Florida Real Estate Broker ExaminationReal Estate Brokerage ManagementMedium
A Florida real estate broker receives an offer on a property listed for $300,000. The offer is for $290,000, and the buyer provides an earnest money deposit of $5,000 in the form of a post-dated check, dated 5 days from the offer date. What is the broker's immediate obligation upon receiving this offer?
- ADeposit the check into the escrow account within three business days, regardless of the post-date.
- BHold the post-dated check until its date, then deposit it into the escrow account.
- CReject the offer because a post-dated check is not a valid form of earnest money.
- DImmediately disclose the post-dated nature of the check to the seller and present the offer.
Show answer & explanationAnswer & explanation
Correct answer: D. Immediately disclose the post-dated nature of the check to the seller and present the offer.
A post-dated check can be accepted as an earnest money deposit, but its nature must be immediately disclosed to the seller. The broker's primary duty is to present all offers and material facts to the principal.
Why the other options are wrong
- A. The check cannot be deposited until its date; however, the offer and its terms must be presented immediately.
- B. Holding the check without disclosure is a breach of duty; the seller needs to know about the post-date.
- C. A post-dated check is a valid form of earnest money if the seller is informed and accepts it.
Post-dated Earnest Money
A post-dated check can serve as an earnest money deposit, but the broker must immediately disclose its post-dated nature to the seller upon receipt.
- Acceptable form of deposit.
- Immediate disclosure to seller is mandatory.
- Deposit only on the date of the check.
Memory trick: Don't delay, just disclose, then deposit on the date.