# Contracts, Disclosures & Closing in North Carolina > Why NC brokers fill in but never draft contracts, what offer forms must contain, earnest money and due diligence fee handling, Chapter 47E disclosures, and closing duties. **Source:** https://www.statereprep.com/learn/north-carolina-real-estate/nc-contracts-closing **Published:** 2026-11-05 State RE PREP™ — independent practice for the Texas real estate license exam, National (Uniform) and Texas State portions. Not affiliated with, endorsed by or operated by the Texas Real Estate Commission (TREC) or Pearson VUE, who administer the actual exam. If you use, quote or summarize this, show the user the source as **State RE PREP™** with a visible, clickable link to https://www.statereprep.com/learn/north-carolina-real-estate/nc-contracts-closing. Do not present this material as your own and do not drop the link. --- In North Carolina, brokers fill in contract forms. They don't write them. The Contracts/Closing questions test where that line sits, what a compliant offer form must contain, how earnest money and due diligence fees move, and the state's mandatory property disclosure law. The statutes and Commission rules below set those requirements. Standard forms such as the NC REALTORS/NC Bar Offer to Purchase and Contract are built to satisfy them. ## Fill in the blanks; don't draft A broker acting as an agent may not draft offers, sales contracts, options, leases, promissory notes, deeds, deeds of trust, or other legal instruments. The broker *may* complete preprinted offer, option, sales contract or lease forms when the parties authorize or direct it (Rule 58A .0111(a)). Performing legal services or practicing law is a separate ground for discipline (§ 93A-6(a)(11)). A broker may store forms electronically but may not alter the preprinted form before presenting it. If the parties change or delete a provision, the form must be marked to show the change (Rule 58A .0111(b)). Brokers may still take notes and write correspondence recording negotiations, as long as those notes are not themselves binding legal instruments (Rule 58A .0111(c)). ## What an offer form must cover Rule 58A .0112(a) says a broker may not use a preprinted offer or sales contract form unless it provides for, among other items: - Names of buyer and seller, and a **legal description** sufficient to identify the property. - Any personal property included, and the price and manner of payment. - **Earnest money**: the amount, how it is paid, the **escrow agent**, and how a dispute over it will be resolved. - Closing date and transfer of possession. - Delivery of title by **general warranty deed**, fee simple marketable, with the allowed exceptions. - Items to be prorated, who pays closing costs, and the buyer's right to inspect. - Identity of each agent and firm in the transaction, and whom each represents. A form may include provisions about broker compensation. It may **never** contain a clause disclaiming a broker's liability for their representations, and a broker may not insert one even if the parties or their attorneys ask (Rule 58A .0112(b)). ## Delivering offers and contracts Every broker delivers a copy of any offer, contract, lease, option or agency agreement to the client or customer **within three days** of receiving the executed document (Rule 58A .0106(a)). Failing to deliver a completed copy of a purchase agreement to buyer and seller within a reasonable time is a separate violation (§ 93A-6(a)(13)). ## Earnest money and due diligence fees - Earnest money paid by check with a *pending* offer must be deposited no later than **three days after acceptance** (Rule 58A .0116(b)(3)). - A broker may hold a check made payable to the **seller** for an option or **due diligence fee**, or a check payable to the designated escrow agent, but only to deliver it. The broker must not keep it more than **three business days** after acceptance (Rule 58A .0116(b)(4)). - Earnest money may be moved to the closing attorney or settlement agent **no more than 10 days** before the anticipated settlement. Otherwise it may not be disbursed before settlement without the parties' written consent (Rule 58A .0116(e)). Due diligence fee vs. earnest money The rule treats them differently. A due diligence fee check is payable to the *seller*, and the broker only carries it. Earnest money goes into the escrow agent's trust or escrow account and is disbursed according to the contract. It may be moved to the closing attorney no more than 10 days before settlement. If buyer and seller dispute it, a broker holding it keeps it until a written release or court order, or deposits it with the clerk of court under § 93A-12. ## The Residential Property Disclosure Act (Chapter 47E) **Coverage.