How long should I keep records?

QUESTION: I had to file an E&O claim for a transaction that was just over three years old. Fortunately, the transaction file had not been destroyed yet, because our firm is usually pretty good about purging files that are over three years old. Unfortunately, though, the emails and text messages are now missing. The claim itself took me by surprise because of how old it was. Can consumers bring claims even after three years have gone by?

ANSWER: Yes, they can. And while the North Carolina Real Estate Commission only requires you to keep files for three years, it is a good idea to keep them for much longer than that, especially written communications like emails and text messages.

Rule .0108 of the License Law states that brokers “shall retain records of all sales, rental, and other transactions conducted in such capacity, whether the transaction is pending, completed, or terminated. The broker shall retain records for three years after all funds held by the broker in connection with the transaction have been disbursed to the proper party or parties or the conclusion of the transaction, whichever occurs later.” It also states that if agency is terminated, then records must be kept for three years post-termination or the last disbursement of funds, whichever occurs later.

This rule goes into detail about what records to keep, such as contracts, leases, disclosures, etc. However, it also states that agents should retain “any other records pertaining to real estate transactions.”

The most common claim a broker faces in a civil dispute is breach of fiduciary duty. This claim has a statute of limitations of three years, but that three years can extend based on when the claim was discovered. Breach of fiduciary duty, and other allegations, can also support a claim for Unfair and Deceptive Trade Practices, which has a four-year statute of limitations. Other claims brokers may face in a civil case may have up to a ten-year statute of limitations, depending on the circumstances.

A broker’s best defense to most of these claims are the written communications and notes. Even simple things like a spiral notebook that has hand written notes about a property or client may contain very valuable information to help defend against accusations brought years later. They can also be essential to defending against a complaint filed in the North Carolina Real Estate Commission, which has no time limit as to when a consumer may file a complaint.

Given the length of time of potential exposure, three years is very likely not enough retention time, especially for emails, text messages, and notes about the transaction. You may want to discuss your firm’s policy with your attorney to see if it needs to be adjusted.

Release Date: 10/22/2026

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