A certificate of occupancy is
the town's sign-off.

A certificate of occupancy, usually shortened to CO, is a municipal document saying a structure has been inspected and is cleared to be lived in. It is the town signing off, not the state and not the lender. Buyers of new construction meet it at the end of the build, when the CO is what turns a finished house into one somebody can move into. Buyers and sellers of existing homes meet it because a number of South Jersey municipalities also want an inspection when a house changes hands.

Whether a resale needs one is a question for the town the house sits in, because the requirement is not uniform across New Jersey and neither are the inspections behind it. On the standard state form, though, the assignment is clear enough: the seller is the one who obtains the certificate and who covers the repairs the inspector calls for. There is a second timing point that catches people out. Where a property runs on a septic system or a private well, the town may want those certifications in hand before it will issue the CO at all, so two clocks are running and one of them has to finish first.

Say a house in Gloucester County is under contract with an October closing. The seller calls the township in early September, learns the inspection is required and books it, and the inspector flags a handrail and a smoke detector. Both are small, and there is time. The same two items found the week of closing are what moves a settlement date.

What to ask, and who answers it. Ask your municipal office whether a certificate is required on a sale there, what the inspection covers, and how far out they are booking, because that is the part nobody else can tell you. Your agent can tell you which items commonly come back in that town and how sellers there handle them. Your attorney is the one to ask about what the contract says on repairs. If the property is on septic or a well, tell us early and we can line up the testing alongside the inspection instead of after it.