Florida Real Estate Sales Associate Examination Content OutlineReal Estate Brokerage Activities and ProceduresMedium
A Florida real estate broker receives an earnest money deposit in the form of a post-dated check. What is the broker's immediate responsibility regarding this check?
- AImmediately notify the Florida Real Estate Commission (FREC) of the post-dated check.
- BDeposit the check into the escrow account within three business days of receipt.
- CReturn the check to the buyer and request a current form of payment.
- DHold the check in a secure place until its effective date and then deposit it promptly.
Show answer & explanationAnswer & explanation
Correct answer: D. Hold the check in a secure place until its effective date and then deposit it promptly.
A post-dated check is considered a promissory note and cannot be deposited until its effective date. The broker must secure it, inform the seller of its nature, and deposit it on the date specified on the check.
Why the other options are wrong
- A. Notifying FREC is not an immediate requirement for receiving a post-dated check, provided it's handled correctly and the seller is informed.
- B. Depositing a post-dated check before its effective date is prohibited and could lead to issues like NSF (non-sufficient funds).
- C. While requesting a current payment is an option, the broker is not required to return it if the seller accepts the post-dated check and proper handling procedures are followed.
Post-Dated Earnest Money Check
When a broker receives a post-dated earnest money check, they must secure it, inform the seller of its nature, and deposit it on its effective date, not before.
- Considered a promissory note until its effective date.
- Broker must obtain seller's acceptance.
- Must be held securely until the date on the check.
- Deposited promptly on the effective date.
Memory trick: Date not yet, keep it safe, then deposit, don't wait.