it inappropriate for a real estate agent to write mineral rights terms into a contract?
It is inappropriate because this could be considered practicing law without a license.
34
Is altering wetlands without proper permits allowed?
No, altering wetlands without proper permits is prohibited.
35
What should a real estate agent advise the buyer regarding title examination?
The real estate agent is responsible for advising the buyer to have an attorney examine the abstract or obtain a title policy.
36
What does the TREC Seller's Disclosure Notice facilitate?
The TREC Seller's Disclosure Notice facilitates the seller meeting regulations concerning the disclosure of the condition of the property.
37
What is the TREC Texas Real Estate Consumer Notice Concerning Hazards or Deficiencies?
It is an informational document and does not require signatures from either the buyer or the seller.
38
What should the agent do with the TREC Notice to Prospective Buyer form?
The agent should give a copy of the TREC Notice to Prospective Buyer form to the buyer and retain the original in their file.
39
When is a TREC Seller's Disclosure Notice required?
A TREC Seller's Disclosure Notice is required when the transfer is from an investor in real estate.
40
What does the TREC Information About Brokerage Services form do?
The TREC Information About Brokerage Services form is used to inform the buyer and seller about the function of the real estate agent.
41
What triggers mandatory disclosure on lead-based paint?
Homes built prior to 1978 trigger the mandatory disclosure on lead-based paint.
42
What should be used when the seller wants to convey non-realty items?
The TREC Non-Realty Items Addendum should be used.
43
What is the minimum amount required by law for the option period?
$1.00 is the minimum amount required by law for the option period.
44
What does the TREC Addendum for Seller's Disclosure of Information on Lead-Based Paint provide?
It provides the buyer with 10 days from the effective date of the contract to inspect the property for lead-based paint hazards.
45
What is an executory contract?
An executory contract is a contract with closing 180 days or more.
46
Does TREC have a promulgated form for a contract for deed?
TREC has no promulgated form for a contract for deed.
47
What does it mean when a form is promulgated?
When a form is promulgated, it has been formally made public and its use mandated.
48
What is an initial counteroffer?
An initial counteroffer is the seller's offer to the buyer in response to the buyer's original offer.
49
Can TREC suspend a real estate agent's license?
Yes, TREC can suspend a real estate agent's license for failing to use a required contract form.
50
What should a real estate professional advise the buyer regarding title validity?
A real estate professional should advise the buyer to consult a title company or attorney for this type of advice.
51
Is the Residential Listing Agreement promulgated by TREC?
The Residential Listing Agreement is not promulgated by the Texas Real Estate Commission (TREC).
52
What type of contract would a new home builder most likely use?
A new home builder would most likely use a contract prepared by an attorney.
53
What is the Four Corners doctrine?
The Four Corners doctrine is used by judges to interpret a contract based solely on the language within the document.
54
What is consideration in a contract?
Consideration is something of value exchanged between parties in a contract.
55
What is a void contract?
A void contract has the same legal status as a contract that never existed.
56
What does a contract with an option to buy clause allow?
A contract with an option to buy clause allows a buyer to purchase a property within a specified time frame at an agreed-upon price.
57
What is the TREC Addendum for Sale of Other Property by Buyer used for?
It is used when a buyer needs to sell their current home before closing on a second home.
58
What does the Due on Sale clause do?
The Due on Sale clause may prevent a borrower from having another party assume the loan without the lender's approval.
59
What happens in a short sale regarding the effective date of the contract?
In a short sale, the effective date of the contract is amended to the date of notification if the buyer is informed of the bank’s approval.
60
Can a broker receive a fee from a Residential Service Company?
Yes, a broker could receive a fee from a Residential Service Company under some circumstances.
61
What is the Addendum for Release of Liability on Assumed Loan used for?
It is used if the seller wants to be released from any further liability in case of default.
62
Can a seller have another party assume her loan?
A seller can have another party assume her loan if the lender allows it.
63
What must happen for a short sale to proceed?
In a short sale, the lender holding the current mortgage must approve the transaction.
64
Who is required to sign the TREC Notice of Buyer's Termination of Contract?
Only the buyer is required to sign the TREC Notice of Buyer's Termination of Contract.
65
What must the seller disclose to the buyer?
The seller must disclose all material facts about the property to the buyer.
