After you submit an offer on a Southern Maryland property and it is accepted, there’s a period of time – usually as long as three weeks – before the deal is finished. During this period, buyers are often advised to do their “due diligence” on the property.
But what does “due diligence” mean? And what should you, the buyer, be doing during this period of time?
In real estate, due diligence means evaluating the property and looking into any issues it may have. A potential buyer should investigate throughout to identify any flaws or issues that could be expensive to fix after the property is purchased.
This is also the time to ensure that the property fully meets the buyers’ expectations. These few weeks before closing are the last chance a buyer has to check the roof for leaks, make sure the basement doesn’t flood – essentially, to make sure they’re not getting ripped off or misled by the seller. If a problem is found, there is still time for the buyer to do something about it before the deal is finalized. A buyer can negotiate with the seller to have the issue fixed or ask to have the price of the property reduced. If the seller will not negotiate, and the buyer was properly advised and has contingencies included in the contract, the buyer can walk away from the home without losing any of their deposit.
Exercising due diligence is an important part of buying a Southern Maryland home. Use this checklist to know which areas you should investigate before closing on a property.
Nearly every home buyer hires a property inspector to thoroughly analyze the home from top to bottom. The inspector looks for leaks in the roof, problems with the foundation, pests, structural issues, electrical concerns, and any other potential problem that could cost a lot of money to fix.
It’s also a good idea to hire a separate professional inspector who specializes in testing for biotoxins like radon, asbestos, mold, and other hazards. Home inspectors generally don’t check for these things, and eradicating them can be expensive.
You should also look into other issues with the local area of the property. Does the property sit on the middle of a flood plain? Is it located within range of another hazardous environmental factor?
Property title search
Before the buyer can take title of the property and become the legal owners of the home and listed in public records, they should conduct a title search to clarify the ownership of the property before proceeding.
A title search now can prevent headaches later. For example, what if the previous owner has an ex-spouse or long-lost relative who turns up claiming ownership of the property? Or, what if there are boundary disputes with the neighbors that are unresolved? Or, perhaps there are unpaid debts, and a creditor has placed a lien on the property. These kinds of problems are stressful and can be expensive to resolve. They can be brought to your attention before closing by hiring a title company to conduct a title search. This lets you approach the seller about any unresolved issues before closing. Leave them unresolved, and they become your problem when you buy the property.
Homeowners’ association or condo rules
If your new Southern Maryland property falls within a homeowners’ association, look into the conditions, restrictions, or declarations of covenants. Review the rules and regulations of the property – and any potential fines that could be incurred for infractions – because some associations have strict rules. Regulations can govern anything from the color of the home to the amount and type of vehicles that can be parked outside.
When you purchase the property, you are agreeing to abide by the rules, so it is a good idea to review them and make sure you are willing to go along with them. If you are not, you can withdraw from the deal and keep looking.
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