Wikipedia: “Due Diligence” is a term used for a number of concepts involving either the performance of an investigation of a business or person, or the performance of an act with a certain standard of care. It can be a legal obligation, but the term will more commonly apply to voluntary investigations. A common example of due diligence in various industries is the process through which a potential acquirer evaluates a target company or its assets for acquisition.”
Can you say with confidence in your business that you practice Due Diligence in all phases of your business? How do YOU define this in your business routine?
Buyers should be prudent and diligent right? There is typically a due diligence clause in most sales contracts. But I just know you can all think of buyers who were far from diligent. However as Realtors you educated them so that they made informed buying decisions.
Due Diligence done the right way takes considerable time and effort and I think many of us just skim over the details from time to time. Not a wise move….huge financial and personal loss could result.
**This concept clearly applies to personal relationships as well**
If you are buying real estate for investment purposes and plan to turn that home over, Due Diligence is critical to success.
But here is an interesting concept….as a Realtor, do you practice Due Diligence on your sellers, buyers and investors? If not you should. You all know there are good and bad buyers out there, those that can take up all of your time, can get you in legal trouble in a number of ways, can even be dangerous to you and your business. In this market you may be tempted to grab onto any buyer you can get your hands on…..and I don't blame you one bit! But perform some D.D. on those buyers and sellers to see what their motivation is and if in doubt, move onto the next….far better to be safe than sorry…don't you agree?
I am sure there are plenty of stories out there where lack of Due Diligence has resulted in some mind boggling and scary stories. Sure would like to hear yours. You can be of great help to others out there.
No matter what your business is, Real Estate or not…keep in mind Due Diligence. Large corporations perform D.D. routinely when they are thinking of acquiring another business and you can best believe this process can take months because the stakes are so high. Well the stakes are high for you too.
So next time that buyer or seller calls you, think about it and conduct a little Due Diligence and feel good about where that relationship is headed. The ultimate goal of course is that long term relationship and you want to feel good about that person being a part of your life for months or in many cases years to come.
You know what they say: An ounce of prevention is worth a pound of cure….
Same thing applies here.
Good luck to all of you and may your D.D. be ongoing and your businesses thrive.