66
What should be submitted if the closing date needs to be changed?
Brittany's agent should submit an 'Amendment to Contract' with the new closing date.
67
What does an 80-10-10 loan program allow?
An 80-10-10 loan program allows the buyer to borrow 80% of the purchase price, put 10% down, and secure a second lien for the remaining 10%.
68
What is the TREC Subdivision Information form used for?
The TREC Subdivision Information form is used to request information from the Property Owners' Association (POA) to provide to the buyer.
69
What must be completed if both the seller and buyer agree to alter a signed contract?
The 'Amendment' form must be completed and signed by both parties.
70
What is price-fixing in real estate?
Price-fixing occurs when two or more real estate brokers work together to conspire to charge the same commission.
71
What does the Texas Sex Offender Registration Program website provide?
The Texas Sex Offender Registration Program website allows clients to access information regarding registered sex offenders.
72
What must be completed if both the seller and buyer agree to alter a binding, signed One to Four Family Residential Contract (Resale)?
The 'Amendment' form must be completed and signed by both parties. This ensures the changes are documented and legally binding.
73
What is price-fixing in real estate?
Price-fixing occurs when two or more real estate brokers conspire to charge the same commission. This is an antitrust violation and is illegal under federal law.
74
What does the Texas Sex Offender Registration Program website provide?
It allows clients to search for registered sex offenders in the area of a property they are interested in, ensuring buyers are informed about potential safety concerns.
75
What does FEMA provide to help buyers assess flood risks?
FEMA provides flood plain maps to help buyers determine if a property is located in a flood zone, which is critical for assessing potential risks and insurance requirements.
76
Why does the Residential Condominium Contract (Resale) not have a survey paragraph?
Surveys are typically not required for condominium units.
77
What is the TREC New Home Contract (Incomplete Construction) commonly used for?
It is most commonly used to purchase spec homes, designed for properties that are under construction but not yet completed.
78
What should Emily do if she likes the home and the seller's disclosure is acceptable?
The next step is to order a home inspection to be aware of any potential issues with the property before proceeding with the purchase.
79
How is the sales price calculated on the TREC New Home Contract (Completed Construction)?
The sales price is calculated as the cash portion plus the sum of all financing, ensuring clarity in the total amount the buyer is paying for the property.
80
What does the TREC Farm and Ranch Contract include in paragraph 3?
It includes a sales price adjustment that accounts for changes in the sales price due to factors like surveys or acreage discrepancies.
81
Why can surveys in Farm and Ranch transactions be expensive?
Surveys can be very expensive due to the large size of the properties, which is one reason why a survey may not always be required.
82
What is often required for large ranches in terms of legal description?
A legal description often requires an addendum to fully describe the property, ensuring all details are included.
83
What should not be used for condominiums instead of the One to Four Family Residential Contract (Resale)?
The Residential Condominium Contract (Resale) is the appropriate form for these transactions.
84
What is a bilateral contract?
A bilateral contract is an agreement between two parties where both agree to perform certain actions, the most common type of contract in real estate transactions.
85
What is a void contract?
A void contract has the same enforcement weight as a non-existing contract. It is not legally enforceable and has no binding effect on the parties involved.
86
What does the Statute of Limitations specify?
It specifies the length of time a person has to bring a civil lawsuit; if the time period expires, the claim is no longer valid.
87
What does the four corners doctrine direct a judge to do?
It directs a judge to interpret a disputed contract based on the document as a whole, without considering external evidence unless absolutely necessary.
88
Why is the property's address listed at the top of each contract page?
To ensure that the pages of the contract are not mixed up with those of another transaction.
89
What should Pam ask the seller regarding the ceiling fan?
Pam should ask if the seller wants to keep the ceiling fan; if so, it should be removed before showings to avoid confusion or disputes.
90
Where are penalty funds collected from frequent transfer fee violators deposited?
They are deposited in the general revenue fund of the state to ensure the funds are used for public benefit.
91
What creates the most legal risk for real estate agents in the TREC promulgated Residential Contract?
The Special Provisions paragraph creates the most legal risk, and agents must avoid practicing law by writing inappropriate or unauthorized provisions.
92
How is the sale price established?
The sale price is established by adding the down payment to the sum of all loans, ensuring clarity in the total amount the buyer is paying.
