Tips

Real estate transactions: Common sense tips for success
By: Ruth J. Mitchell

Whether you are representing a client in a real estate transaction, or buying your first house, the Internet is one of the best real estate due diligence research tools available. Taking advantage of the Internet’s research tools early in a transaction can provide you with accurate, reliable, up-to-date information available on a property or its owner.

Having information about a property and its owner will help you foresee and prevent problems. As a young lawyer, don’t wait for a due-diligence period to begin to start taking advantage of the abundant resources online.            

1.  Google Earth is your friend. Make a habit of looking up each property on Google Earth early in a transaction. Google Earth provides a “boots on the ground” property perspective, and information about neighboring properties. However, be sure to check the date of the image!

Remember, the purpose of due diligence is to verify and validate. Use Google Earth to further your understanding of the transaction as a whole and verify basic information. Double check that there is not a landfill, toxic dump, or similar establishment that might impact the property that is subject to the transaction or its intended use. If Google Earth displays property with improvements, but your client is purchasing a vacant lot, it is time to start asking questions.

2.  County appraisal or tax assessor records. Information for almost all properties is available online at the appropriate county appraisal or tax assessor website. For example, the Dallas Central Appraisal District provides valuable owner, tax, and property information free online. Accessing county appraisal information allows verification of owner and property information and may provide critical property insights.

3.  Official public records. Many official county records are available online free or at nominal cost. County property records contain chain of title information. Additionally, the previous deed conveying ownership is generally available for preview or purchase. Analyzing the previous deed provides valuable property owner information, previous conveyance terms, as well as notice of exceptions to title that may impact a current transaction.

4.  Texas Comptroller of Public Accounts, Taxable Entity Search. The Texas Comptroller’s “Taxable Entity Search” provides information on Texas businesses and foreign entities doing business in Texas. Spending a few minutes researching business entities involved in a transaction might prevent closing delays or the need for an amendment extending closing if an entity has forfeited its existence or is not in good standing.  

5.  Internet search of parties and property. Conduct a basic Internet search to gain information on the property, transaction parties, opposing counsel, etc. Make sure the proper business entity is listed on a contract.

Helpful Google search tips can be found here.

Because business is conducted all over the United States, it is not usually practical or possible to physically visit transaction properties. Conducting an initial Internet search of a property and transaction parties upfront can provide you with information and perspective that can lower stress later in the process. Even if your search reveals improvements on what is supposed to be a vacant lot, being empowered with such knowledge earlier in the process will allow all parties to get on the same page sooner and prevent last-minute scrambling and confusion. So long as a matter is timely discovered, generally, contract amendments can be executed for almost any circumstance.

Remember, initial due diligence on transactions involving real property should include (i) viewing a property on Google Earth, (ii) researching owner and tax information on county appraisal district or tax assessor sites, and (iii) perusing appropriate county records.

Ruth J. Mitchell practices real estate and business law at Scheef & Stone, L.L.P. in Dallas.  She can be reached by email at ruth.mitchell@solidcounsel.com.