North Carolina Landlord-Tenant Law
North Carolina Landlord-Tenant Law
North Carolina landlord-tenant law is typically landlord-friendly. There are currently an estimated 10 million residents in North Carolina. North Carolina is home to two major cities, Charlotte, with an estimated population of 792,137 residents, and Raleigh, with an estimated 458,880 residents.
With this guide, we’ll go through the laws that landlords and tenants in North Carolina should know about. For Charlotte and Raleigh landlords, we included specific local laws at the end of the guide. Please note that city laws may be more extensive than state laws, and landlords are required to follow both local and state laws.
Security Deposit Laws in North Carolina
Is a security deposit required under North Carolina law?
The landlord is not required to collect a security deposit from the tenant. However, if landlords charge a security deposit, they must comply and act within certain parameters. Specifically, landlords may only charge the tenant a security deposit up to a certain amount, based on the length of the lease term.
For week-to-week tenants, the maximum amount the landlord may charge is two weeks’ rent. For month-to-month tenants, the maximum amount the landlord may charge is 1.5x the monthly rent price. For a longer, fixed-term lease, the maximum amount the landlord may charge is two months’ rent.
We surveyed our landlords in North Carolina to find out what deposit amount they collected. The vast majority (89%) collect a deposit equal to the monthly rent price.
When must a landlord return the deposit by in North Carolina?
The landlord is required to return either part or all of the security deposit to the tenant 30 days after the tenant has vacated the premises unless the landlord needs more time to evaluate the damage. In that case, the landlord must send notice within 30 days, with a final decision within 60 days.
Which situations allow a landlord to withhold a security deposit in North Carolina?
While the landlord is required to return the tenant’s security deposit, the landlord may withhold all or a portion of a tenant’s security deposit from the tenant for damage in excess of normal wear and tear, unpaid rent, unpaid utility bills, breach of lease, costs of re-renting the unit, costs to remove and store tenant’s possessions after eviction, court costs, and any additional unpaid bills the tenant has accumulated during their tenancy that could cause a lien (notice attached to the property telling everyone that a creditor claims tenant owes some money) to be placed against the property.
The landlord must notify the tenant of the deductions and balance, after deductions, within 30 days of the tenant vacating the premises. The landlord must also provide an itemized list of damages or deductions.
Storage Requirements for Security Deposits in North Carolina
Landlords are required to comply with certain requirements in the storage of security deposits. Landlords have two options for storing a tenant’s security deposit:
- The landlord may elect to store the deposit in a trust account, licensed and located in an insured bank or financial institution in the state.
- A landlord can also elect to post a bond for the amount of the security deposit. The bond must be issued by an insurance company with a business license in North Carolina. If the landlord posts a bond for the amount of the security deposit in the state of North Carolina, they are then free to keep the security deposits in a trust account outside of the state if they choose.
The landlord must notify the tenant within 30 days after the beginning of the lease term of the name and address of the bank or institution where the deposit is currently located or the name of the insurance company providing the bond. After the landlord receives a tenant’s security deposit and places it into an account, or transfers any part of the deposit, the landlord shall notify the tenant by mail of such transfer and of the transferee’s name and address.
Here’s an example:
I will be storing the balance of your security deposit in [insert account name] account at [insert bank or other financial institution’s address]. I plan on notifying you if the balance of the deposit is transferred to a new location [bank or financial institution] at any point during your tenancy. If transferred, I will notify you of the name and address of the new location. Please let me know if you have any questions.
If the landlord (or the landlord’s successor in interest) fails to refund the tenant’s security deposit, the tenant may bring a cause of action to recover the balance of the security deposit.
Do landlords have to pay interest on security deposits in North Carolina?
The tenant is not entitled to any interest under North Carolina law.
Can security deposits be commingled with other assets in North Carolina?
Landlords are allowed to commingle the tenant’s security deposit with any of the landlord’s personal assets. However, we recommend separating these funds to avoid any potential mistakes and liability.
Rental Agreement Laws in North Carolina
Are rental agreements required in North Carolina?