93
What is the Seller’s Disclosure Notice (SDN)?
It is a statement of the items and systems a property has and whether those work properly or not, completed solely by the seller to ensure accuracy.
94
What is the purpose of the Special Provisions paragraph in the TREC promulgated One to Four Family Residential Contract (Resale)?
It is used to include items that have no other paragraph addressing them, allowing for additional factual statements or business details desired by the parties.
95
What can happen if a corporation violates the Anti-Trust Act?
Each infraction can result in a fine of up to $100,000,000, with a maximum total fine of $300,000,000 for three infractions.
96
What is one of the biggest areas of dispute when buying a residence?
Repairs are a major area of dispute, as buyers and sellers often disagree on what repairs should be made and who should pay for them.
97
What is the TREC Unimproved Property Contract used for?
It is used for transactions involving the sale of vacant land with no existing structures.
98
What items are included in the Farm and Ranch Accessories paragraph of the TREC-promulgated Farm and Ranch contract?
Items like hunting blinds, troughs, and fuel tanks are included, while a house is considered real property, not an accessory.
99
What are the two types of consideration in contracts?
Valuable consideration refers to something of monetary value, while Good consideration refers to something like love and affection, which does not have monetary value.
100
When may a survey not be required?
A survey may not be required if there is no lender involved in the transaction, as lenders often require surveys for financing purposes.
101
What is the legal age in Texas?
A person must be 18 years old to be of legal age unless they are married or in the military.
102
What does the Representations paragraph in the TREC New Home Contract (Completed Construction) address?
It addresses the seller's ability to accept backup offers.
103
What must a real estate agent do to protect her commission?
She must register her client with the builder before showing the model home, as builders often require this step.
104
What should a buyer do when purchasing a condominium?
A buyer should carefully read over the associations’ bylaws and rules, which outline restrictions, fees, and other regulations.
105
What does the Addendum for Release of Liability on Assumption of FHA, VA, or Conventional Loan Restoration of Seller’s Entitlement for VA Guaranteed Loan indicate?
It is listed in the Agreement of the Parties paragraph on the TREC Residential Condominium Contract (Resale) but does not appear in the same paragraph on the One to Four Family Residential Contract (Resale).
106
What is the TREC Third Party Financing Addendum used for?
It is used when a buyer is applying for a loan with conventional, FHA, VA, or other forms of financing, outlining the terms and conditions.
107
What is the basic issue with the transfer fee concept?
When there is a fee, there should be a product or service provided in exchange; transfer fees often lack a clear justification.
108
What is the purpose of the Amendment to Contract form?
It is used to make changes to a contract that has already been agreed to, requiring both parties to agree for the amendment to be valid.
109
What does the TREC Subdivision Information form request?
It requests specific financial and legal details, such as special assessments, capital expenditures, and unsatisfied judgments.
110
What does a Property Owner’s Association (POA) do?
It enforces deed restrictions to maintain the value of homes and subdivisions, ensuring a consistent standard of property maintenance.
111
What does the TREC Subdivision Information, Including Resale Certificate ensure?
It ensures the buyer has all necessary details about the property and association, such as fees, rules, and financial status before closing.
112
What information might a broker provide to a Residential Service Company (RSC)?
The brand and serial number of the air conditioning compressor is an example of information often required for proper coverage.
113
Do amendments replace the original contract?
No, amendments modify specific terms of the original agreement while keeping the rest of the contract intact.
114
What is the Short Sale Addendum used for?
It is used in transactions where the seller owes more on the property than its current market value, contingent upon the lender's approval.
115
What does the TREC Loan Assumption Addendum state about seller response?
If the seller does not respond to the buyer within 7 days, it is assumed that the seller has given approval.
116
What is the TREC Seller Financing Addendum used for?
It is used when the seller agrees to carry the note for all or part of the sales price, outlining the terms of the financing agreement.
117
What does paragraph 5 of the TREC Notice of Buyer's Termination of Contract allow?
It allows termination due to the seller's failure to disclose material facts.
118
What do property management agreements provided by the Texas Realtors® Association include?
They include terms and conditions for managing a property, designed to comply with state regulations.
119
What happens if the buyer fails to provide financial information by the specified deadline in the TREC Seller Financing Addendum?