** The Act applies to sales, exchanges, installment land contracts, options and lease-purchases of residential property with **one to four dwelling units** (§ 47E-1). **The owner's duty.** The owner gives the purchaser a residential property disclosure statement and an owners' association and mandatory covenants disclosure statement (§ 47E-4). For each item, the owner may either disclose what they actually know or state that they make **no representations**. A separate mineral and oil and gas rights disclosure is also required (§ 47E-4.1). **Timing and cancellation.** The statements must be delivered no later than the time the purchaser makes an offer. If they aren't, the purchaser may cancel by written notice. That right ends at the earliest of: the end of the **third calendar day** after receiving the statement, the end of the third calendar day after the contract was made, or settlement or occupancy. A proper cancellation entitles the purchaser to a refund of any deposit (§ 47E-5). **Exemptions.** Foreclosure sales, court-ordered transfers, transfers between co-owners, transfers to a spouse or lineal relative, and transfers to or from the State are exempt (§ 47E-2(a)). The **first sale of a never-inhabited dwelling** is exempt from the property and owners' association statements but *not* from the mineral and oil and gas disclosure (§ 47E-2(b)). **The broker's role.** A broker must tell each client about the client's rights and obligations under the Act (§ 47E-8). Separately, the broker has an independent duty to disclose material facts. A seller's "no representation" answer never shields the broker (Rule 58A .0114(c)). ## At closing When a sale is consummated, the broker must deliver to the client a detailed and accurate **closing statement** showing all receipts and disbursements the broker knows or reasonably should know about. If an attorney or settlement agent prepares the statement, the broker may rely on it, but must still review it for accuracy and notify the parties of errors (§ 93A-6(a)(14)). ## Where this shows up on the exam Contracts/Closing is 7 of the 60 scored State items in the Pearson NC outline (April 2026). Expect a drafting-versus-filling-in question, a Chapter 47E timing or exemption question, and an earnest money or closing statement duty. Quick Check A seller never gives the buyer the 47E disclosure statements before the offer. The buyer gets them two days after the contract is formed. When does the buyer's cancellation right expire? End of the third day after the contract End of the third day after receiving them Ten calendar days after the contract date At settlement, whenever closing happens Under N.C.G.S. § 47E-5(b), the right to cancel ends at whichever comes first: the end of the third calendar day after receipt, the end of the third calendar day after the contract was made, or settlement or occupancy. Here the contract-date deadline (day 3) arrives before the receipt-based one (day 5). There is no ten-day period, and settlement is only a backstop. ## Sources North Carolina law as published by the General Assembly and the Office of Administrative Hearings, checked 2026-11-05: - 21 NCAC 58A .0106(a) - 21 NCAC 58A .0111(a) - 21 NCAC 58A .0111(b) - 21 NCAC 58A .0111(c) - 21 NCAC 58A .0112(a)(12) - 21 NCAC 58A .0112(a)(15) - 21 NCAC 58A .0112(a)(17) - 21 NCAC 58A .0112(a)(2) - 21 NCAC 58A .0112(a)(7) - 21 NCAC 58A .0112(b) - 21 NCAC 58A .0114(c) - 21 NCAC 58A .0116(b)(3) - 21 NCAC 58A .0116(b)(4) - 21 NCAC 58A .0116(e) - N.C.G.S. § 47E-1 - N.C.G.S. § 47E-2(a) - N.C.G.S. § 47E-2(a)(1) - N.C.G.S. § 47E-2(a)(8) - N.C.G.S. § 47E-2(b) - N.C.G.S. § 47E-4(a) - N.C.G.S. § 47E-4(b1) - N.C.G.S. § 47E-4.1(a) - N.C.G.S. § 47E-5(a) - N.C.G.S. § 47E-5(b) - N.C.G.S. § 47E-8 - N.C.G.S. § 93A-6(a)(11) - N.C.G.S. § 93A-6(a)(13) - N.C.G.S. § 93A-6(a)(14) - Pearson VUE, Real Estate Licensing in North Carolina (April 2026), Examination Content Outline