Can I require the other side to reimburse me for repairs as they happen instead of waiting until the final closing? – North Carolina

Short Answer

Usually not by “requirement” unless the purchase contract (or a written amendment) says reimbursement will be paid during the pre-closing period. In most North Carolina closings, repair costs are handled either by (1) the responsible party completing the repairs before closing, or (2) a negotiated credit or escrow/holdback that is settled at closing. If reimbursement is needed as repairs happen, the practical solution is a written agreement that clearly authorizes interim payments and explains how they will be documented and funded.

Understanding the Problem

In a North Carolina home sale, can one party make the other party pay back repair costs in real time while the transaction is still pending, rather than handling the repair money at the final closing? The issue usually comes up when one side is arranging repairs to keep the deal on track, but wants cash flow protection and a clear paper trail before the deed and closing funds are exchanged. The decision point is whether the contract terms (or a signed change to those terms) create a duty to reimburse before closing, and whether the closing process can safely administer that kind of mid-stream payment.

Apply the Law

In North Carolina, the starting point is contract: the purchase contract controls who must repair, when repairs must be completed, and how (or whether) money changes hands for those repairs before closing. If the contract is silent, one side generally cannot force the other side to pay repair invoices “as they happen.” Instead, the parties typically negotiate a written amendment that uses a credit at closing or an escrow/holdback arrangement administered through the closing attorney’s trust account, with clear conditions for release.

Even when the parties agree on an escrow/holdback, the closing attorney’s role is to disburse funds according to written instructions tied to the closing and the settlement statement. Many closing workflows are designed to reconcile everything at closing, not to run an ongoing reimbursement program during the weeks leading up to closing. That is why interim reimbursement usually requires a very clear written agreement and coordination with the closing attorney and lender (if there is one).

Key Requirements

Written agreement: A signed contract term or amendment must spell out interim reimbursement (who pays, what qualifies as a “repair,” and when payment is due).
Clear documentation: The agreement should require invoices, proof of payment, and (when relevant) permits and lien waivers so the property does not pick up contractor liens before closing.
Defined funding and release conditions: The agreement must state where the money comes from (seller funds, buyer funds, escrow/holdback) and the exact trigger for each payment (inspection sign-off, contractor completion, receipts, re-inspection, etc.).

What the Statutes Say

N.C. Gen. Stat. § 47E-4 (Residential property disclosure statement) – Requires a seller disclosure statement in many residential transfers; it is separate from (and does not replace) negotiated repair terms in the contract.

Analysis

Apply the Rule to the Facts: Here, repairs are being performed in connection with an upcoming North Carolina closing, and reimbursement is desired as costs occur. Without a written contract term (or signed amendment) that requires interim payments, the other side typically can insist that repair money be handled at closing as a credit, price adjustment, or escrow/holdback. If interim reimbursement is important, the practical path is negotiating a written amendment that defines eligible repairs, documentation, and a payment schedule that the closing attorney and lender can administer.

Process & Timing

Who proposes it: The party paying for repairs. Where: Through the real estate agents (if any) and the closing attorney handling the North Carolina closing. What: A written contract amendment or escrow/holdback agreement with detailed disbursement instructions. When: Before authorizing non-emergency repairs, and well before the scheduled closing date so the lender (if any) and closing attorney can approve the process.
Document the work: Collect contractor invoices, proof of payment, photos, permits (if required), and lien waivers. If the agreement requires re-inspection, schedule it promptly after each repair item is completed.
Disbursement method: If the parties agree to pay during the pre-closing period, the agreement should state whether payments come directly from the other party (outside closing) or from an escrow/holdback administered by the closing attorney, and what proof is required before each release.

Exceptions & Pitfalls

Lender restrictions: If there is a mortgage loan, the lender may limit credits, require repairs to be completed before funding, or refuse a structure that looks like ongoing pre-closing disbursements.
Mechanic’s lien risk: Paying a contractor without collecting lien waivers (or paying the wrong party) can leave a lien risk that complicates title and closing.
Vague repair scope: “Reimburse repairs as they happen” is often too vague. Disputes usually arise over what counts as a repair versus an upgrade, whether work was necessary, and whether the cost was reasonable.
Out-of-closing payments: Side payments made outside the closing process can create confusion about what must appear on the settlement paperwork and can trigger last-minute objections from the lender or closing attorney.

Conclusion

In North Carolina, interim reimbursement for repair costs usually cannot be forced unless the purchase contract (or a signed amendment) clearly requires it. Most transactions handle repair money at closing through a credit, price adjustment, or an escrow/holdback with written release conditions. The most important next step is to put the reimbursement plan in writing and coordinate it with the closing attorney before the scheduled closing date so documentation, lien protection, and disbursement rules are clear.

Talk to a Real Estate Attorney

If repairs are happening before a North Carolina closing and reimbursement timing is becoming a dispute, our firm has experienced attorneys who can help clarify contract options, draft a workable written amendment, and coordinate with the closing process. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.