Скачать или смотреть BIC Tip 1054 Understanding Due Diligence fees in NC

In this BIC Tip, the Notorious BIC breaks down the Due Diligence Fee (DDF) in North Carolina—what it is, when it’s due, who gets it, and how to keep your buyers and sellers out of trouble.

What you’ll learn

What the DDF is: a negotiated, upfront payment to the seller that buys the buyer’s right to investigate and terminate for any reason within the Due Diligence Period.

When it’s due: by the Effective Date (check your contract—time is of the essence). Late delivery can be a material breach.

Who holds it: typically paid to the seller (not trust), unless your firm’s written policy says otherwise. Always follow brokerage procedures.

Refundability: generally non-refundable to the buyer if they terminate; credited at closing to the purchase price. Refunds are limited (e.g., seller breach or as expressly agreed).

DDF vs. Earnest Money (EMD): DDF goes to the seller now; EMD goes to escrow and may be refundable if buyer terminates within due diligence. Different buckets. Different rules.

Receipting & proof: get a written receipt for DDF delivery (contract receipt section or firm form). Don’t rely on “we dropped it off.”

Practical amounts: how market pressure, price point, and risk tolerance affect DDF strategy in multiple-offer or new-build scenarios.

Funding & delivery tips: avoid mail delays; use trackable delivery or verified electronic methods per firm policy. Watch for wire fraud—verify instructions every time.

If the deal fails: appraisal short? loan denied? Unless the contract says otherwise, DDF usually stays with the seller; EMD treatment depends on timing and terms.

BIC coaching cues

Put DDF amount, payee, due date/time, and delivery method on your deal timeline.

Confirm who will physically deliver and how you’ll evidence receipt.

Train brokers to explain DDF ≠ EMD in plain language at the consult.

Use addenda for any change to DDF, EMD, or timelines—get it in writing.

Remind sellers: if the contract closes, DDF is credited; if it doesn’t (and buyer terminates properly), DDF may be kept—talk to a tax pro about reporting.

Quick glossary

Due Diligence Fee (DDF): paid to seller; buys termination right; typically non-refundable; credited at closing.

Due Diligence Period: buyer’s window to inspect, appraise, review title/HOA, finalize loan, and negotiate—or terminate.

Earnest Money Deposit (EMD): escrowed good-faith funds; refund depends on contract and timing.

This video is education only. Always follow your firm’s policies, the current NC forms, and NCREC guidance. When in doubt, consult a North Carolina real estate attorney.

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