Buyer’s Agent Beware
[Editor’s Note: The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway, or any other entity referenced.]
Thanks to heightened concerns about the security of online data, Minnesota Realtors are no longer supposed to scan and email copies of Buyers’ earnest money checks when they send offers to Sellers (electronic delivery being the overwhelming practice these days).
The worry?
The old way, the scanned-in check would reside in the iPad, cellphone, or laptop of the Buyer’s agent, where it could potentially end up in the wrong hands.
(Note: while Edina Realty’s proprietary software, called ProKit, is highly secure, that’s not true for all Brokers. It’s also the case that agents carry lots of data around on portable devices that can be lost or stolen — or just left unattended.)
Solution: a New Form (Naturally)
The solution to the above?
Something called “The Earnest Money Receipt Form.”
Contrary to appearances, it does NOT signify that the listing agent (representing the Seller) has received the Buyer’s earnest money check.
Rather, it represents that the Buyer’s agent has received the check — and will deliver it within 48 hours if/when the deal is consummated.
Of course, a Buyer’s agent who completes and sends that form really needs to have possession of the check.
Apparently, there has been at least one recent deal in town where that wasn’t the case.
When the promised earnest money check never arrived and the deal went south, the Seller made their displeasure known through legal action (though you’d certainly guess that an AWOL Buyer’s earnest money check was hardly the only problem).
P.S.: Unlike other forms that make up a standard Purchase Agreement, clients don’t need to sign (and typically never see) “The Earnest Money Receipt Form” — it’s strictly between the agents (and their brokers).
