Real estate due diligence checklist: title, inspections, disclosures and seller files

The due diligence period is the window in a purchase contract during which the buyer may inspect the property and, under many contracts, walk away. Its length, and whether the earnest money comes back, are set by your contract and state practice, so read those clauses first.

This checklist covers homes, condos and small rentals. It follows the order in which things usually come due: contract dates first, then title and survey, then inspections and disclosures, then insurance and the loan papers.

Larger income property needs a heavier file, with estoppels, operating history and an environmental report. The commercial real estate version covers that.

Many hands produce the file. The title company issues the title commitment and copies of the recorded exceptions. A licensed surveyor prepares the survey, inspectors write the inspection reports, and the seller fills in the property disclosure form. The HOA or its manager supplies association records, and your lender sends the loan papers.

1. Diary every contract date the day you sign: inspection deadline, financing and appraisal contingencies, closing.
2. Order inspections in the first days, because repair talks need the reports.
3. Ask the title company for the commitment and every exception document listed on it.
4. Send the seller the request email below for disclosures, HOA files and, on a rental, the lease file.
5. Check the flood map and get insurance quotes before the inspection window closes.
6. Read the Closing Disclosure against your Loan Estimate as soon as it arrives.

• Reading the title commitment without pulling the easements and covenants it lists as exceptions.
• Skipping a survey, then finding a fence or garage over the line.
• Letting the inspection deadline pass while repair quotes are still pending.
• Taking the seller’s word on rents without seeing the signed leases and deposit records.
• Getting an insurance quote only after closing, when a flood zone has already raised the cost.

A title commitment is the title company’s offer to insure, listing the conditions it needs met and the exceptions it will not cover. Exceptions often include easements, covenants and old liens, so ask for a copy of each recorded document.

Compare the commitment with a survey. A boundary survey shows where buildings, fences and driveways sit against the lot lines and setbacks. Your lender may require a specific type.

• Legal description on the commitment matches the contract.
• Every lien listed has a payoff or release planned before closing.
• Easements do not run under the house or the spot where you plan to build.
• Covenants and HOA rules allow your intended use, for example a home office or a rental.

Order the general inspection first, then add specialists for what it flags. The table shows the usual set and when each one applies.

A seller disclosure form is the seller’s written account of known defects, on a form most states prescribe, so its content varies by state. Read it next to the inspection report and ask about anything the two do not agree on.

For most housing built before 1978, federal rules add a lead paint step. The seller must share known information and records on lead-based paint and give you the EPA lead hazard pamphlet (EPA, Real Estate Disclosures about Potential Lead Hazards). You also get a 10-day chance to inspect, which the parties can change in writing or you can waive (EPA, Real Estate Disclosures about Potential Lead Hazards).

In a condo or HOA community, ask for the governing documents, the budget, the reserve study, recent minutes and any special assessment. These tell you what the association may charge you next.

When you buy a home with tenants, the leases come with it. Ask for proof of every number the listing quotes, such as rents and deposits.

1. A rent roll: unit, tenant, rent, lease dates and deposit held.
2. Every signed lease agreement and amendment.
3. A ledger of security deposits, so the right amounts transfer at closing.
4. Tenant estoppel letters confirming rent, deposit and lease terms, where tenants will sign them.
5. Operating statements, utility bills and property tax bills for the period the seller owned it.
6. Service contracts, such as landscaping, pest control or laundry.

Look up the address on FEMA’s Flood Map Service Center, the official source of flood maps, which lenders use to set insurance requirements (FEMA, Flood Maps). A high-risk zone can mean required flood insurance, so get a quote early.

The last check is on the loan. Your lender must give you the Closing Disclosure at least three business days before closing (CFPB, What is a Closing Disclosure?). Use that time to compare it line by line with the Loan Estimate and ask about any change.

• EPA, Real Estate Disclosures about Potential Lead Hazards: Before a buyer signs a contract for most housing built before 1978, sellers must disclose known lead-based paint and hazards, give the records and the pamphlet, and provide a 10-day inspection opportunity that the parties may change in writing or the buyer may waive.
• EPA, Health Risk of Radon: EPA’s radon risk chart says to fix a home at 4 pCi/L and to consider fixing between 2 and 4 pCi/L.
• FEMA, Flood Maps: The FEMA Flood Map Service Center is the official source of flood hazard maps under the National Flood Insurance Program, and flood maps help mortgage lenders set insurance requirements.
• CFPB, What is a Closing Disclosure?: The lender must give the borrower the Closing Disclosure at least three business days before closing, to compare final terms and costs with the Loan Estimate.
• EPA, Brownfields All Appropriate Inquiries: AAI evaluates a property’s environmental conditions; the AAI rule at 40 CFR Part 312 recognizes ASTM E1527-21 as consistent with it; innocent landowners, contiguous owners and bona fide prospective purchasers must conduct AAI before acquiring and meet continuing obligations after.