Rental agreements are required for tenancies for 12 months or longer in North Carolina. Even if the tenancy is less than 12 months, we encourage our landlords to enter into written rental agreements with their tenants for added legal security. In a survey of our North Carolina landlords, all of them reported they had a written rental agreement.
Get started now by creating an online rental agreement with Rentalutions specifically made for North Carolina landlords. Our state-specific rental agreement includes all the necessary notices and disclosures based on your property’s address. It’s easy to create, modify, and sign a rental agreement.
What are the general lease provisions in North Carolina?
Under North Carolina law, certain provisions must be included in the lease agreement. Most notably, the landlord and tenant are required to include their names on the rental agreement. The landlord should also list the:
- Conditions of occupancy
- An adequate description of the leased premises
Other lease provisions include:
- The term of the lease
- A clear description of the rental space
- Who is liable for utility expenses
- The amount of rent
- The date rent is due
- Penalties for late rent payments
- Landlord’s responsibilities
- Tenant’s responsibilities
- Provisions regarding painting
- Whether pets are allowed
What are the rental agreement notice requirements in North Carolina?
Where there is no written rental agreement,, we advise the landlord to provide the tenant with notice equal to the rental term regarding any verbal changes to the lease. The notice requirements for all other lease terms are as follows:
- On a month-to-month lease, both the tenant and landlord are required to provide seven days’ notice of their intention to terminate the lease.
- For a year-to-year or definite lease term, the tenant and landlord must provide one another with one month’s’ notice or more before the end of the current tenancy, of their desire to terminate.
- On a lease that is at least one week but less than one month, landlord and tenant must provide tenant two days’ notice.
- For a manufactured (mobile) home lease, 60 days notice is required.
Are there any required lease renewal provisions in North Carolina?
There are no specified lease renewal provisions in North Carolina.
Rental Payment Laws in North Carolina
What are the rules regarding rent payments in North Carolina?
In North Carolina, the landlord is free to charge any rent price agreed upon by the parties because there is no rent control or limit required by the state. Similarly, there are no legal requirements for how rent is to be paid.
North Carolina law does not mention the required notice the landlord must provide tenants in order to increase the rent. Unless the rental agreement specifies otherwise, the landlord is typically required to provide the same amount of notice to change the rent of the tenancy as state law requires the landlord to provide when ending the tenancy.
Are tenants allowed to withhold rent under the laws of North Carolina? If so, for what purposes?
In North Carolina, tenants are not allowed to withhold rent payments. However, there are two exceptions. Tenants can withhold rent when:
- Landlord consents to it in writing or
- When a judge or civil magistrate allows the tenant to withhold rent pursuant to a court order
Are landlords required to provide rent receipts in North Carolina?
The landlord is not required to provide the tenant with a receipt when rent has been received. However, we strongly recommend the landlord provide a receipt, for both recordkeeping purposes and to safeguard against any rent payment contention the tenant may raise. The receipt should include the payment date, the amount, the period for which the rent was paid, and the apartment number.
Are there any provisions regarding rent control in North Carolina?
North Carolina does not have any laws addressing rent control or rent regulation.
Late Fees and Grace Period Laws in North Carolina
Is there a legal requirement for late fees in North Carolina?
Landlords are not required to charge a late fee, but if they do, the amount of the late fee is restricted by law.
If rent is due in weekly installments, the landlord may charge a late fee of $4.00 or five percent (5%) of the weekly rent, whichever is greater. If rent is due in monthly installments, the landlord may charge a late fee of $15.00 or five percent (5%) of the monthly rent, whichever is greater.
Most landlords charge late fees to motivate tenants to pay rent on time.
Does North Carolina have a law regarding grace periods?
Yes, there is a required grace period in North Carolina. The landlord may not charge a late fee until rent is five days late.
North Carolina Laws on Repairs: Tenant’s Right, Landlord’s Duty
North Carolina tenants are legally entitled to a rental that meets basic structural, health, and safety standards. It must also be in good repair pursuant to the landlord’s implied warranty of habitability, an implied right in every written or oral residential lease.
