Hi there! I'm a North Carolina real estate agent serving clients in all stages of life. Whether you're buying your first home, moving from out of state to downsize, or moving from one area in North Carolina to another I am here to support you and make things happen.
One of the most frequently asked questions I receive from clients relocating to North Carolina is, what is due diligence? Understanding due diligence is essential for buyers entering the real estate market in North Carolina. Unlike many other states, North Carolina operates under the principle of Caveat Emptor, which translates to “buyer beware” in Latin. This means that historically, sellers have had more legal protection than buyers. It’s an important concept to grasp, particularly for those coming from states with different real estate laws. That’s why I’ve put together my expertise of over 10 years as a realtor in North Carolina to help you in understanding due diligence. I’ll share everything you need to know from its purpose, and how it offers protection to buyers.
What is Due Diligence?
In North Carolina, due diligence is a negotiated timeframe where buyers have the opportunity to conduct inspections, negotiate repairs, and appraise the property. It is a vital phase that allows buyers to assess the property’s condition and ensure it aligns with their expectations. Essentially, due diligence allows buyers to conduct inspections, negotiate repairs with the seller, and have the property appraised before committing to the purchase.
Understanding the Process of Due Diligence
Typically, the average due diligence period in North Carolina lasts around three weeks. However, this period can be negotiated between the buyer and seller to meet their specific needs. During this time, the buyer pays a negotiated fee directly to the seller as compensation for taking the house off the market while the buyer conducts their due diligence. The fee is not refundable unless the buyer terminates the agreement within the due diligence period. It is crucial to work with a knowledgeable real estate professional who can provide guidance on determining an appropriate fee.
Exploring Buyer Protections
Due diligence grants buyers significant flexibility and protection during the home buying process. If, for any reason, the buyer determines that the property is not suitable for their needs, they have the right to terminate the agreement within the due diligence period and walk away from the transaction. Although the buyer forfeits the due diligence fee to the seller in this scenario, they have the freedom to protect their interests without incurring further obligations.
Closing the Deal
If the buyer proceeds with the purchase, the due diligence fee is credited back to them on the closing statement. This means that the fee paid is applied as a credit towards their overall closing costs.
In North Carolina, due diligence serves as a crucial safeguard for buyers. This negotiated timeframe allows buyers to conduct inspections, negotiate repairs, and appraise the property before finalizing the purchase. That’s why it’s essential to work with an experienced realtor guiding you through the process and helping make informed decisions. With my over 10 years of experience as a realtor in North Carolina, I’m committed to assisting you throughout your journey, ensuring that you navigate the due diligence process with confidence. If you want peace of mind during real estate journey, book in a free call for us to get connected!