Purchasing a used home is both exhilarating and frightening. You do not know (at first) how the used home was cared for. That is why you need to perform due diligence. Due diligence is an investigative procedure whereby you fully examine the home before purchasing it. It is extensive, but it is designed to give you peace of mind.
Environmental Factors
Look at the environmental history of the property. What you are trying to determine is how environmentally safe the property is. Find out whether the property has any history of gas leaks, hazardous storage sites or other harmful materials (such as asbestos or lead based paint). To perform this due diligence step thoroughly, hire an environmental consultant. The consultant will have the tools and expertise to provide you with a comprehensive report about the environmental status of your potential new home.
While the consultant should know what to look for, you should focus heavily on whether the land contains wetlands, flooding potential or endangered species. Also, determine whether there is lead-based paint, asbestos, mold, or signs of rot in the home. In addition, perform a title search of the property to determine whether you have mineral, oil or gas rights in the property.
Up to Code
Ensure that the home you are buying complies with all building, zoning and local ordinance laws in your county. Check with the zoning board to find out what the property is zoned as. If it is zoned for one-story, single-family residences, ensure that your home is a one-story home and that you will not be using it as a multiple-family dwelling. In addition, hire a building or home inspector to perform a thorough check of the physical aspects of the property. Ensure that doorways and stairways have been properly maintained. Check the plumbing and the electrical wiring. Inspect the property for damage from pests (such as mice or termites).
Check Your Title
This step goes hand in hand with checking your mineral rights in the property. A title search will tell you whether the seller has the right to transfer title to you and whether any other party will assert greater rights to the property. Title searching can be complicated. Hire a title searcher or a real estate attorney to ensure a thorough check has been performed. If you want to perform a title search on your own, visit the local property records division and ask the clerk to get you started.
