Due Diligence Checklist

[Erin Anderegg]

Hi all,

I am working to get my first property under contract (currently a SF, the other MF offer wasn't accepted). I want to make sure I am looking at all the right things once the property is under contract to ensure it is still a good deal and to prepare for necessary costs after closing should there be repairs/rehab needed. Here is my current list of things to check. Am I missing anything or looking too in depth at things that don't need to be assessed?

economic data regarding neighborhood - current rent rates for similar sq ft, bed/bath count, location
city certification for rental property
annual taxes
current leases- verified without any undisclosed verbal agreements, concessions, side agreements with any tenant regarding rent, renewal options, security deposits, payment of utilities, or any other aspects of financial terms of lease or rental agreement.
current rent role
expenses- for at least last 12 months - schedule E from federal income tax return.
copy of current insurance policy and loss history
Tenant security deposits on hand- seller verified
copies of entire tenant file for each current tenant
copies of every service agreement or contract
Copies of all required governmental licenses and permits.
list of all personal property included in purchase - equipment, supplies, appliances
copies of latest utility billing - does seller have any deposits on hand at the utility company and do I need to place a deposit for service?
liens for mortgage, income tax, property tax, judgement, other recorded encumbrances on property

property inspection

sewer/plumbing contractor inspection
pest control and property damage inspection
Rehab estimates from contractors
landlord insurance quote
PM quote
lawn/snow maintenance quote

Thanks for your help!

[Andrew Syrios]

That's a good list you got there. I would recommend checking out my long article on the subject: https://www.biggerpockets.com/... Hopefully you'll find it helpful