How should I review a new purchase contract from a new buyer before I agree to it? – North Carolina

Short Answer

In North Carolina, a seller reviewing a new purchase contract should focus on the price, due diligence fee, earnest money, deadlines (especially the due diligence period and closing date), buyer contingencies, and default and repair terms before signing. The contract becomes binding once both sides sign, so any needed changes should be negotiated and written into the contract first. State law also requires giving required property disclosure forms to the buyer by the time the buyer makes an offer, or the buyer may gain a right to cancel.

Understanding the Problem

The core question is: how should a North Carolina property owner go about reviewing a new buyer’s proposed purchase contract before agreeing to it? This comes up when a seller receives an offer on a house or small residential property and wants to know what to look for beyond the purchase price. The concern is usually whether the deadlines, fees, contingencies, and risk-shifting terms fairly protect the seller under North Carolina real estate law.

Apply the Law

Under North Carolina law, a residential purchase contract is a binding agreement that sets price, timing, contingencies, and remedies if either side fails to close. The main forum for disputes is the state courts, and deadlines in the contract (especially the due diligence period and closing date) are strictly enforced. State law also requires certain written disclosures to the buyer in most one-to-four family residential sales.

Key Requirements

Clear business terms: The contract should clearly state the purchase price, earnest money, due diligence fee, and how and when those amounts are paid and potentially refunded or forfeited.
Defined deadlines and contingencies: The contract must set the due diligence period, closing date, and any financing or other contingencies that allow the buyer to walk away, along with what happens to the money if that occurs.
Disclosures and risk allocation: The seller must handle required North Carolina disclosure forms, and the contract should address condition of the property, repairs, and remedies if either side defaults.

What the Statutes Say

N.C. Gen. Stat. § 47E-1 (Applicability of residential disclosures) – applies disclosure requirements to most residential transfers of one to four dwelling units.
N.C. Gen. Stat. § 47E-4 (Required disclosures) – requires a residential property disclosure statement (and, in many cases, an owners’ association and covenants disclosure) or a “no representation” election.
N.C. Gen. Stat. § 47E-5 (Time for disclosure; cancellation) – requires delivery of disclosures by the time the buyer makes an offer and gives the buyer a limited right to cancel if disclosures are late.
N.C. Gen. Stat. § 47-119.1 (Memorandum of contract to purchase) – allows recording a memorandum of a purchase contract to give public notice of the buyer’s contract rights.

Analysis

Apply the Rule to the Facts: With no specific facts given, consider a typical North Carolina residential sale where a buyer sends a standard form “Offer to Purchase and Contract.” A careful seller review would first confirm the total price and that the due diligence fee and earnest money amounts, and their refund rules, line up with the seller’s expectations. Next, the seller would compare the proposed due diligence period and closing date with availability to move and complete any agreed work. Finally, the seller would make sure the required disclosure forms are delivered on time and that repair, inspection, and default clauses do not create unexpected obligations or one-sided remedies.

Process & Timing

Who files: The parties do not “file” the purchase contract with a court; they sign it privately, often with help from real estate agents and a closing attorney. Where: The fully signed contract is usually kept by the parties, their brokers, and the closing attorney in North Carolina. What: A written purchase contract (often a standard North Carolina form) plus the required residential property disclosure and, if applicable, owners’ association and covenants disclosure. When: Disclosures must be delivered no later than the time the buyer makes an offer, and all negotiated changes must be written into the contract before both sides sign.
After signatures, the buyer delivers the due diligence fee (often directly to the seller) and earnest money (usually to a trust account), orders inspections, and works on financing during the due diligence period, while the seller cooperates with access and provides any agreed documents or repairs. Timeframes vary, but the due diligence period is often a few weeks, and many contracts set a closing within a couple of months.
By the closing date, the closing attorney typically completes title work, prepares the deed and settlement statement, and coordinates payoff of any liens. At closing, the seller signs the deed and other documents, receives net sale proceeds, and the deed is recorded in the county Register of Deeds, which completes the transfer.

Exceptions & Pitfalls

Some transfers, such as certain estate or foreclosure sales, may be exempt from specific disclosure requirements, which changes what must be delivered but not the need to review the contract terms carefully.
Common mistakes include assuming a verbal side agreement will control over written contract language, failing to understand that the due diligence fee is usually nonrefundable, and overlooking automatic extensions or special default remedies buried in the fine print.
Another frequent problem is not aligning inspection, repair, and loan approval timeframes with the due diligence deadline, which can leave a buyer canceling at the last minute or pressuring for concessions, and may delay or complicate closing for the seller.

Conclusion

To review a new buyer’s purchase contract in North Carolina, a seller should concentrate on the money terms (price, due diligence fee, earnest money), key dates (due diligence period and closing), contingencies, and default and repair provisions, while also complying with required state disclosure forms. The contract is the controlling document, so any needed changes must be negotiated and written into it before signing. A practical next step is to have a North Carolina real estate attorney review the proposed contract language before agreeing.

Talk to a Real Estate Attorney

If a new buyer has sent a purchase contract and there are questions about the fees, deadlines, or what happens if the deal falls through, our firm has experienced real estate attorneys who can help explain options and timing under North Carolina law. 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.