The seller has 7 days to terminate the agreement.
120
What does the 'time is of the essence' clause in the TREC Addendum for Sale of Other Property by Buyer require?
It requires strict adherence to deadlines, ensuring that all parties meet their obligations within specified timeframes.
121
What is the effective date of a back-up contract according to the TREC Addendum for 'Back-Up' Contract?
It is the date the buyer is notified that the first contract has terminated.
122
How should the rental rate for a TREC Seller's Temporary Residential Lease be calculated?
It should be calculated on a daily basis to ensure accurate prorating for the duration of the lease.
123
What happens if a buyer terminates a TREC Buyer's Temporary Residential Lease prior to the closing date?
The security deposit is refunded to the buyer, less any itemized deductions for damages or unpaid rent.
124
What is the Addendum for Sale of Other Property by Buyer used for?
It is used when a buyer needs to sell their current home before purchasing another property, outlining the terms of the contingency.
125
What does an option to purchase contract give the buyer?
It gives the buyer the right, but not the obligation, to complete the purchase, making it unilateral until the buyer decides to exercise the option.
126
What does it mean when mineral rights are 'reserved'?
It means that a previous owner retained ownership of the rights, and they are not included in the property sale.
127
What does the TREC Addendum for Property Located Seaward Of The Gulf Intracoastal Waterway inform buyers about?
It informs buyers of the possibility that erosion can cause a structure to eventually end up on a public beach, leading to legal and financial complications.
128
Are transfers from an investor in real property exempt from providing a Seller’s Disclosure Notice?
No, they are not exempt; exemptions typically apply to transfers like those between spouses or through foreclosure.
129
What does the TREC Addendum for Property Located Seaward of the Gulf Intracoastal Waterway warn buyers about?
It warns buyers of potential risks, such as erosion, that can affect coastal properties.
130
What does a lender typically require in a financed transaction?
A title policy to protect their interest in the property against title defects or claims.
131
What should the TREC Seller's Disclosure Notice be uploaded to?
It should be uploaded to the MLS for open distribution, if possible, to ensure transparency for potential buyers.
132
What are Ground Fault Circuit Interrupters (GFCIs)?
They are electric plugs near a water source designed to help prevent electric shock by shutting off power when a fault is detected.
133
Who is responsible for completing the TREC Seller's Disclosure Notice?
The seller is responsible for providing accurate information about the property’s condition to potential buyers.
134
Is the TREC Texas Real Estate Consumer Notice Concerning Hazards or Deficiencies required in any transaction?
No, it is an optional form that provides information about potential hazards or deficiencies.
135
When must a real estate agent provide the Information About Brokerage Services form?
Upon the first substantial discussion about real estate to ensure the customer understands the agent’s role.
136
What is the primary purpose of the Texas Real Estate Commission (TREC)?
To protect the public by ensuring that real estate professionals adhere to ethical and legal standards.
137
What are the main elements of fraud?
They include intent, reliance, and damage, with reliance occurring when the deceived party depends on false information.
138
When is the Sherman Anti-Trust Act violated?
When two brokers agree to divide a city into exclusive territories, constituting market allocation.
139
What is an example of personal property?
A dining table is an example because it is movable and not permanently attached to the land or structure.
140
What does TREC provide to notify buyers about title ownership?
A form to obtain an abstract or a title policy, ensuring buyers are informed about verifying title ownership.
141
What must be in writing to sue for a commission?
The listing agreement must be in writing to ensure clarity and enforceability.
142
What happens when one party receives the earnest money as liquidated damages?
The contract is terminated as a remedy agreed upon in the contract to resolve the default.
143
What is a court's primary objective when interpreting a contract?
To ascertain and give effect to the intent of the parties, ensuring the contract is enforced as intended.
144
What is the main purpose of TREC?
To protect the public by regulating the real estate industry and ensuring that licensees adhere to ethical and legal standards.
145
What does a void contract mean?
It means there is an 'absence of' a contract, making it not legally enforceable.
146
What does the Texas Real Estate Commission (TREC) administer?
It administers regulations and standards for the real estate industry.
147
What is the court's primary objective when interpreting a contract?
To ascertain and give effect to the intent of the parties.
148
What is TREC's main purpose?
