What do you ask for due diligence?

2 Replies

If you were to buy a small multifamily (fourplex)

What is ok to ask the seller?

Should I ask for leases? Utilities bills? What else?

Thank you

@Mary Jay Yes to everything. I ask for leases and bank statements to show that rental amounts in he lease are the amounts being deposited. This also lets you see when they are deposited so you can determine if the current owner is receiving payments on time or potentially chasing rent each month. I also ask for all utility bills to ensure I can accuractly calculate my expenses. Also review the sellers disclosure. The beat advise I can give on a small multi is to try and meet the tenants. Hopefully during a walkthrough you can see what you will be inheriting. Tenants will usually hold nothing back. I always ask them, “tell me everything you would want me to replace”. This question has allowed me to avoid huge “hidden” issues with properties that very clever sellers have tried to conseal. Good luck
Originally posted by @Mike Dorneman :
@Mary Jay Yes to everything. I ask for leases and bank statements to show that rental amounts in he lease are the amounts being deposited. This also lets you see when they are deposited so you can determine if the current owner is receiving payments on time or potentially chasing rent each month. I also ask for all utility bills to ensure I can accuractly calculate my expenses. Also review the sellers disclosure. The beat advise I can give on a small multi is to try and meet the tenants. Hopefully during a walkthrough you can see what you will be inheriting. Tenants will usually hold nothing back. I always ask them, “tell me everything you would want me to replace”. This question has allowed me to avoid huge “hidden” issues with properties that very clever sellers have tried to conseal. Good luck

 Thats great advice! Thank you so much!