Manufactured Housing Practice Test

What is required for escrow instructions to be considered valid in a sale?

1. Must be signed by both the buyer and dealer

2. Must close on the date specified unless amended

3. Must include retention of the original document by the escrow agent

4. All the above are correct

The correct answer is: All the above are correct

For escrow instructions to be valid in a sale, they must encompass several key elements that ensure the process is legally binding and adequately protects all parties involved. The necessity for the instructions to be signed by both the buyer and dealer establishes mutual consent, which is fundamental in any contractual agreement. This consent signifies that both parties understand and agree to the terms outlined in the escrow instructions. Additionally, stipulating that the transaction must close on the date specified (unless amended) provides clarity and sets a clear timeline for the completion of the sale. This time-bound requirement helps in organizing and managing expectations for both the buyer and the dealer. Lastly, the retention of the original document by the escrow agent is significant as it ensures that the terms and conditions laid out in the escrow instructions are preserved. This retention serves as a reference point should any disputes arise or should questions about the agreement need to be addressed in the future. Each of these elements is crucial for securing the authenticity and enforceability of the escrow instructions, thereby making all are necessary for the instructions to be deemed valid in a sale.