A Due-Diligence Checklist to Ensure a Smooth Closing

In today's dynamic real estate market, it is more important than ever for buyers and sellers to be prepared and organized for the closing process. The economic uncertainty within the capital markets continues to impact investment activity across the nation. A thorough due diligence process allows buyers to secure financing faster and help all parties avoid future problems.

 While there are sometimes unknowns and unexpected setbacks during the closing process, having the critical information needed can help mitigate any challenges. Below is a due-diligence checklist to allow for a smoother closing.

Due-Diligence Checklist

Financials

• Current rent roll with lease charges, concessions, and delinquency status

• Monthly income and expense statement for the last two years and trailing 12 months

Property

• All current and existing leases

• Schedule of replacements and capital improvements for the last five years

Certificates/Contracts/Licenses

•  Copies of all service and maintenance contracts

• Lead Certificates

• Multifamily dwelling license 

Tax/Legal/Insurance

•  Past two years of real property tax bills

• Loss runs on insurance for the last two years and YTD

• Current insurance policy