Contracts and Promulgated Forms Practice Question

Question

A transaction coordinator flags a compliance question in a Texas real estate transaction involving earnest money. What should the licensee understand? (Item 150)

Answer choices

1. A. The salesperson may handle the matter independently without broker involvement when compensation is expected.
2. B. Identify deposit delivery, escrow handling, and default implications.
3. C. Local custom controls even when a statute, regulation, contract, or disclosure rule applies.
4. D. The requirement matters only if the buyer uses lender financing.

Correct Answer

B. Identify deposit delivery, escrow handling, and default implications.

Explanation

The correct answer is B because earnest money requires candidates to identify deposit delivery, escrow handling, and default implications. The other options rely on unsafe assumptions about custom, oral agreement, escrow, client preference, or independent salesperson authority and do not reflect sound Texas exam practice.

Question details

• Difficulty: medium
• Domain: Contracts and Promulgated Forms
• Objective: earnest money

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