Real estate is a very high involvement investment. It requires a lot of capital, time and mental resources.
It therefore can hardly be over emphasized the need to make sure your investment is safe.
There are a number of ways to ensure that your investment goes in the right place. This can also be called due diligence or for the slightly more enlightened – DD.
What are the three major points one can check to ensure they don’t squander their hard earned resources.
Today we will be handling due diligence on the seller.
1. Due diligence on the Seller:
Anyone can purport to own a property. In the past where IDs were not standardized, forgeries of IDs was very common with people losing a lot of money to unscrupulous people. However the lands office has improved in this regard by including pictures of the seller and NINs of the owners.
Therefore, before committing to any purchase, ensure the person who claims to be the owner is indeed the owner.
How can you do this?
a). Corroboration: Ask them for more than one ID. A national ID and perhaps a drivers license, passport, work ID, etc.
b). Registered names on their mobile number. You can do this by initiating the process of sending mobile money to their number.
The telephone company will indicate the name that is associated with that number
c). LCs and neighbours: These are usually very critical in matching the ID/person to the face. They can be very helpful especially with landlords who are present and active within the area. However, if someone lives abroad, the neighbours might not know the person well. For example Mukasa Peter might be name to quite a number of people. How do you ensure you are dealing with the right one? Even though NINs will be different, this is a detail that can skip the untrained eye.
d). Bank Account Details: This is a very useful avenue to confirm identity as banks follow equally stringent processes before opening accounts.
Always insist on paying through the bank account where possible.
e). Professionals (lawyers, surveyors, brokers): When all is said and done, you never know when a professional will save you from heartache simply by divulging certain critical information pertaining to a property with regard to a ‘purported’ seller.
This is more common where buyers make part payments.
They are able to get a deposit from party ‘A’ and then from two or more other buyers for the same property.
In this regard, all the other boxes of due diligence are checked; a search at lands will reveal the property is indeed still in the names of the seller.
Their National ID will prove them to be legitimate.
The seller will still have in their possession their original title.
The neighbours and LCs if they haven’t been updated will indeed confirm the seller as the legitimate owner.
The only parties who know that a transaction on the property is underway are probably – you guessed right – the lawyer (on either side), the surveyor who opened boundaries and of course yours truly – the real estate agent.
Which other way can you establish the seller? Let us know.
