After a seller backs out of a contract, what must happen before the broker can disburse earnest money back to the buyer?

In this scenario, the critical part revolves around the appropriate action that the broker must take regarding the disbursement of the earnest money after a seller has backed out of a contract. The correct answer states that if neither party sends a protest within 30 days, the broker is then authorized to disburse the funds to the buyer as specified in her letter.

This aligns with typical real estate practices and laws that protect the interests of both parties during a transaction. A time frame of 30 days is provided to allow either party the opportunity to contest the disbursement of funds, ensuring due process and fairness. If no protest is filed within this timeframe, it implies that both parties are in agreement, or at least are not taking further action to dispute the outcome, allowing the broker to proceed with the disbursement efficiently.

The mention of the broker acting in accordance with her letter adds a layer of procedural transparency; it shows that there are documented instructions guiding the disbursement process, reinforcing the broker's accountability in handling the earnest money. This ensures that the process remains fair and organized, thus protecting the rights of all parties involved.

Understanding this process is crucial for real estate professionals, as it underlines the importance of adhering to legal timelines and documentation