North Carolina Residential Lease Agreement
North Carolina lease agreement: security deposit caps from 2 weeks' to 2 months' rent, 30-day itemized return. Free to create, attorney review available.
Introduction
A residential lease agreement is a legally binding contract that sets the terms under which a tenant rents a landlord's residential property: the rent, the length of the tenancy, the security deposit, each side's responsibilities, and how the tenancy ends. In North Carolina, Chapter 42 of the General Statutes governs the landlord-tenant relationship, and the Tenant Security Deposit Act (N.C. Gen. Stat. Sections 42-50 through 42-56) sets the deposit rules. A North Carolina landlord may charge up to two weeks' rent for a week-to-week tenancy, one and one-half months' rent for a month-to-month tenancy, or two months' rent for a longer term (N.C. Gen. Stat. Section 42-50). The deposit must sit in a trust account at a licensed, federally insured institution, or be backed by a surety bond, and the landlord must return it with a written itemization within 30 days after the tenancy ends, or provide an interim accounting within 30 days and a final one within 60 days if the claim cannot be determined that quickly (N.C. Gen. Stat. Section 42-52). Federal law requires a lead-based paint disclosure for housing built before 1978, and North Carolina requires the landlord to tell the tenant, in writing, where the deposit is held within 30 days after the lease begins. Chapter 42 sets no statutory entry-notice hours, so reasonable notice is the practical standard. Either side ends a month-to-month tenancy with 7 days' notice under Section 42-14.
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Key Things to Know
- 1
A residential lease agreement is a contract between a landlord (lessor) and a tenant (lessee) that sets the rent, term, security deposit, and each party's responsibilities, and spells out how the tenancy ends.
- 2
The security deposit cap depends on the tenancy type: two weeks' rent for week-to-week, one and one-half months' rent for month-to-month, or two months' rent for terms longer than month-to-month (N.C. Gen. Stat. Section 42-50). The landlord must return it with an itemized accounting within 30 days of the tenancy ending, or within 60 days if a final claim amount cannot be determined in 30.
- 3
North Carolina requires a federal lead-based paint disclosure for housing built before 1978, plus a written notice, within 30 days of the lease starting, telling the tenant the name and address of the bank or bonding company holding the deposit (N.C. Gen. Stat. Section 42-50).
- 4
Chapter 42 has no statute setting entry-notice hours for a landlord entering an occupied rental, so North Carolina leases should state a reasonable-notice practice rather than rely on a numeric rule that does not exist in state law.
- 5
A late fee is capped at the greater of $15 or 5% of monthly rent (or $4 or 5% of weekly rent), chargeable only once per late payment and only after a grace period of 5 calendar days past the due date (N.C. Gen. Stat. Section 42-46).
- 6
To end a month-to-month tenancy, either the landlord or tenant gives 7 days' notice to quit (2 days for week-to-week, one month for year-to-year) under N.C. Gen. Stat. Section 42-14. Chapter 42 sets no separate rent-increase notice; a landlord raising rent on a periodic tenancy must terminate and re-offer under those same notice periods.
- 7
North Carolina has no statewide rent control, and Section 42-14.1 bars any county or city from regulating the rent charged on privately owned residential rental property, so there is no local rent-control ordinance to check either.
Key decisions before you file
Before you file a Residential Lease Agreement in North Carolina, a few decisions shape the document: which option to choose and what each one means. The Residential Lease Agreement guide walks through them.
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North Carolina Requirements for Residential Lease Agreement
Security Deposit Cap by Tenancy Type
The deposit shall not exceed two weeks' rent for a week-to-week tenancy, one and one-half months' rent for month-to-month, or two months' rent for terms longer than month-to-month (N.C. Gen. Stat. Section 42-50(b)).
Hold the Deposit in a Trust Account or Bond
The landlord must deposit the tenant's security deposit in a trust account with a licensed and federally insured depository or trust institution authorized to do business in North Carolina, or furnish a surety bond covering the deposit instead (N.C. Gen. Stat. Section 42-50).
Disclose the Deposit Location Within 30 Days
The landlord must notify the tenant in writing, within 30 days after the lease term begins, of the name and address of the bank or institution holding the deposit, or the name of the insurance company providing the bond (N.C. Gen. Stat. Section 42-50).
Return the Deposit With Itemization Within 30 Days
The landlord must itemize any damage and mail or deliver the itemization and any deposit balance no later than 30 days after the tenancy ends and possession is returned. If the claim cannot be determined within 30 days, an interim accounting is due within 30 days and a final accounting within 60 days (N.C. Gen. Stat. Section 42-52).
No Statutory Entry-Notice Hours
North Carolina General Statutes Chapter 42 contains no provision requiring a landlord to give advance notice before entering an occupied residential unit. A lease should still state a reasonable-notice practice, since no numeric hours rule exists in state law.
Late Fee Cap and 5-Day Grace Period
A late fee is chargeable only if rent is 5 or more calendar days late, and is capped at the greater of $15 or 5% of the monthly rent (or $4 or 5% of the weekly rent), imposed only once per late payment (N.C. Gen. Stat. Section 42-46).
Give 7 Days' Notice to End a Month-to-Month Tenancy
Either party ends a month-to-month tenancy with 7 days' notice to quit (2 days for week-to-week, one month for year-to-year). Chapter 42 sets no separate rent-increase notice; to raise rent on a periodic tenancy, the landlord must terminate under this same notice period (N.C. Gen. Stat. Section 42-14).
No Statewide or Local Rent Control
North Carolina has no statewide rent control, and state law preempts local regulation: no county or city may enact or enforce an ordinance regulating the rent charged for privately owned residential rental property (N.C. Gen. Stat. Section 42-14.1).