Essay about Business Of Real Estate, Due Diligence

753 Words Jun 6th, 2016 4 Pages
After successfully submitting an offer on a property and having it accepted, there is a stage, usually up to three weeks, before the deal is closed. During the wait before the deal is closed, buyers are often advised to do their ‘due diligence’ on the property they have placed the offer. But what does ‘due diligence’ mean? And what should the potential buyer be doing during this period of time?
In business of real estate, due diligence basically means evaluating and looking into any issues the property may have. The potential buyer should investigate the property thoroughly to identify any flaws or issues that may cost significant amounts of cash to fix after the property has changed hands. The buyer should use their due diligence to ensure that the property fully meets their expectations of what they hope to receive after parting with their cash. The few weeks before closing are the last opportunity a buyer has to check the roof for leaks, ensure the basement doesn’t flood – and in the main make sure that they are not getting ripped off or mislead by the seller. If a buyer does find issues or flaws, they still have time to do something about it. They can negotiate with the seller to have the problems resolved or reduce the price of the property. If the seller is unwilling to negotiate, and as long as the buyer was properly advised and has contingencies included in the contract, the buyer can cancel the deal and walk away from the property without losing any of their…

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