Q:

What are some of the items on a due diligence checklist for real estate?

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Quick Answer

Items that may appear on a due diligence checklist for real estate include a title review, property inspection, checks with local zoning laws and a review of all service contracts. The checklist may also include several other sections to check the current state of the property, the availability of finances and address any pending legal matters.

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Full Answer

Real estate agents commonly use a due diligence checklist to help track the research on a property prior to investment, which includes multiple areas that cover all the different aspects of the process and the checks to identify any potential issues. Many checklists begin with a focus on discovering the history of the property, such as a title search to find out its previous owner and if there are any pending back taxes or liens on it. The search can also cover a check into the owners and that the property is in compliance with the appropriate laws for that area, such as having a permit for additions.

The checklist also includes sections for inspecting the condition of the property, which includes both ensuring the structural integrity and identifying any potential repairs or improvements it needs. This helps the investor understand the full cost of the property prior to purchasing. The checklist can also include reminders to review all contracts for any current renovations or services on the property as well as areas to cover the legal transfer of the property to the new owner.

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