10. A listing licensee received an earnest money check with an offer on a seller's property. One of the two owners of the property accepted the offer in writing. The second owner was out of town, but orally agreed to the contract. The earnest money check must be deposited into the escrow account by the next business day after the
Answer: B
The earnest money check must be deposited into the escrow account by the next business day after the second owner signs the contract.
The earnest money check must be deposited into the escrow account after the second owner signs the contract, as both owners need to provide written consent for the agreement to be binding.
A) listing licensee received the offer
This option is incorrect because the timing of the earnest money deposit is related to the acceptance of the contract by both owners, rather than when the listing licensee received the offer. The deposit is not required until all necessary parties have agreed to the terms.
B) second owner signs the contract
This option is correct because the contract must be fully executed, which requires the signature of both owners. The earnest money check should be deposited into the escrow account by the next business day following the second owner's signature, ensuring that all parties have officially agreed to the terms.
C) first owner signed the contract
This option is incorrect as it only considers the first owner's signature. The contract is not fully binding until the second owner also signs, making it essential for their signature to trigger the requirement for the earnest money deposit.
D) oral acceptance of the second owner
This option is incorrect because an oral agreement does not suffice in a real estate transaction, which requires written acceptance from both owners. The earnest money deposit is contingent upon the formal signing of the contract by the second owner.
Conclusion
The correct answer is B, as the deposit of the earnest money check is contingent upon the second owner's signing of the contract, which formalizes the agreement between all parties. Other options fail to recognize the necessity of both owners' written consent for the contract to be binding, thereby invalidating the timing of the earnest money deposit based on those scenarios.