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
A. release the earnest money to the seller immediately.
B. notify the buyer of the broker's intention to release the earnest money to the seller.
C. release the earnest money on the buyer's verbal approval.
D. refuse to release the earnest money. Correct
Rationale: Releasing earnest money before the property inspection contradicts the terms of the purchase and sales agreement, which stipulates that the funds are to be held until after the inspection.
Option A is incorrect as it disregards the agreement's conditions. Option B, while notifying the buyer, still implies an action that violates the agreement by intending to release funds prematurely. Option C relies on verbal approval, which is insufficient for such a significant transaction and does not align with the agreement’s stipulations. Therefore, refusing to release the earnest money is the only appropriate action to uphold the contract's terms.
