Due Diligence is a Lot More than a Home Inspection

The Due Diligence in your purchase contract is more than just a home inspection! You need to verify, confirm and sign off that you are OK with every aspect of the home you intend to buy. Here are some more important items that should be included in your due diligence as a home buyer. 

Verify & Obtain Historical Water Usage

Verifying water usage is very important. While a good home inspector makes every effort to detect an underground water leak in the course of a home inspection (i.e., checking water meter for movement,) they do not have the ability to spot underground water leaks because this is a visual service as defined by NAC 645D, an underground leak may be detected by excessive water usage.

You can call your water provider to verify water usage and historical use by going to their website or calling them.

Review Homeowner’s Association (AKA CIC or HOA) Documentation

After the seller sends a written request to the HOA, in Nevada, that HOA has 10 days to deliver the documents, and the prospective purchaser has 5 days to review and approve those documents. If a prospective purchaser disapproves the documents, they have the right to cancel the purchase contract, not ask for changes. 

Verify School Zoning

If schools are important to you, utilize the school’s online zoning tools to verify school zoning. Do not rely solely on what the listing agent stated. For Clark County Nevada schools, go here: https://www.ccsd.net/schools/zoning/ For other areas, ask Google.

Verify Value with an Appraisal

You will want to verify the value of the home:

a)     an independent CMA (Comparative Market Analysis) that can be done by your real estate agent (me)

b)    a licensed appraiser (even if you are paying with cash). Try not to rely on online valuation sites as they are notoriously unreliable sources. They gather date but can’t actually visit the house being valued. A trained human brain and eyeballs is your best source for valuation!

Check for Kitec Re-Plumb

If the home you are buying was built in between 1996 through 2006, Kitec may be an issue. A good inspector does their best to look for signs of defective Kitec plumbing. If they find signs, or even if you are just curious, you may check to see if the home had a Kitec re-plumb as part of the class action lawsuit:


If built with Kitec and not replumbed, you will want to ensure you are getting enough of a discount to make it worth having the replumb done professionally after you buy it.

Review Title Report

You will receive a Preliminary Title report from the Title agency that you selected on your contract. Review the Title report for any inconsistencies, liens, encumbrances or red flags. These documents can be a little confusing, so ask your Title Officer if you have any questions. Title and Escrow Officers are often the same people in the Las Vegas market. Make sure you return the information sheet promptly to your Escrow Officer when you receive it. 

Verify Building Permits

Many property owners (especially flippers) do not hire licensed contractors so you will really want to verify permits issued (or the lack of) if extensive work was done to the home you are purchasing!

Here are your resources for verifying permits:

City of Las Vegas: https://www.lasvegasnevada.gov/Business/Permits-Licenses/Building-Permits/Permit-Application-Status

Clark County: https://citizenaccess.clarkcountynv.gov/citizenaccess/Cap/CapHome.aspx?module=Building&TabName=Building

City of Henderson: https://eportalprod.cityofhenderson.com/ePortalProd/Permit/Search

City of North Las Vegas: http://www.cityofnorthlasvegas.com/departments/ldcs/building_safety.php  

Review Seller’s Real Property Disclosure (SRPD) & Any Other Disclosures

Sellers are required, by law, to disclose property defects. This includes, but is not limited to “non-traditional” sellers: investors, flippers, bank owned entities, etc. There are very few exclusions to this law.

It is important to remember SRPD’s convey with the property and run with title, so this should be a comprehensive disclosure of the property’s history.

Check Crime Statistics

Crime Mapping – https://www.crimemapping.com/ – is an excellent tool. You can plug the address of the home you are purchasing into the website and set yourself up for alerts to be sent directly to your email. Just make sure that you put your current address in the map as well for comparison. There is probably more crime in your own neighborhood than you think, and I wouldn’t want you to walk away from a great property because it looks like they have a lot of crime, when in fact, it may have less crime than your current neighborhood.

Verify Zoning

Verify Zoning with your local zoning office. There is always a lot of new construction in the Las Vegas valley and you will want to make sure that all land zoned around you is acceptable to your needs.

Order a C.L.U.E. Report

A C.L.U.E. report is also known as “Comprehensive Loss Underwriting Exchange”. You may obtain this report from your home insurance providers. Some insurers will provide it for free and some will charge a nominal fee.

You do not want to go through all of this due diligence process to find out in the end that the home you are purchasing is uninsurable due to a large claim in the past.   

Research & Order Your Home Warranty

Having a home warranty can save you from spending a lot of money on replacing water heaters, appliances, and many other systems in your home. I have Dwellness Home warranty. They are local and have their own techs and I think they are great! Many HW companies are terrible, so if you have had terrible experiences in the past, ask me about Dwellness.

Check for Airplane Noise

Is the home you’re buying directly under a common flight path? And if it is, does that bother you when you’re inside?

Review and Turn Around Documentation to Your Lender Promptly

If you are working with a Lender, make sure you turn around paperwork quickly to avoid last minute closing delays. Also, do not make any large credit purchases (like a car) because this could throw off your ratios. Do not open any new lines of credit and believe it or not, don’t close any existing lines of credit… that can cause you issues too.

Obtain Historical Electrical & Natural Gas or Propane Usage

Call the electric and gas providers to check historical usage specific to the house you are purchasing.

Review Nevada Sex Offender Registry

The Nevada Sex Offender Registry is located online: http://www.nvsexoffenders.gov/ Keep in mind that the Las Vegas area is very transient, and people move around often.

Review the Nevada Residential Disclosure Guide (RDG)

Order Uncommon Inspections That Are Specific to the House & Important to You

a)  Lead based paint is hazardous to young children who ingest paint chips. Lead-based paint was outlawed a long time ago and it is extremely difficult to test for paint as it is generally under several layers of paint. There is a good chance that if the home was built prior to 1977 that it does have lead-based paint. You can buy lead-based paint test kits at Home Depot or any hardware store, and if you are really concerned about it, you can hire a professional to do the testing. If there aren’t going to be any young children in the home, it may not be important to you (unless you are prone to eating paint chips).

b)  If the home has a septic system, definitely get the septic professionally inspected.

c) Well or Public Water Quality: Nevada Division of Environmental Protection is a resource to get well water quality testing done: https://ndep.nv.gov/water/lab-certification/drinking-water-testing.  You may also check the SNWA website for additional guidance: https://www.snwa.com/water-quality/treatment-testing/index.html

d) Mold: If moisture or suspicious biological growth was found during your home inspection you may want to find a qualified and experienced mold inspector.

e) Pest: Scorpions, black Widows, pigeons and roof rats are just a few of the common pests in the Las Vegas Valley. You may want to hire a pest inspector that is licensed by the State of Nevada Department of Agriculture. http://agri.nv.gov/Pest-Control/    

Verify Repairs Were Done Correctly

If you have requested the seller to do repairs prior to close, make sure you verify that the repairs are done before you close. Also obtain receipts for those repairs, licensed Nevada contractors must provide a statutory warranty for work done. 

Final Walk Through & Release

A Final-Walk Through & Release is vital at the conclusion of your escrow period. Mechanical, electrical and plumbing systems will fail from time to time during an escrow. I highly encourage all of my clients to do their own walk-through Inspection and test all systems to make sure they are running correctly. I have a checklist for you to complete this walk-through in a thorough manner!

Do you have a need for commercial/industrial/retail buildings or land? Are you ready to buy or sell a home? Do you want a guaranteed cash offer? We can help you with all of that… just call us at 702 SELL NOW or click on this link to my website http://www.702SellNow.com

Choose to have an amazing day….Jeff

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