I am putting a contract on a home in South Carolina and would like clarity on a portion of the contract - can you explain?
The clause states:
27. TRUST ACCOUNT INTEREST/CHARITABLE CONTRIBUTION: According to the rules and regulations of the South Carolina Real Estate Commission and the Code of Laws of South Carolina, 1976, as amended, any interest earned on Buyer’s earnest money deposit would belong to Buyer until the closing of the transaction referenced in this agreement. It is understood that Broker may place deposited earnest monies into an interest bearing trust account and that Broker will retain all interest incurred in said account in which case all interest earned on Broker’s interest bearing trust account shall be donated on a regular basis to a charity of Broker’s choice.
If I decide not to contribute to the charitable account do I get the interest money earned back at closing? If not, what happens to this money if it is not contributed to the broker's agency charitable fund?
Thanks,
Stacey
Hello and Congrats on the contract!
Not all South Carolina Purchase and Sales contracts include that item. As Mr. Joe Idleman put it (extremely well I might add....thumbs up to you) in his answer, they should be able to put it into a non-interested bearing account but you nor the Broker would be able to keep this amount if it WAS in the interest bearing account.
Darin
Investor
The purpose of this clause is to allow the broker to place the earnest money in an interst bearing account. By law the interest cannot be kept by the broker nor issued to the buyer. That is why it is donated to a
non-profit charitable organiziation. It the buyer elects to select no in this clause in most instances the broker will deposit it in a non-interest bearing account. I hope this helps you. Check out my blog at http://www.CarolinaJoe.com/blog for additional real estate articles.
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