Due diligence may sound like a vague term, but it can mean the difference in a smooth, successful real estate transaction and a legal nightmare. Due diligence simply translates to taking reasonable steps to satisfy legal requirements. This term is especially important in transactions and in buying or selling real estate.
3 Key Steps of Due Diligence
The due diligence process takes on increased importance when you’re facing a high-dollar real estate transaction. However, no matter what type of property you’re looking into, you should be taking the right steps for your inspection during the due diligence process. This process can be segmented into three main steps:
- Preliminary due diligence. During this time, you should be looking into all the available public information relating to the property. Through property visits and conversations with your lawyer, you can itemize what you will be looking at later on during your inspection.
- Review of seller documents. Investigating the various documents associated with the sale may be a challenge for some. This requires looking over contracts, bills, environmental conditions, surveys, reports, insurance plans, tax information, and a host of other documents. A thorough investigation of these elements is a necessary part of the due diligence process. With your real estate attorney by your side, you can identify any potential problems and hassles early on.
- Independent investigation. After the more formal investigation, it’s time to take things into your own hands. This is where a real estate lawyer really earns his keep. At the basic level, making sure that the property being shown to you is the one that you are purchasing is obviously important.
Essential Steps for Any Purchase
While having an attorney guide you through due diligence will help you protect your high-dollar transaction and give you the confidence that you’re making a good purchasing decision, there are several steps you can and should look into on any real estate transaction. Some of these include:
- Learning about the property’s history
- Conducting thorough inspections
- Discovering if there are any liens against the property
- Working with an appraiser to determine the property value
- Considering environmental hazards associated with the property
- Looking at insurance options early in the process
- Read the fine print on property warranties
If conducting all of these steps sounds like a daunting or time-consuming task, remember that an attorney can complete many of these for you — and catch red flags that you may not even know to look out for. With 32 years of experience under his belt, Thomas H. Keen can provide you with more information about the due diligence process, and its complexities in Plano, Texas, to ensure that you are preparing correctly for your real estate transaction.
Due Diligence Attorney in Plano, Texas
Thomas H. Keen is a lifelong Texan with extensive litigation experience dealing with a variety of civil issues. He has represented local and national banks, insurance companies, and private and public corporations in the state of Texas for more than 30 years. Thomas holds the highest peer ratings from Martindale-Hubbell in areas including quality and ethics. Whether you’re seeking legal representation concerning real estate, business transactions, probate, or wills and trusts, your case will receive Thomas’ personal attention.