NC Real Estate Disclosures and Material Facts Explained

Buying or selling a home in North Carolina? The disclosure rules here are specific, and they protect both sides when everyone follows them. This guide covers the forms sellers must hand over, what counts as a material fact, what happens when something turns up during due diligence, and how to read each disclosure as a buyer. I have folded my earlier post on material facts into this one so it all lives in one place.

North Carolina's Required Seller Disclosures

Under the Residential Property Disclosure Act, N.C.G.S. Chapter 47E, sellers of one to four unit homes must give buyers two statements before an offer is made.

The Residential Property and Owners' Association Disclosure Statement (RPOADS). A four page form where the seller answers questions about the home's condition: structure, roof, plumbing, electrical, HVAC, water and sewer, flooding, and any owners' association. The revised form from July 2024 added specific flooding questions and larger type.

The Mineral and Oil and Gas Rights Mandatory Disclosure Statement (MOGS). One page that says whether mineral, oil, or gas rights have been severed from the property, which can give a third party rights to the land.

Lead based paint disclosure. For homes built before 1978, federal law requires the seller to disclose known lead hazards, provide the EPA pamphlet, and allow a 10 day window for a lead inspection.

Some sales are exempt from the state forms, including new construction and transfers between family members, but the federal lead rule has no exemption for age of home. If a seller does not deliver the RPOADS before the offer, the buyer can cancel within three days of signing the contract or three days of receiving the statement, whichever comes first. Source: NCREC, Sellers Required by Law to Provide Two Disclosure Statements.

What Is a Material Fact?

A material fact is any fact that could affect a reasonable person's decision to buy, sell, or lease a property. The North Carolina Real Estate Commission groups them into four categories:

Facts about the property itself: structural defects, a leaking roof, drainage problems, a failing HVAC system, work done without permits.

Facts that relate directly to the property: pending zoning changes, restrictive covenants, a planned road widening next door.

Facts affecting a party's ability to complete the sale: a buyer who cannot qualify for the loan, a seller who cannot deliver clear title.

Facts known to be of special importance to a party: something a buyer has said matters to them, like a specific zoning use or whether pets lived in the home.

Here is the part that surprises people. A seller can answer "No Representation" on the RPOADS, and that is legal. A broker cannot. Brokers must disclose material facts they know or reasonably should know to every party in the transaction, including the other side, no matter what the seller checked on the form. N.C.G.S. 93A-6(a)(1) lets the Commission discipline a broker for willful or negligent misrepresentation or omission of a material fact. Failure to disclose is the most common consumer complaint the Commission receives.

Two things are not material facts under North Carolina law, even if a buyer would want to know: a death or serious illness that happened in the home, and a registered sex offender living nearby. G.S. 39-50 says sellers need not volunteer these, though no one may lie if asked directly.

Real Examples From the Commission

NCREC publishes disciplinary cases, and the material fact ones follow patterns worth knowing. A broker failed to disclose that renovations were done by an unlicensed contractor without permits. Another reported square footage that included unheated space, overstating the home by more than 1,200 square feet. Another never checked the septic permit, so a buyer believed a home was approved for four bedrooms when the permit allowed three. Each of these was knowable, and each led to discipline. Source: NCREC bulletins on material facts.

Why Sellers Should Disclose Early

Disclosing known problems before you go under contract is the safer path. It cuts the risk of a lawsuit after closing, it leads to offers that already account for the issue instead of renegotiation later, and it avoids the three day cancellation right that late disclosure creates. Keep your repair records and attach reports to the RPOADS when you have them. For anything unusual, talk with a real estate attorney before listing. I often work with The Justice Law Group in Greensboro.

When a Material Fact Turns Up During Due Diligence

North Carolina's due diligence period is the buyer's time to investigate: home inspection, pest inspection, septic evaluation, survey, title search, HOA documents. When something turns up, the buyer has three choices.

Walk away. Terminate in writing before the due diligence period ends and the earnest money comes back. The due diligence fee, paid to the seller up front, usually stays with the seller.

Negotiate. Ask for a repair, a price reduction, or a credit at closing.

Proceed. Accept the issue and move forward.

If a seller materially breaches the contract, a buyer may be able to recover the due diligence fee and earnest money. That is an attorney conversation, not a form.

How Buyers Should Read Each Disclosure

RPOADS. Treat "No Representation" as a prompt to investigate, not a clean bill of health. Read any attached reports. Hire your own inspectors; the form is not a substitute for an inspection. If there is an owners' association, confirm fees, restrictions, and financial health. My post on why you cannot get condo financials before making an offer explains the timing.

MOGS. If it says mineral rights are severed or the seller does not know, ask the closing attorney to check the chain of title before your due diligence period ends.

Lead based paint. Read any reports the seller provides, read the EPA pamphlet, and use the 10 day window for a certified inspection if the home is old enough to matter to you.

In general. Work with a buyer's agent who will tell you what they see. Order the inspections your agent recommends. Keep copies of every disclosure you receive.

The Short Version

Sellers protect themselves by disclosing early and keeping records. Buyers protect themselves by reading every form, hiring inspectors, and using the due diligence period well. Brokers on both sides owe everyone the material facts they know. More on the paperwork behind a sale is in my first time buyer resources and the blog index.

Joy Watson Real Estate is an independent, non-corporate brokerage in Greensboro, NC. Joy Watson is a licensed North Carolina real estate broker (Broker-in-Charge). Questions about buying, selling, or renting in the Triad? Reach out through JoyWatsonRealEstate.com.

This post is general information, not legal, tax, or financial advice. Talk to your attorney, CPA, or lender about your situation.