What action must a broker take if a transaction does not close?

In the context of a real estate transaction that does not close, the broker's actions regarding the handling of funds are guided by the terms outlined in the contractual agreement between the parties involved. It is essential for a broker to adhere to these terms to ensure compliance with legal and ethical standards.

When a transaction fails to complete, the broker must return the funds according to the guidelines laid out in the contract. This typically involves determining who is entitled to the escrow funds based on the reasons for the non-closing event. The contractual agreement typically includes specific instructions for how funds should be disbursed in various circumstances, such as whether the buyer or seller is entitled to the escrow deposit depending on the situation leading to the failure to close.

By following the direction expressed in the contractual agreement, the broker ensures that they are acting in accordance with the legal obligations and protecting the interests of their clients. This method provides clarity and minimizes the potential for disputes among the parties involved in the transaction.