North Carolina Condo Due Diligence Checklist

Confirm you received these

Commonly provided in the resale package — verify none are missing.

• Declaration/CC&Rs — The governing document (statutorily required for both condos and HOAs). *Required by statute for creation; obtain from closing attorney or title*.
• Bylaws — Internal rules for meetings/elections. *Required by statute; usually on record with Secretary of State for incorporated associations*.
• Rules & Regulations — Board-adopted house rules. *Not required by state, but mandatory to follow; ask the association.*.
• Current Budget (Proposed) — Shows planned income/expenses. *Statute mandates a budget be prepared annually (47F-3-107.2). Board must share a summary with owners, but the full budget may not be automatically given – buyers should request it.
• Most Recent Financial Statements — Year-end income statement and balance sheet. *Not statutorily required for resale, but critical to gauge HOA financial health.*.
• Reserve Study (if any) — Professional report on reserves. *Not required; rarely exists, but a big gap if missing.* Flag if none.
• Reserve Account Statement — Current reserve fund balance. *Not required by statute; request it. If low, raise a red flag.*.
• Board Meeting Minutes (last 12–24 months) — Insight into operations, disputes, upcoming projects. *Owners usually have right to request; at least request summaries if possible.*.
• Annual Meeting Minutes — To verify budget ratification, board elections, special assessments. *Good for timeline of major decisions.*.
• Master Insurance Policy (Declarations page) — Details coverages and deductibles. *Statute requires associations to carry insurance, but not that sellers must provide it. Buyer should request the declarations page (may need to ask the management or HOA attorney).
• Deductible Schedule — Document listing any wind/hail or other deductibles. *Usually part of policy; ask for it.*.
• Claims History — List of all claims made on the policy (last 3–5 years) and payouts. *Not statutorily required; valuable for risk assessment.*.
• Pending Litigation Summary — Description of all lawsuits (construction, collection, etc.) involving the association. *Not required by statute at resale; must request.
• Special Assessment Notices — Copies of any approved or planned special assessment ballots or notices. *Statute requires owners be notified, but buyers should double-check.*.
• Loan Documents — If the association has mortgage(s) or lines of credit (e.g. for bulk insurance or capital projects). *No direct statute; request from the board.*.
• Engineering/Structural Reports — Any engineer’s or architect’s inspection reports on buildings or infrastructure. *Not common in NC but valuable; ask if available.*.
• Facade/Balcony/Milestone Inspection Reports — If any voluntary inspections have been done (e.g. after Hurricane damage). *Not required by law; ask.*.
• Notice of Violations or Fines — Any outstanding fines or violation letters against the property (could affect transfer fees). *Board may not automatically share; request from seller.*.
• Delinquency Report — Summary of how many owners are late and by how much. *Helpful for financial risk. Often provided as part of resale certificate (though NC law only mandates fee statement).*.
• Management Contract — If a property manager is used, the contract terms and fees. *Not required by statute; ask for a copy.*.
• Developer Transition Documents — If property is recently out of developer control: status of Declarant rights, inspection reports from developer, warranties. *Especially important in new developments (NC law allows up to certain lot sales or time before transition).*.