Ask Ron – Stephen A.

9 Responses to Ask Ron – Stephen A.

1. Jeff Clayton says:

   May 14, 2012 at 1:25 am

   Ron is so right. Due diligence money is hard costs…it’s gone even if you terminate the contract and get your earnest money back.

   Engineers, inspectors, Environmental Phase I, all have their hand out and have to be paid whether you close or not.

   Also beware commercial lenders who charge upfront fees. Ask me how I know this. Lost $9,800 a few years ago to a so called commercial lender.

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2. James Noullet says:

   July 16, 2012 at 9:09 pm

   Thanks Ron

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3. John Rogers says:

   August 31, 2012 at 6:36 pm

   So for commercial properties you can get your deposit back if you back out of the deal. However, you are at risk of losing the money you spend to check-out the property, the due dilegence money you spend to ensure it is a doable deal.

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4. Cresencio Mandujano says:

   September 8, 2012 at 3:58 am

   Thanks Ron

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5. LaTanya Graves says:

   November 8, 2012 at 1:50 am

   Very true for both residential and commercial deals—due diligence costs are not refundable…i.e. – inspection, appraisal, etc if performed!

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6. Stanley Chambers says:

   April 24, 2013 at 10:19 pm

   Great lesson, thanks!

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7. Bryan Davis says:

   November 27, 2014 at 5:00 am

   Due diligence is a factor to be considered any time you’re going deeper into a deal than a straight wholesale.

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8. Christian Moore says:

   December 9, 2015 at 11:15 am

   Wow. I never knew there was so much cost in the commercial realm. Thank you!

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9. Trevor Morgan says:

   August 22, 2017 at 12:09 pm

   There isn’t necessarily ‘so much cost’ in the commercial property arena, because every property is different. It is more expensive up front for many of the reports and a commercial appraisal is more expensive than a residential – but the costs going in (exclusive of the earnest money which you get back if you pull the deal) – are balanced by the higher profits/equity/cash flow for the overall deal. It’s all relative.

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