Under the implied warranty of habitability law, the tenant’s obligation to pay rent and the landlord’s obligation to maintain habitable (safe, sanitary, and fit) premises depend upon each other. If the landlord breaks his obligation to keep the premises in a reasonable condition, the tenant may be relieved from his obligation to pay part or all of his rent until the landlord makes necessary repairs.
The landlord must be given notice of defects and a reasonable opportunity to make repairs, but he does not have to promise to repair before the tenant withholds rent.
Furthermore, while there is no mandated notice before the landlord enters the premises to correct a repair, we recommend providing the tenant with 24 hours’ notice. Read more below on notice of entry rules.
North Carolina Laws on Eviction
What are North Carolina laws on eviction?
In North Carolina, the landlord may evict the tenant for the following reasons:
- Nonpayment of rent
- Tenant remaining on the premises after the termination of the lease and without the consent from the landlord (“hold-over tenant”)
- Tenant breaching a term or terms the lease or rental agreement
- Drug trafficking and other criminal activity
First, the landlord must provide the tenant with an eviction notice. The landlord must give the tenant written notice of the reason for the eviction and the date that the landlord wants the tenant to vacate the premises. The eviction notice must be personally delivered to the tenant or posted on the dwelling.
A written lease may state how many days of notice must be given by the landlord before the landlord can evict. However, if the lease does not state how much notice is required, the notice required depends on the reason for commencing eviction proceedings:
- Non-payment of rent: Ten-day Notice to Quit. If the tenant does not pay rent within 10 days, the landlord may file eviction papers on the 11th day.
- Holdover tenant: When a tenant does not vacate the premises at the end of the lease term. Notice depends on the length of the lease term:
- Week-to-week: two days’ notice.
- Month-to-month: seven days’ notice
- Year-to-year: one month’s’ notice
- Lease Violations: When the tenant has violated some lease provision, there are no minimum notice requirements if the landlord wishes to commence eviction proceedings. If the lease requires notice and an opportunity to cure the breach, the landlord and tenant must comply with those terms. On the other hand, if there is no such provision, the landlord can file eviction papers upon learning of the tenant’s violation.
- Drug Trafficking and Other Criminal Activities: No minimum notice. Expedition proceedings are expedited.
Once notice has been given, the landlord initiates court proceedings by filing eviction proceedings in either small claims court or district court. Regarding which court to file eviction proceedings in, the rule is as follows:
- Landlord shall initiate eviction proceedings in small claims court if damages do not exceed $10,000.
- If the landlord claims the tenant owes more than $10,000, they should file the eviction papers in district court.
The tenant is not required to be present at the eviction hearing if the landlord is merely seeking possession of the leased premises (and not claiming that the tenant owes money), and the tenant is willing to move out and does not wish to fight the eviction. Failing to appear when the tenant is required to will guarantee an automatic win for the landlord–a “default judgment.”
If the landlord is seeking money damages, a money judgment may be entered against the tenant.
If the tenant chooses to fight the eviction, the tenant must appear. At the hearing, the landlord will speak first and present his or her case to the judge or magistrate. At the conclusion of the landlord’s case, the tenant will have the opportunity to speak. If the tenant has defenses to the eviction, such as improper notice, “self-help” methods, or retaliatory eviction, the tenant should present those defenses. The tenant facing eviction may assert any one of the following defenses:
- The breach of a lease provision is not substantial enough to warrant an eviction
- The allegations are false
- There was improper service
- The notice was improper
- The landlord waived eviction by accepting rent
- If, for criminal activity, the tenant had no knowledge of the activity or that the cotenant had violated any criminal or drug trafficking laws, or the tenant made reasonable attempts to prevent the activity.
- The eviction is in retaliation for the tenant having filed a complaint regarding the condition of the property
- The eviction is based on the tenant’s religion, race, sex, national origin, creed, age, marital or family status, or disability.
Once both parties finish presenting their respective cases, the judge will make a decision. The judge will determine whether the landlord is entitled to possession of the premises.
