The Due Diligence Period Explained
When buying a home, there is usually a "due diligence" period, which is a time period when a buyer is able to terminate the contract and get their earnest money back. A contract is binding when both the buyer and seller have agreed to the terms, signed the contract and the complete contract has been delivered to both parties. On that date, the binding date, the due diligence period begins. Before submitting your offer, your agent will work with you to decide how many due diligence days make sense for your situation.
If you are not able to complete the work recommended during this period or you are not able to reach a satisfactory agreement about the issues found during the due diligence period, all parties can mutually agree to extend the due diligence period.
During your due diligence period, you should be prepared to do the following:
Complete a home inspection
Inspect the neighborhood and spend time in the area at different times of day and days of the week
Investigate the surrounding area - are there negative features like prisons or landfills? Are there positive features like local parks and shopping centers?
You can also performing a violent sex offender search at the Georgia Bureau of Investigation website.
It's also a good idea to research local schools, crime rates, and more.
You'll also want to conduct research about the land such as property boundaries, flood plains, power lines, and zoning.
If you are buying a condominium or a home in a neighborhood with on HOA, make sure that you have a firm understanding of the bylaws of the homeowner's or community associations and that you know what the annual or monthly required fees are and what services are included in those fees.
Your real estate agent should walk you through the majority of the items listed above, but you’ll be expected to perform the personal research on your own.
During this period, your agent will also receive a disclosure statement from the seller and while these disclosure statements tend to have good information, you are responsible for verifying the disclosures with a third-party source like a home inspector.
If you have any additional questions about the due diligence period, reach out to your agent. And if you’re looking for an agent who can help you seamlessly navigate this process, call us today at 404-720-2965.