Which option is not an acceptable form of earnest money deposit?

The reason why the choice of credit is considered not an acceptable form of earnest money deposit relates to the traditional practices in real estate transactions. An earnest money deposit is typically intended to show the buyer's good faith and commitment to purchase a property. Acceptable forms of earnest money, such as cash, debit, and checks, provide immediate and verifiable funds that can be readily accepted and processed by the seller or the title company.

Credit, on the other hand, involves borrowing funds or deferring payment, which does not align with the purpose of the earnest money deposit. Since earnest money is meant to demonstrate financial commitment without suggesting future liability or dependence on credit terms, using a credit card is not seen as a secure or reliable way to convey this assurance. This practice ensures the seller can count on the earnest money deposit being readily available, while credit transactions could introduce uncertainty in payment validity or timing.