Buying A Renovated Home? Verify the C of O

If you are buying a recently renovated or modified home, verifying the issuance of a Certificate of Occupancy (“C of O”) may be one of the more critical items on your due diligence list.  The purpose of a C of O is to ensure that a seller has properly conformed to construction codes, zoning regulations, and other laws.

A C of O is not related to “title” and thus your title company will not be responsible for confirming the issuance of a C of O.  Rather, it is incumbent upon you, the homebuyer, to request from the seller or search for an issued C of O.

Certificate of Occupancy in the Contract

The GCAAR regional sales contract refers to the C of O in the form of an acknowledgment, to wit:

The parties acknowledge that, under certain circumstances, when a property is substantially renovated or modified or its usage is changed, a Certificate of Occupancy or a Final Inspection Certification may be required prior to use and occupancy of the property. Additional information on these requirements can be obtained at https://code.dccouncil.us/dc/council/code/sections/6-641.09.html for properties located in the District of Columbia and at https://codelibrary.amlegal.com/codes/montgomerycounty/latest/montgomeryco_md/0-0-0-3515#JD_8-28, for properties located in Montgomery County, MD. In the event a local authority requires the issuance of a Certificate of Occupancy or a Final Inspection Certificate, the Seller agrees to provide evidence thereof.

How to Verify

Verifying the issuance of a C of O can be done with relative ease with most jurisdictions providing an online database for search.  For example, in the District of Columbia, one can search a particular property or seller name for status of a C of O and permits by using their online Department of Business eRecords system – DOB eRecords (Electronic Records Management System) (dc.gov). Similarly, the Department of Permitting Services for Montgomery County, Maryland offers an online database for search – Online Application Search (montgomerycountymd.gov) .

Again, the sales contract obligates the Seller to provide evidence of a C of O for newly renovated or modified property but, as the homebuyer, remember to ask for it and verify its issuance before the attorneys at Federal Title see you at the closing table.