- If the landlord wins the eviction hearing, a judgment will be entered in his or her favor. After winning the eviction hearing or appeal, the landlord will file for a “writ of possession,” which allows the landlord to remove the tenant from the premises. The landlord must wait ten days after the initial judgment before filing for a writ of possession.
- If the tenant wins the eviction hearing (or the appeal) the tenant will be able to remain on the premises. In this situation, the landlord will also have ten days to appeal an unfavorable decision.
North Carolina Laws on Retaliation
Landlords are prohibited from harassing or retaliating against tenants who exercise their rights. In North Carolina, a landlord must not terminate or refuse to renew a lease within the preceding 12 months, to a tenant who has filed an official complaint to a Government Authority, been involved in a tenant’s organization, made a good faith complaint, or exercised a legal right. Other actions are prohibited.
North Carolina Laws on Domestic Violence, Sexual Misconduct, and Sexual Assault
In North Carolina, the law affords special protections to victims of domestic violence, sexual misconduct, and sexual assault. The landlord cannot discriminate against a tenant or prospective tenant because he or she has been a victim of domestic violence or sexual assault.
Specifically, the landlord cannot:
- Refuse to rent to a prospective tenant who is a victim of domestic violence or sexual assault
- Refuse to renew the tenant’s rental agreement
- Retaliate against the tenant
A tenant who terminates their lease early due to domestic violence is only responsible for paying rent up to the date of termination. The tenant must provide the landlord with 30 days’ written notice and proof of domestic violence status.
The landlord is entitled to verify the tenant’s claim of domestic violence status. Proof required can be any one of the following:
- Order of protection from the police, court, or federal agency
- Signed document from a domestic violence program or sexual assault program that verifies the claim
Moreover, a tenant who is a victim of domestic violence or sexual assault may request that the landlord change or rekey the locks at the tenant’s expense:
- If the perpetrator does not live in the same unit as the victim tenant, the tenant or another member of the tenant’s household can request that the locks on their rental unit be changed. The landlord must change the locks within 48 hours.
- If the perpetrator of the domestic violence lives in the same unit as the victim, the landlord must change the locks within 72 hours.
North Carolina Laws on Changing the Locks and Security Devices
Landlords are not required to change the locks before a new tenant moves in, but we recommend doing so. Furthermore, landlords are required to install:
- Window latches
- Smoke detectors
- Carbon monoxide detectors
After the tenant has made a request for the landlord to install one of these devices, the landlord must respond within a reasonable amount of time.
The results of our North Carolina landlord survey reveal that more than half landlords only rekey the premises if the tenant so requests.
North Carolina Pet Laws
North Carolina does not have any specific pet laws. Landlords are allowed to create their own requirements for pets, most notably, they can decide if pets are allowed, what size is allowed, etc.
Under North Carolina law and the federal Americans with Disabilities Act (ADA), people with disabilities may bring their service animals to all public accommodations, such as government buildings, hotels, restaurants, stadiums, and stores. These laws also require those who operate transportation services to allow service animals. Both laws protect people in North Carolina who use service animals, and you are entitled to rely on whichever law gives you the most protections.
The landlord may charge a reasonable, nonrefundable fee for pets kept by the tenant on the premises.
To read more about pet laws, click here.
Rental License in North Carolina
Landlord rental licenses are not required by North Carolina law. We do advise that you check your local jurisdiction for rental license laws.
Notice of Entry Laws in North Carolina
Do landlords in North Carolina have to provide notice of entry?
Notice of entry laws are absent from North Carolina law, and as a result, the landlord is not required to provide notice of entry and therefore may enter the premises for the following reasons:
- Non-emergency maintenance and repairs
- Showing the unit to prospective tenants
That being said, we recommend at least 24 hours. As you can see below, most landlords in North Carolina are already providing 24 hours’ notice without it being a requirement.
After notice has been given, we recommend the landlord enter the premises at a “reasonable time,” which has been interpreted by most states to mean 9 a.m. to 5 p.m., Monday through Friday, holidays excluded.
