Michigan Real Estate Salesperson Practice Exam

The correct choice, which is earnest money, is specifically designed to show a buyer's serious intent to purchase a property. When a buyer submits an offer on a property, they typically include earnest money as part of that offer. This deposit is then held in trust until the transaction is completed, at which point it can be applied to the purchase price or returned to the buyer if the sale does not proceed, depending on the terms of the agreement. With the seller's approval, a broker may take earnest money as a deposit to assure the seller of the buyer's commitment.

The other options do not fit this context. Acceleration payment refers to a clause in a mortgage or loan agreement that allows the lender to demand full repayment under certain conditions, which is not a type of deposit. A security deposit is unrelated to real estate transactions for home purchases, as it typically pertains to rental agreements, where it is held by a landlord as collateral against potential damages beyond normal wear and tear. A commission advance refers to a pre-payment of commission due to a broker, not a deposit tied to the property transaction itself. Therefore, only earnest money serves the purpose of being a deposit with seller approval in real estate transactions.