Due Diligence

Due diligence refers to the comprehensive appraisal of a business, asset, or individual prior to signing a contract, or as part of an ongoing agreement. It is essentially a thorough investigation to confirm all material facts and details before entering into an agreement or transaction.

In real estate, due diligence typically involves a wide range of checks and inspections to ensure that the property or investment is exactly as represented and there are no hidden problems or liabilities. These may include:

Title Search: This involves examining public records to confirm the legal ownership of the property and identify any liens, easements, or other restrictions on the property.

Inspection: A thorough physical inspection of the property to identify any potential structural issues, necessary repairs, or maintenance concerns.

Financial Review: If you're purchasing an investment property or commercial real estate, this may include reviewing income statements, tenant leases, operating expenses, and other financial details.

Environmental Assessments: This is especially important for commercial properties, where past industrial use may have led to environmental contamination.

Zoning and Land Use Regulations: You'll want to make sure you understand how the property is zoned and what it can legally be used for.

Survey: A survey determines the exact boundaries of the property.

The exact nature of due diligence can vary depending on the type of property and the specific circumstances of the deal. The goal is to identify any potential risks or liabilities and make an informed decision about the transaction.