What’s a Due Diligence Document—and Why Does It Matter When Selling
or Buying a Home?

July 24, 2025

As a REALTOR®, like in any profession, we know the lingo, but we sometimes forget that not everyone does. If you are involved in buying or selling a Denver area house, you will hear the term Due Diligence Documents come up. It is important to know what the term means and why it matters.

Due Diligence Documents are documents that the seller has in the form of paid invoices for work completed, warranties for appliances or systems staying with the property, past inspection reports or appraisals, building plans, permits, structural reports or basically any documents regarding work completed or related to the home. These documents can be in the form of electronic copies or paper copies.

Why are Due Diligence Documents important? If you are a seller, it is important to let the buyers see all of the Due Diligence Documents that you have, so that you are disclosing everything you have done to the home and any past reports written about the home. The idea is similar to what we say about the Seller’s Property Disclosure—DISCLOSE, DISCLOSE, DISCLOSE! By making the information you have about the house available to the buyer, you are potentially preventing a lawsuit in the future because you are disclosing things upfront and giving the buyer time to process what they read, ask questions and ultimately make a better purchasing decision.
 

If you are a buyer, it is important to read the Due Diligence Documents provided, so you can learn as much as you can about your new home before purchasing it. During the Due Diligence Document timeframe, you can get a deeper picture of the home you will be buying and ask questions. If you find out something you don’t like, you can object and work towards a resolution, and if you can’t come to a resolution, you can terminate the contract, though this is rarely necessary.

Due Diligence Documents are an important aspect of the purchasing process for both buyers and sellers, and they are often overlooked. When the seller takes their obligation to provide these documents to the buyer seriously, it can allow for a smoother transaction by helping the buyer understand what they are purchasing. This can avoid unwanted surprises later in the transaction or even worse, after closing.

As TK Homes agents, we feel it is important to have our sellers disclose everything they know about the home they are selling—surprises in real estate are usually not good, and we also believe that it is our buyers right to know everything the sellers can share with them about the home they are buying. This is why we make sure we take the time to educate our sellers and buyers on the importance of Due Diligence Documents during the selling/buying process. Contact a TK Homes agent today, and we will guide you every step of the way, helping you achieve your real estate goals—whether buying or selling.

~ Written by TK Homes REALTOR®, Mary Smith