Buying a house is a major purchase. To do it right, you'll want to determine what you can afford, which neighborhood will best suit you, and what features you need in a house, condo, or other type of home. But you'll also want to be aware of the legal issues inevitably involved, such as required disclosures by sellers, terms of your purchase contract, and potential title defects.
With proper preparation, careful choice of a real estate agent, and prudent use of other qualified professionals, buying a home in North Carolina can be a positive experience.
Some of the benefits of using a real estate agent to help you find and buy a North Carolina home include the agent's:
Your agent should guide you every step of the way, from drafting your written offer and negotiating with the seller on price and other key terms to coordinating the escrow process and house closing.
Luckily, working with a real estate agent won’t cost you anything. The seller usually pays the entire real estate commission (typically 5% to 6% of the house sale price, split between the seller’s agent and yours).
Personal referrals from other home buyers are usually the best way to select a real estate agent. You can find licensed North Carolina real estate agents at the North Carolina Real Estate Commission’s Licensee Info Search. Other useful resources include Zillow and Trulia, which offer customer reviews of real estate agents.
Be sure the agent you choose has plenty of experience and an excellent reputation and references.
State law in North Carolina (North Carolina General Statutes Section 47E-4) requires sellers to give prospective buyers a disclosure form. Its purpose is to provides details about the property and alert buyers to any known problems, for instance covering:
Disclosures must be made on a Residential Property and Owners' Association Disclosure Statement form established by the North Carolina Real Estate Commission.
Sellers need not tell you everything on this form. For starters, they're expected to disclose only what they know about (which may not be much). They can also opt to simply say "no representation" about an issue.
Also, certain types of sales (such as newly built, never inhabited, homes) are exempt from state disclosure rules.
In addition to state-required disclosures, sellers of houses built before 1978 must comply with federal Title X disclosures regarding lead-based paint and hazards. See the lead disclosure section of the EPA’s website for details.
Buyers should not rely solely on the seller's disclosures, particularly if the seller frequently opted for the "no representation" option on the form.
Instead, hire an independent home inspector to produce a report on the house's physical condition. Many buyers make their offer contingent upon a satisfactory inspection report, to be sure that no material defects exist and to identify:
After you receive the report, you can either negotiate with the seller over repair needs (almost every house has some) or cancel the sale altogether, if you're within the "due diligence" period discussed below.
A purchase agreement is a legal document containing the terms and conditions of your real estate transaction. It must be in writing and signed by the parties (buyers and sellers) and include an offer to sell or purchase, an acceptance of the offer, the sale price, and an adequate description of the property.
The form will include many blanks for you to fill in, concerning things like internal deadlines for you to complete your "due diligence." This includes things like obtaining a property inspection and a mortgage loan (for which you'll also need a home appraisal), checking out insurance rates, and reviewing any governing documents if the property is located within a development governed by a homeowners' association.
See the North Carolina Association of Realtors Offer to Purchase and Contract for a sample.
A buyer should always obtain a title search from a title company before purchasing a home. The title company searches public records and other sources for any liens, easements (such as the utility company’s right to access part of the property), or other encumbrances or title restrictions that may affect the property. If the title search locates problems, the buyer should require the seller to correct these as a condition to closing.
Also consider purchasing a title insurance policy to protect your title to the property against adverse claims by third parties, or any clouds on the title missed by the title search. Mortgage companies usually require buyers to purchase a title insurance policy in connection with obtaining a home loan.
Unlike in many states, North Carolina law requires sellers to involve a lawyer in the house closing and other aspects of the real estate transaction. (For details, see the North Carolina State Bar ethics opinions that set that out and describe what non-attorneys may do in the real estate transaction process: Authorized Practice Advisory Opinion 2002-1 and 2002 Formal Ethics Opinion 9.)
Find an experienced real estate attorney in North Carolina.
The North Carolina Bar Association publishes a free brochure on buying a home in North Carolina.
