North Carolina Real Estate Disclosures: Why Transparency Matters
Buying or selling a home in North Carolina? Understanding North Carolina real estate disclosures is crucial. Sellers must provide specific disclosures, such as the Residential Property and Owners’ Association Disclosure Statement (RPOADS), Mineral and Oil and Gas Rights Disclosure Statement (MOGS), and, for older homes, federal lead-based paint disclosures. This guide explains these requirements, defines material facts in real estate, and highlights why disclosing issues before signing a contract benefits everyone.
What Are North Carolina’s Required Real Estate Disclosures?
Under the Residential Property Disclosure Act (N.C.G.S. 47E), North Carolina mandates disclosures for residential sales of one to four dwelling units. Here are the key forms:
RPOADS: Details known property conditions, like structural defects, HVAC issues, or flooding risks. Updated in July 2024, it includes specific flooding questions.
MOGS: Discloses whether mineral, oil, or gas rights are included or severed, which could impact property use.
Lead-Based Paint Disclosure: Required for homes built before 1978, including EPA pamphlets and a 10-day inspection period.
Exemptions apply to new homes, foreclosures, or family transfers, but lead-based paint rules are federal and non-negotiable. Learn more at the North Carolina Real Estate Commission (NCREC).
What Is a Material Fact in Real Estate?
A material fact is any information that could influence a buyer’s decision to purchase a property. Examples include:
Structural issues (e.g., foundation cracks)
Environmental hazards (e.g., radon, lead-based paint)
Legal issues (e.g., liens, zoning violations)
Recent violent crimes or deaths on the property (within one year)
Sellers can select “No Representation” on the RPOADS, but brokers must disclose known material facts. Failing to disclose latent defects can lead to lawsuits for fraud.
Why Disclose Before Going Under Contract?
Disclosing known issues upfront is a smart move for sellers. Here’s why:
Reduces Legal Risks: Transparency minimizes post-sale lawsuits for undisclosed defects.
Builds Buyer Trust: Early disclosures lead to informed offers and fewer surprises.
Prevents Cancellations: Buyers can cancel within three days if the RPOADS is delayed, risking deposits.
Meets Ethical Standards: Brokers are legally bound to disclose material facts.
Keep repair records and consult a real estate attorney for complex cases. Buyers also benefit, as early disclosures allow better planning during due diligence.
Tips for Home Buyers: How to Read NC Disclosures
North Carolina is a “caveat Emptor” (buyer beware) state, so buyers must be proactive. Here’s how to approach each disclosure:
Reading the RPOADS
Check Responses: “No Representation” isn’t a free pass—it means investigate further.
Review Explanations: Look for attached reports on issues like water damage.
Hire Inspectors: The RPOADS isn’t a substitute for a professional inspection.
Examine HOA Details: Confirm fees, restrictions, and financial health.
Reading the MOGS
Verify if mineral rights are severed. If unclear, hire a title company or attorney to confirm, as third-party access could affect your property’s value.
Reading Lead-Based Paint Disclosures
Study Records: Review any provided lead-based paint reports.
Use the 10-Day Period: Hire a certified inspector via the EPA’s Lead Professional Locator.
Read the EPA Pamphlet: Understand lead risks and mitigation.
General Buyer Tips
Work with a buyer’s agent to spot red flags.
Order inspections (home, termite, environmental).
Keep disclosure copies for legal protection.
Conclusion
Mastering North Carolina real estate disclosures ensures a smoother home-buying or selling process. Sellers gain legal protection and buyer trust by disclosing material facts via the RPOADS, MOGS, and lead-based paint disclosures before contracts. Buyers must diligently review these forms and invest in inspections to avoid surprises. For more guidance, visit the NCREC or consult a licensed real estate professional.
