Are you wondering what “due diligence” really means when you buy a home in North Carolina? You are not alone. Between the fee you pay up front, the short timeline for inspections, and local rules in places like Hillsborough, it can feel like a lot. This guide walks you through what to check, who to hire, and how to use your due diligence period to protect your purchase and negotiate with confidence. Let’s dive in.
What due diligence means in NC
The due diligence period
Your purchase contract will set a specific due diligence period. This is your window to inspect the home, confirm records, and decide whether to move forward. You can cancel for any reason during this period, as long as you follow the contract timelines and procedures.
Start scheduling inspections the day your offer is accepted. The time goes quickly, and you want room for follow-up tests or quotes before your deadline.
Due diligence fee vs. earnest money
In North Carolina, you usually pay two kinds of deposits. The due diligence fee is a negotiated, up-front payment to the seller in exchange for the right to inspect and cancel during the due diligence period. It is typically nonrefundable if you cancel, though it may be credited to you at closing depending on the contract.
Earnest money is different. It is held in escrow and is handled under the contract’s contingency terms. Both amounts and timelines are negotiable, so talk with your agent about the best strategy for your situation.
Seller disclosures you should review
Most sellers must provide a Residential Property and Owners’ Association Disclosure Statement. Review it carefully for known issues or past repairs. Treat it as a helpful starting point, not a replacement for professional inspections.
Attorneys and closing in North Carolina
Closings in our state commonly involve a closing attorney or title company. Your attorney will open title work, review documents, and help prepare for settlement. Many buyers also ask an attorney to review contract language and title exceptions before they finalize their decision.
Hillsborough and Triangle specifics
Local rules that shape your plan
Hillsborough sits within Orange County, and a few local items can impact your due diligence:
- Town of Hillsborough Planning and Zoning. Check zoning classification, permitted uses, setbacks, and any overlays that affect the property.
- Historic District considerations. If the home is in the local historic district, exterior work may require review by the Historic Preservation Commission. This can affect future projects like windows, additions, or exterior changes.
- Orange County Environmental Health. If the home uses a septic system or private well, pull permit and inspection records. Confirm the number of approved bedrooms on the septic permit and review any repair or pump records.
- Orange County GIS and Tax Office. Review parcel boundaries, assessed value, flood layers, and any special assessments.
These checks help you avoid surprises about what you can change or build later.
If you are exploring Wake County and Raleigh
Looking across county lines? Similar steps apply. Use Wake County’s Register of Deeds, GIS, and the City of Raleigh Planning and Development for zoning, parcel data, flood layers, and permit history. Local processes and forms vary, so allow time to gather records if you are comparing homes in both Hillsborough and Raleigh.
Your inspection checklist
Primary inspections to schedule first
Order these right away, ideally within the first 3 to 7 days:
- General home inspection. A licensed inspector will review structure, roof, HVAC, electrical, plumbing, foundation, and drainage.
- Termite and wood destroying insect inspection. Many lenders require this, and it can reveal wood rot or past activity.
- Radon testing. Recommended in the Piedmont region. Elevated levels can occur in parts of North Carolina and can be mitigated if found.
- Sewer scope if on municipal sewer. A camera inspection of the lateral line can uncover blockages or damage that are costly to fix.
- Septic inspection and functional test if the home uses septic. Review permit history, tank condition, and absorption field performance with a qualified contractor.
- Private well water testing if on a well. Start with bacteria and nitrates. Consider lead or other parameters based on age and location.
If the home has a fireplace or chimney, roof features, or multiple HVAC systems, add specialists where needed. Older homes or visible concerns can also warrant a structural engineer’s opinion.
Budgeting for reports
Costs vary by property size and scope, but typical ranges include:
- Home inspection: about 300 to 700 dollars
- Radon test: about 100 to 250 dollars
- Septic inspection and test: about 300 to 900 dollars
- Sewer scope: about 150 to 400 dollars
- Private well test: about 100 to 300 dollars
- Survey: from about 500 to over 2,000 dollars depending on the lot
You usually pay for inspections as the buyer. If you find significant issues, you can request repairs or credits during your due diligence window.
When to add specialist reviews
Consider these based on age, disclosures, or inspection findings:
- Lead-based paint testing for homes built before 1978
- Mold or asbestos evaluations if the age or conditions suggest risk
- Environmental screening if near older commercial uses, gas stations, or agricultural sites
- HVAC service inspections and energy assessments for system age or efficiency concerns
Title, survey, and records that matter
Title search and owner’s title insurance
Your closing attorney or title company will run a title search to uncover liens, easements, judgments, unpaid taxes, and other issues that affect ownership. Purchasing owner’s title insurance is strongly recommended. It protects you if a title defect surfaces after closing.