Sublease and Assignment Provisions in North Carolina
Under a sublease agreement, the original tenant leases the premises (apartment or house) to another individual. The new tenant must legally abide by the terms of the lease, as they have essentially taken over the lease term for a specified period of time. Unless the lease prohibits subleasing, a landlord may not unreasonably withhold permission to sublet. In North Carolina, subleasing is only allowed if the landlord consents.
A typical sublease provision in the State of North Carolina reads as follows:
“That subject to the terms and conditions hereinafter set forth, said party of the first part (Lessor, or, Owner, or, Landlord) doth hereby let and lease unto said party of the second part (Lessee, or, Tenant) and said party of the second part (Lessee, or, Tenant) doth hereby accept as Lessee (or, Tenant) of said party of the first part (Lessor, or, Owner, or, Landlord) a certain parcel of land together with the buildings and other improvements thereon situate, lying and being in County, North Carolina, and more particularly described as follows.”
Abandonment of Property Provisions in North Carolina
In North Carolina, there are specific procedures on how to handle abandoned property. Personal property is considered abandoned five to seven days after lawful repossession of the property and formal written notice to the tenant.
There are several ways to determine whether the tenant abandoned his or her belongings:
- If there’s evidence the tenant moved out of the rental unit
- If you post notice both inside and outside the premises, and you don’t hear from the tenant within ten days
- If the tenant moved out of rental unit in response to eviction
Once it has been determined that the property is abandoned, the landlord has several options:
- If the property is worth less than $750, the landlord must donate the property to a non-profit organization that focuses on providing household furnishings to individuals in need. The non-profit must store the property for at least 30 days. If within those 30 days, the tenant moves to claim the property, the property must be released to the tenant. The landlord must provide notice at the premises by posting a notice.
- If the property is worth more than $750, state law does not specify what the landlord should do. In the absence of such guidance, the landlord should file an eviction lawsuit, and obtain a writ of possession, which would enable the landlord to lawfully possess the property.
If the tenant moved out because the landlord has taken possession, the landlord has the following options regarding abandoned property:
- If the tenant leaves belongings worth less than $500 at the rental unit after the landlord has taken possession, the landlord must wait five days before disposing of the property. If the tenant claims the property during the five day period, the landlord must release the property to the tenant.
- If the belongings left at the rental unit is worth more than $500, after the landlord has taken possession, then the landlord must wait seven days before selling or disposing of the belongings. The landlord has the option of moving the belongings to a designated and safe location.
- If the landlord sells the belongings, the landlord must send a notice to the tenant informing them of the intent to sell the belongings in seven days unless the tenant claims it. The notice must also contain the following:
- Detailed description of the belongings
- Estimated value of the belongings
- Location where the tenant can claim the belongings before the sale
- Date, time, and location of the sale
- Statement that any leftover proceeds of the sale (after fees for unpaid rent, damages, storage fees, and sale costs have been deducted) can be claimed by the tenant for up to seven days after the sale
If the tenant does not claim the property during the seven-day notice period, then the landlord can proceed with the sale. If the tenant does not claim the leftover proceeds of the sale, the landlord must give those proceeds to the county government.
Required North Carolina Rental Agreement Disclosures
Lead Paint Disclosure: Federal law requires landlords to disclose known information on lead-based paint and lead-based paint hazards before leases take effect. Additionally, landlords must give an EPA-approved information pamphlet.
Tenant’s Initials: Disclosure form requires tenant’s initials. See form here.
Sign-up in less than 60 seconds.
Mold Disclosure: The landlord is required to disclose any structural damage, including but not limited to water, fire, smoke, or insect damage and the condition of the roof, and mold. Click here for mold pamphlet.
Utility Disclosure: A landlord who has expressly or impliedly agreed in the lease to furnish and pay for water, gas, or electric service to the tenant’s dwelling is liable to the tenant if the utility company has cut off utility service to the tenant’s dwelling or has given written notice to the tenant that such utility service is about to be cut off because of the landlord’s nonpayment of the utility bill.
