Real Estate Investing Due Diligence Trivia Answers:
1) The invalid step in the due diligence process is #2, as there is no reason to do more due-diligence until you have an accepted offer.
2) The correct answer is #4, as you should consider all in your first step of due diligence, and you could add a couple more if you are investing in rentals outside of your area, including the area’s median income and population trend.
3) The second step of the due diligence process is after your offer is accepted, therefore you should now do the bulk of your due-diligence. The answer is #6, which is all of it! And if you are going to have to rehab the property there is even more due-diligence.
4) You should not go into a deal with the expectation of offering high and then negotiating it lower. One gets a bad reputation for this kind of behavior. You should, however; negotiate if the property proves to be not what you assumed when you made your initial offer, and you find that it is not worth as much as you thought. (2)
5) You know the saying, don’t become emotionally attached to an investment. Decisions on investing should be done with the logical part of your mind, not emotional, nor should you let your ego get involved. Therefore, the answer is #1 – from the very beginning, until the ink is dry on the settlement statement.