To protect the public by regulating the real estate industry and ensuring that licensees adhere to ethical and legal standards.
149
What does a void contract mean?
It means there is an 'absence of' a contract and is not legally enforceable.
150
What does the Texas Real Estate Commission (TREC) administer?
The Texas Real Estate License Act, ensuring compliance with state laws and regulations governing real estate practices.
151
What is required to make a valid contract?
Competent parties, legal objective, consideration, and agreement.
152
What does mutual assent mean?
An agreement to all the terms by all the parties of a contract.
153
What happens if fraud occurs in a contract?
The contract becomes voidable, allowing the injured party to enforce or rescind it.
154
What is the primary purpose of the Real Estate License Act (RELA)?
To establish ethical standards and regulate the licensing and conduct of real estate professionals in Texas.
155
What is the role of the Broker-Lawyer Committee?
To draft and revise real estate contract forms to ensure compliance with Texas laws.
156
What does TREC do regarding contracts for real estate agents?
Promulgates contracts to ensure standardization and compliance with state laws.
157
When are real estate agents required to use TREC promulgated forms?
Unless the form is prepared by an attorney for that specific transaction or required by the property owner.
158
What is price fixing in real estate?
When two or more brokers conspire to charge the same commission rate, violating the Sherman Anti-Trust Act.
159
What constitutes a counteroffer?
If a seller changes one term of an offer and then signs it.
160
When does an offer become a contract?
When all parties have signed and/or initialed the contracts and both parties have been notified.
161
What can happen if an owner does not pay Home Owner's Association dues?
The Association could file a lien against the property, potentially leading to foreclosure.
162
What are liquidated damages?
Damages agreed to in advance by the parties in a contract.
163
What is essential for a successful listing presentation?
Having a strong strategy that includes understanding the seller’s needs and market conditions.
164
What does the Texas Department of Insurance regulate?
Insurance companies and title insurers in Texas.
165
Is earnest money required to make a valid contract?
No, a valid contract requires agreement, competent parties, legal objective, and consideration, but not necessarily earnest money.
166
What is an endorsement in an insurance policy?
A clause that specifies an exemption from or a change in coverage.
167
What is the goal of a property survey?
To identify property boundaries and features for legal and development purposes.
168
What is the license holder responsible for according to TREC?
Advising the buyer, in writing, to have an abstract examined by an attorney or to obtain a title policy.
169
What is required for homes built before 1978 regarding lead-based paint?
A lead-based paint disclosure to inform buyers of potential hazards.
170
What is a Residential Service Contract?
A type of warranty that covers certain home systems and appliances for the first year after purchase.
171
What must be provided to buyers for homes built prior to 1978?
An EPA-approved pamphlet titled 'Protect Your Family from Lead in Your Home'.
172
What is the maximum lease term for TREC promulgated Seller's Temporary Lease?
90 days.
173
In the TREC promulgated Seller's Temporary Lease, who becomes the Tenant?
The seller, as they are leasing the property back from the buyer.
174
What does a condo owner own?
The air space within their unit and shared ownership of common areas.
175
What is the Condo Resale Certificate?
Issued by the condo association, it provides important information about HOA rules, fees, and financial status.
176
What is an example of a surface lease?
A hunting lease, granting rights to use the surface of the land.
177
What are rollback taxes?
Assessed when a property’s use changes from agricultural to residential, resulting in the loss of agricultural tax exemptions.
178
What does a Property Report contain?
Important information about the lots and subdivision, required to be provided to the buyer before signing the purchase contract.
179
When was the Civil Rights Act first adopted?
In 1866 to ensure equal rights for all citizens.
180
What must sex offenders disclose under Texas law?
Their date of birth and hair and eye color.
181
What does FIRPTA require from non-U.S. citizens buying property in the U.S.?
To declare their non-citizen status for tax purposes.
182
What does the One to Four Family Residential Contract (Resale) include?
A notice stating it is not for use for condominium transactions.
183
What does the Seller’s Temporary Residential Lease include?
A notice stating it is for use only when the seller occupies the property for no more than 90 days after closing.
184
What is required for homes built before 1978 regarding lead hazards?
The pamphlet 'Protect Your Family from Lead in Your Home'.
185
What happens to earnest money funds at settlement?
They are typically applied to the buyer’s closing costs.
