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What is due diligence in the home-buying process?

On Behalf of | Apr 29, 2024 | Real Estate Law |

The home-buying process is one that takes considerable work because you have to ensure that everything is up to par and that any property that you are interested in is a good investment. Because of the cost of any real estate investment, there’s little room for mistakes in the process.

There are several things that you’ll need to review as part of due diligence. Making sure that everything is in order can help you to ensure that you’re making the best decision for your situation.

Have a property inspection

The property inspection is the cornerstone of the due diligence process. This involves hiring an independent inspector to look at various aspects of the home, including the HVAC, roof, foundation and structural integrity. They’ll also look at the plumbing and electrical systems. If they find any issues, they’ll include it in the report. You can then use this to negotiate with the sellers. In some cases, you may be able to back out of the contract if you have a contingency clause related to inspections.

Check the title

You also need to have the title checked. This process is to see if anyone else has a claim to the property. Checking the zoning and land use are also important. These provide you guidance about what you can do with the property. You should also find out if there are any easements on the property. An easement means that someone else has a legal right to use part of your property for specific reasons, so this can have a major impact on your ability to use your property as you intend.

Learn about the neighborhood

The neighborhood the home is in plays a major role in how you’re able to enjoy living there. Ideally, you’ll be able to find a home that’s in a safe neighborhood that’s close to amenities and services that you’ll use.

Another way that you can protect yourself with the home-buying process is to have a legal representative review the contracts and all documents related to the sale. This effort can provide you with greater protection as you move forward.