Due diligence in real estate is thethorough investigation of a home both on a physical and financial level. Proper due diligence also involves research around the area in which the home is located. Home buyers are given an opportunity to do their research during a window known as the due diligence period which we檒l discuss shortly.
People also ask
What does du mean in finance?
Updated June 25, 2019. DU is an abbreviation used for desktop underwriter and desktop underwriting. It is an automated program used by loan originators to qualify a borrower through Fannie Mae guidelines for a conventional loan.
What is a du approval?
It is used by Fannie Mae and, in some cases, the Federal Housing Authority. The program uses Form 1003 plus more than 75 third-party vendors to predict if the borrower will be approved for a loan. In hot real estate markets, having a DU approval in hand can give you an edge in competing for a house.
What does du list on a loan application?
It could disclose a short sale or a foreclosure, which could present issues in getting a loan approved, even if all the terms have been met. The DU will list most revolving creditors, along with the unpaid balances and monthly minimum payments each creditor expects the borrower to pay.
Why would a seller need a du?
Even when a buyer puts down more than 20%, a seller may want a DU to prove they’re reliable. Sometimes a borrower’s credit is so bad that the only way a lender will qualify the buyer is if the buyer puts down a big chunk of change.