Tennessee Real Estate License Exam Practice Question
The purchase and sales agreement provides for release of earnest money to the seller after the buyer's property inspection. The seller requests the earnest money prior to the property inspection. The broker should
Correct Answer: D
Rationale: Releasing earnest money prior to the buyer's property inspection contradicts the terms of the purchase and sales agreement, which stipulates that the seller receives the funds only after the inspection. Option A is incorrect as it violates this agreement. Option B, while notifying the buyer, still implies an action that is not compliant with the contract, making it inappropriate. Option C relies on verbal approval, which is insufficient for such a significant transaction. Thus, refusing to release the earnest money ensures adherence to the contractual obligations and protects the buyer's interests.
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