The value of a current survey
A recent boundary survey helps confirm lot lines, encroachments, and easements. This is especially valuable for older parcels, irregular lots, fencing questions, or planned improvements. If there is no current survey, consider ordering one during your due diligence period.
Permits and unpermitted work
Ask for permit records for additions, decks, pools, finishing spaces, or major mechanical updates. Unpermitted work can complicate resale, insurance, and financing. If you are in Hillsborough’s historic district, exterior alterations may require approvals, so verify what was done and how.
Floodplain review and insurance needs
Check whether the property sits in a Special Flood Hazard Area using FEMA flood maps and local floodplain layers. Being in a mapped flood zone can affect insurance requirements and lending, so confirm before your due diligence period ends.
HOA and community documents
If the home is in an HOA, request the full set of documents early. Review declarations, bylaws, rules, recent meeting minutes, budgets, and reserve information. Contracts often give you a short time to review HOA documents, so do not wait to raise questions.
Timeline and negotiation
A practical 14-day schedule
Use this example to pace your steps:
- Day 0. Offer accepted, due diligence period starts, and due diligence fee paid as negotiated.
- Days 1 to 3. Order home, termite, radon, septic or well, and sewer scope as needed. Ask for existing surveys and permit records. Request HOA documents. Open title with a closing attorney.
- Days 3 to 7. Complete inspections, receive reports, and schedule any re-tests or specialist follow-ups.
- Mid-period. Review title findings and any survey results. Prepare repair requests or credit requests.
- End of period. Decide to proceed or deliver a written termination per the contract to preserve your rights.
- After due diligence. Finalize loan conditions, appraisal, and closing schedule. Typical closings occur 30 to 45 days after contract, depending on terms.
Repair requests and credits
You can ask for repairs or a credit based on your inspection results. The seller can agree, counter, or decline. Present clear documentation, provide estimates when available, and communicate early. If you cannot reach agreement, you may choose to terminate within your due diligence period, subject to the contract and the due diligence fee.
Common pitfalls to avoid
- Waiting too long to schedule inspections. Calendars fill quickly, and you may run out of time for follow-ups.
- Skipping septic or well tests on rural properties. These systems are expensive to repair and should be verified.
- Assuming disclosures are complete. Use them as a guide, but always verify with inspections and records.
- Overlooking historic district rules or unpermitted work. These can limit future changes and affect resale.
- Not ordering a survey when boundaries are unclear. Easements or encroachments are easier to address before closing.
Next steps for Hillsborough buyers
Use this quick checklist to stay on track.
Right after acceptance
- Pay the due diligence fee as agreed.
- Order home, termite, radon, septic or well, and sewer scope inspections.
- Request the seller’s disclosure and any existing survey and permit records.
- Ask for full HOA documents if applicable.
- Open title with a closing attorney and review the title commitment and exceptions.
- Check Orange County and Town of Hillsborough resources for zoning, historic overlays, and floodplain status.
Before your deadline
- Review inspection reports and any specialist findings.
- Submit repair or credit requests with supporting documentation.
- Decide to proceed or terminate in writing before the due diligence period expires.
Before closing
- Secure owner’s title insurance.
- Confirm utility transfers and check for any municipal liens or assessments.
- Coordinate appraisal, lender conditions, and final walk-through.
If you are comparing homes in Wake County, mirror these steps using Wake County and City of Raleigh resources.
Ready to map out your due diligence plan around Hillsborough or Raleigh? Reach out for local guidance tailored to your goals. Connect with Rhonda Szostak to walk through timelines, inspections, and negotiation strategy that fit your purchase.
FAQs
What is North Carolina’s due diligence period?
- It is the timeline you negotiate in your contract to inspect a home, review records, and decide whether to move forward or cancel, subject to the contract’s terms.
How is the due diligence fee different from earnest money?
- The due diligence fee is a negotiated payment to the seller for your right to inspect and terminate during the period and is usually nonrefundable, while earnest money is held in escrow and handled under the contract’s contingency terms.
Which inspections are most important in Hillsborough?
- Start with a general home inspection, termite, and radon, then add septic and well testing if applicable, and a sewer scope if the property uses municipal sewer.
Do I need a survey before closing in NC?
- A current boundary survey is not always required but is strongly recommended if lot lines, fences, easements, or encroachments matter for your plans.
What local records should I check in Orange County?
- Review Orange County Register of Deeds, Tax and GIS, Environmental Health for septic or well records, and Town of Hillsborough Planning and Historic Preservation for zoning and district rules.
Can I negotiate repairs after inspections?
- Yes, you can request repairs or credits during your due diligence period, and the seller can agree, counter, or decline; if you cannot reach agreement, you may terminate within the period under the contract’s rules.
