When can escrow funds be withdrawn by a sponsoring broker?

The correct answer is that escrow funds can be withdrawn by a sponsoring broker once a transaction is closed and complete. This principle is rooted in the legal and ethical obligations surrounding the management of escrow funds. Escrow accounts are designed to hold funds securely until specific conditions are met, typically tied to the completion of a real estate transaction.

In this context, "closed and complete" means that all aspects of the transaction have been finalized, including the fulfillment of all contractual obligations by both parties. At this point, the sponsoring broker is authorized to distribute the funds in accordance with the terms agreed upon within the sales contract or lease agreement. This ensures that the funds are only released when it is appropriate to do so, protecting both the buyer's and seller's interests.

This approach also reinforces trust in real estate transactions, as it ensures that the funds are only moved when all parties have met their commitments, thus minimizing the potential for disputes or misunderstandings.