Due Diligence Do’s & Do Not’s – No Standard Yet
I received a call the other night from a colleague with some questions on an offer they just received; it was concerning the new due diligence process. Here in the North Carolina Raleigh-Cary area due diligence (in a nut shell) involves the set amount of time a buyer has to do the home inspection, appraisal, title search, pest, radon and/or lead paint inspections, survey, mortgage approval, etc., in this time frame they have to decide if they want to buy the home or not. Now the sellers are compensated for this Due Diligance time frame with a Due Diligence Fee that is non-refundable should the buyers decide the home is not for them.
If you’re not yet familiar with the Due Diligence process take a look an earlier blog series that explains in detail and talks about What’s new in NC Offer to Purchase Contract.
We all know well… buyer beware, but Due Diligence is put in place to protect the buyer (without forfeiting their Earnest Money) should unforseen problems arise pertaining to major home components. Before 5 PM of the Due Diligence date a buyer can walk away from a purchase contract for any reason OR NO REASON AT ALL. PERIOD.
Feedback from a few of our recent sellers I wanted to share:
The Due Diligence period = Sellers Beware.
As we all know, one of the major roles of Realtors® in most home buying and selling transactions is to be the calm in the storm. As Realtors® who have had a decent amount of experience navigating our clients through this new Due Diligence process… I’d like to share some of the tips I’ve learned along the way.
Part 1 of 3 in our Due Diligence Series: Realtors®
Realtors® TO-DO LIST:
- Educate your buyers and sellers about how the due diligence process works. Help your clients understand the pros, cons, caveats and expectations regarding foreseeable situations.
- Explain how the Due Diligence money is different than the Earnest Money, understanding the role of each allotted amount.
- (Buyers Agents) Consider Time Management – get any and all items on the due diligence home check list completed during the Due Diligence period, without asking for an extension.
- (Listing Agent) Keep your clients in the loop throughout the process – they are eager to hear from you.
- Use your experience to guide your clients through… taking their personal levels of comfort into consideration.
REALTORS® DON’T LIST –
- DON’T ignore any of the DO items above.
For more visit:
Part 2: Due Diligence for Home Sellers
Part 3: Due Diligence for Home Buyers
Do you have any Due Diligence Do’s & Don’ts to add?