Oil and Mineral Rights Disclosure: The State of North Carolina Mineral and Oil and Gas Rights Mandatory Disclosure Statement requires all sellers of new or existing homes to disclose whether the mineral, oil and gas rights for the property are owned by someone other than the seller. See disclosure form here.
Oft-Cited North Carolina Landlord-Tenant Law
North Carolina landlord-tenant law is governed by Chapter 42 of North Carolina General Statutes.
42-50. Deposits from Tenant.
- Security deposits shall be deposited in a trust account with an institution lawfully doing business in the State. The landlord may, at his or her discretion, furnish a bond from an insurance company licensed to do business in North Carolina. The security deposits from the tenant may be held in a trust account outside of the State of North Carolina only if the landlord provides the tenant with an adequate bond in the amount of the deposits.
42-51. Permitted uses of security deposit.
Security deposits are only allowed for the following reasons:
- The tenant’s possible nonpayment of rent and costs for water or sewer services
- Damage to the premises, including damage to or destruction of smoke alarms or carbon monoxide alarms
- Damages as the result of the non-fulfillment of the rental period
- Any unpaid bills
- Costs of re-renting premises after breach
- Court costs
If a tenancy is week-to-week, the security deposit shall not exceed an amount equal to two weeks’ rent.
If a tenancy is month-to-month, the security deposit should not exceed 1.5x the monthly rent price.
If a tenancy is greater than month-to-month, the security deposit cannot exceed two months’ rent.
42-53. Pet Deposits.
- The landlord may charge a reasonable, nonrefundable fee for pets kept by the tenant on the premises.
42.37. 1. Defense of Retaliatory Eviction
The landlord may not retaliate against a tenant for the following reasons:
- Tenant makes a good faith complaint to a government agency about a landlord’s alleged violation of any health or safety law, or any regulation, code, ordinance, or State or federal law that regulates premises used for dwelling purposes.
- A government authority’s issuance of a formal complaint to a landlord concerning premises rented by a tenant.
- Tenants’ good faith attempt to exercise, secure or enforce any rights existing under a valid lease or rental agreement or under State or federal law.
- Tenants’ good faith attempt to organize, join or become otherwise involved with, any organization promoting or enforcing tenants’ rights.
Tenant may raise the affirmative defense of retaliatory eviction and may present evidence that the landlord’s action is in response to any one of the acts, described above, within 12 months of the filing of such action.
42-42.2. Victim protection – Nondiscrimination.
- A landlord shall not terminate a tenancy, fail to renew a tenancy, refuse to enter into a rental agreement, or otherwise retaliate in the rental of a dwelling because of a tenant, applicant, or a household member’s status as a victim of domestic violence, sexual assault, or stalking.
42-42.3. Victim protection – Change locks.
- A tenant who is a victim of domestic violence or sexual assault has the right to request the landlord change the locks on the premises, whether the perpetrator resides in the unit or if the perpetrators resides elsewhere.
42-45. Early termination of rental agreement by military personnel, surviving family members, or lawful representative.
- North Carolina law grants special protections to “military personnel, surviving family members, or lawful representatives” to terminate the rental agreement early.
42-45.1. Early termination of rental agreement by victims of domestic violence, sexual assault, or stalking.
- Any protected tenant may terminate his or her rental agreement by providing the landlord with a written notice of termination to be effective on a date stated in the notice that is at least 30 days after the landlord’s receipt of the notice.
42-46. Authorized late fees and eviction fees.
- In all fixed-term residential rental agreements, the parties may agree to a late fee, to be chargeable only if any rental payment is five days or more late.
North Carolina Landlord-Tenant Resources
Charlotte Landlord-Tenant Law
Landlord-tenant law in Charlotte is the same as North Carolina state law.
Raleigh Landlord-Tenant Law
Landlord-tenant law in Raleigh is the same as North Carolina state law. For more specific Raleigh information, see Raleigh Housing Authority.
This article is designed to convey information, and not for the purpose of providing legal advice. You should not consider any information in this article to be legal advice. Readers should consider obtaining specific legal advice from an attorney in relation to any decision or course of action contemplated.