The Basics of Real Estate Due Diligence — From the Title to Closing
You find a real estate property you like, you sign it, you wrap up the deal under LOI, sign the purchase agreement, and then you get into diligence — which is what we’re going to be talking about on today’s show.
Diligence is that 30-60 day period after you sign the purchase agreement and before you get into the official closing documents. In this episode, we highlight everything that happens during that period, such as; the title, zoning analysis, building permits, surveying the property, environmental analysis, the appraisal, deeper market research, property condition report, financial due diligence, and the lease review.
This is real estate due diligence 101!
[:13] About today’s episode.
[:48] How long it takes to go through the entire diligence process.
[1:34] Issues that can arise, starting with the title and title insurance.
[5:50] What is zoning analysis? Why is it important?
[6:50] Where are you completing the title, title insurance, zoning analysis, and building permits?
[9:18] About the survey portion of the property and its purpose.
[12:00] What information does the surveyor give you on the property?
[13:53] What is involved in the environmental analysis?
[19:22] All about the appraisal; how much it is, who requires it, and how it can kill deals.
[22:40] Some of the deeper market research that is done to make sure that you’re getting a reasonable value for the property.
[23:45] Can this deeper market research also lead to killing deals?
[24:34] What happens during the property condition report.
[28:04] The process of financial due diligence.
[32:25] All about the lease review.