Due Diligence And What a Buyer Should Look For

By
Real Estate Agent with RE/MAX 4000

grand junction home

Colorado Real Estate Contracts Contain Provisions For Due Diligence, But What is it?

When Purchasing a Grand Junction Home, There Are a Lot of Responsibilities For The Buyer And Due Diligence is Much More Than a Home Inspection.

When you have an accepted offer for your new Grand Junction home, the clock starts ticking.  Page 2 and 3 of the Colorado Real Estate contract contains a list of action items also known as contingencies and a corresponding date to be completed by and accepted by buyers and sellers.  It is important that every action item on the list with a date next to it be met.  For many of the items, there is a date for it, a date to object to it and a date for a resolution between buyer and seller.

The first action item is a title commitment from the specified title company.  This is usually delivered to the buyers within one week.  The title commitment encompasses these things:

  • Land size
  • Legal description
  • liens if any (taxes, mortgage and personal)
  • Taxes and taxing authorities
  • Right-of-way, easements for utility and government agencies
  • Mineral rights for the property  (some areas this can be a big problem)
  • Water rights are mentioned in some instances
  • County Assessor information on original construction of the home
  • Flood Zone information (if in a flood zone)

A buyer's due diligence is to read the report and make sure the information contained is acceptable first of all.  Are the taxes what you were told they were?  Is the lot the size stated in the home brochure?  All of the information should be reviewed, researched and accepted.  If you find something that is a concern, your real estate agent will complete a form "Amend/Extend" whereby you are objecting to the information.  There will be a corresponding date for a "Resolution" between buyer and seller.

Scheduling the home inspection should take place as soon as possible.  If there are any problems with the property that may be adverse or an issue, you want to know before your order and pay for the appraisal.  The buyer's real estate agent will again prepare the form "Inspection Objection", listing the unsatisfactory items and asking for repair or replacement.  The seller can agree to the repairs, agree to some of the repairs or refuse to do any repairs.  If repairs are made, receipts should be provided to the buyers for their record. Other concerns which should be investigated are mold, radon, asbestos and termites.

If the property has a Homeowner's Association (HOA), it is very important to review the CC&R's.  That stands for declaration of covenants, conditions and restrictions.  This is a list of rules and regulations, possible fines and amount of HOA dues and what services are provided for the dues.  Some HOA's have architectural review committees that control paint colors, fences, RV and boat parking etc.  These are the rules you will have to live by so make sure you know what they are.

Once these tasks are completed and accepted, then focus on your appraisal and financing conditions.  Then you are on your way to being a homeowner!

This post is meant to be a guide and provide information and not intended to be legal advice.

Posted by

Sandra Mathewson

CRS ABR GRI SFR CDPE

RE/MAX 4000 Inc.

call or text (970) 261-1686

I am Sandra Mathewson, a full-time Realtor working both as a listing agent and a buyer's agent. I love using the internet to meet people and keep in touch with friends and clients. I write this blog to show you why Grand Junction, Fruita, Palisade and surrounding real estate is truly something to be desired.

Visit my GrandJunctionHomesGuide.com website if you are considering buying or selling. You will find it as your best online source of information. How is the market doing? I'll keep you posted with the most current MLS reports. You can also search for homes for sale in Grand Junction (including Fruita, Palisade and surrounding areas). Read about the communities, events and things to do in this great Grand Junction, Colorado Lifestyle.

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. JM Padron, CCIM, MRICS 06/14/2016 10:04 PM
Topic:
Home Buying
Location:
Colorado Mesa County Grand Junction
Groups:
RE/MAX Active Rain Bloggers
Posts to Localism
Tags:
grand junction real estate agent
grand junction colorado real estate
grand junction colorado homes
fruita colorado homes
palisade colorado homes
grand junction remax
remax 4000
loma and mack homes for sale

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Ambassador
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Anna Banana Kruchten CRB, CRS 602-380-4886
Phoenix Property Shoppe - Phoenix, AZ
Arizona's Top Banana!

Sandra this is a very thorough list of what home buyers need to be aware of to do their 'Due Diligence' in Grand Junction CO. I find that buyers get the reports that are sent to them but fail to read them if we don't 'hold their hand'!

Jun 14, 2016 07:12 AM #1
Rainmaker
5,305,115
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

This is excellent information to share with prospective home buyers.

Jun 14, 2016 07:13 AM #2
Rainmaker
452,756
Sandra Mathewson
RE/MAX 4000 - Grand Junction, CO
CRS,ABR,SRES,GRI,CDPE RE/MAX

Anna Banana Kruchten   Anna, thank you for stopping by and sharing your thoughts.  You are right, sometimes buyers depend on us too much and need to be a little more pro-active!

Jun 14, 2016 07:18 AM #3
Rainmaker
452,756
Sandra Mathewson
RE/MAX 4000 - Grand Junction, CO
CRS,ABR,SRES,GRI,CDPE RE/MAX

Roy Kelley   Roy, thank you for stopping by, good to hear from you as always!

Jun 14, 2016 07:18 AM #4
Rainmaker
3,098,109
Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Hello Sandra Mathewson,  Excellent blog that buyers should look at and read.  I am amaze how many people do not read them.

Jun 14, 2016 09:40 AM #5
Rainmaker
590,126
JM Padron, CCIM, MRICS
INTERNATIONAL COMMERCIAL ASSOCIATES - San Diego, CA
CCIM, MRICS, Serving Mexico-USA Border

Sandra, I like you post very much. It is true, people tend to oversight important items beyond the regular inspection. Even though it is less comprehensive than in a commercial property, the due diligence should be performed for residential properties accordingly.

Jun 14, 2016 10:04 PM #6
Rainmaker
452,756
Sandra Mathewson
RE/MAX 4000 - Grand Junction, CO
CRS,ABR,SRES,GRI,CDPE RE/MAX

Will Hamm   Will, you are so right most buyers don't read the title report and other documents.  Thanks for stopping by!

 

Jun 16, 2016 12:57 PM #7
Rainmaker
452,756
Sandra Mathewson
RE/MAX 4000 - Grand Junction, CO
CRS,ABR,SRES,GRI,CDPE RE/MAX

JM Padron, CCIM   Jim, thank you for commenting on my blog.  I'm a former native Floridian that moved from Ft. Lauderdale to the great outdoors in 1998.

Jun 16, 2016 12:59 PM #8
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Sandra Mathewson

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