Which statement regarding earnest money is true?

The statement that the earnest money should be maintained in a trust account until closing is true. This practice is crucial because earnest money serves as a demonstration of the buyer's commitment to the purchase of a property. Keeping the funds in a trust account ensures that they are secure and properly accounted for, protecting both the buyer's interests and the seller's rights in the transaction.

In Pennsylvania and many other jurisdictions, real estate agents are required to deposit earnest money into a trust or escrow account promptly. This protects the buyer's investment until the closing of the sale, at which point the money is applied toward the purchase price or used in accordance with the terms of the contract.

Maintaining escrow funds in a trust account until closing fosters trust between all parties involved in the transaction, ensuring that the money is not misappropriated or spent inappropriately before the deal is finalized.