Are you buying a property in Lagos? There is a need that your property purchase will be smooth, scam-free and stress-free.
The reason is because real estate scams are very common especially in Lagos. Many investors have lost their money to fake land sales and fake promises.
Our law firm recently helped Mr. B successfully purchase a property in Lagos despite the possibility of falling victim to a scam purchase.
And because of this, we’re excited to share the story of how our expertise and comprehensive due diligence ensured a successful transaction despite this scam problems in Lagos.
In this article, you will learn from his story and discover the steps we took to ensure that the purchase was a successful one.
Specifically, we will discuss the following:
- What comprehensive due diligence is
- Case study on Mr. B’s story and how we conducted the comprehensive due diligence
- Lessons Learned from Mr. B’s story
So what is Comprehensive Due Diligence?
Comprehensive due diligence is like doing your homework before making a big decision. It means thoroughly checking and verifying all the facts and information about something before committing to it.
For example, if you’re planning on investing in a business, you wouldn’t just hand over your money without checking if the business is legitimate, if there are any financial risks, and if it has a good reputation, right? That is exactly what comprehensive due diligence is.
Now, comprehensive due diligence when buying real estate is a careful and detailed examination of all aspects of the real estate investment, including:
– Verifying the identity and credentials of the people involved
– Checking for any legal issues or debts
– Assessing the likely risks and pitfalls
– Verifying ownership and legal title
– Identifying potential risks and disputes
– Identifying hidden liabilities and avoiding costly mistakes
– Ensuring compliance with laws and regulations.
Due diligence cuts across different stages of a real estate investment. It includes financial due diligence, physical due diligence, and legal due diligence.
In Lagos, comprehensive due diligence is a very important step to be carried out. More often than not, it benefits buyers and investors mostly. It helps investors:
– Get peace of mind and confidence in their decision
– Identify hidden liabilities and avoid costly mistakes
– Ensure compliance with laws and regulations. For example, building approval.
Building approval is like a permit granted by the state government to start building on the property after meeting with all legal and government requirements.
Without comprehensive due diligence, real estate investments can be very risky. You might end up:
– Buying from someone who doesn’t own the property
– Buying a property that is under government acquisition. Government acquisition is when the government needs or uses land or property for a public project, like building a road, hospital, or school.
– Investing in a location that’s not right for what you need. You could buy a property that is meant for residential purposes as a commercial property.
– Purchasing a property with hidden legal problems.
– Buying a property that’s already been sold to someone else
– Investing in a property with ongoing disputes or court cases
And many other legal issues.
Also Read: Master Real Estate Due Diligence: Why A Simple Registry Search Won’t Protect Your Investment
Case Study of Mr. B
When Mr. B approached us, he informed us of his interest in a property in Lagos and requested our services to help verify the authenticity of the property.
We then asked him to provide us with all the necessary documents and information he had gathered about the property. Our team then conducted comprehensive due diligence on the property.
What We Did as a Law Firm
In Mr. B’s case, we conducted comprehensive due diligence on the property, which included:
- Review of Documents:
We read and reviewed the documents provided to us by the seller to begin the comprehensive due diligence.
2. Tracing of root of title:
We traced the property’s ownership history back to two people, and then to the original land-owning families who sold to the two people in order to verify the seller’s claim to the property.
This means we checked how the seller became the owner of the property.
3. Verifying the title of past owners:
We conducted search at the Lands Registry to confirm that each past owner had the right to sell the property.
The lands registry is a government public place where information about land transactions and property ownership are stored.
4. CAC Search:
We found that the seller is a company. So we conducted a search at the Corporate Affairs Commission (CAC) to verify the company’s existence.
The Corporate Affairs Commission is the government agency saddled with the responsibility of the management of all companies in Nigeria.
5. Confirm location of property:
We engaged the services of a surveyor to confirm location of the property to ensure that the location provided in the survey plan matched the actual location.
What We Discovered As a Law Firm
From our reviews, we discovered the following:
- Root of title:
We found that the seller(company) has a good root of title confirming their ownership. We were able to trace the root of title to the original land-owning family who sold to the two people who then sold to the seller(company).
2. Proper Documentation
We discovered that the seller(company) had all the legal documentation to prove ownership of the property they were about to sell to our client together with other plots they owned. These documents included the survey plan and the deeds of assignment.
3. Free from government acquisition:
We conducted search at the lands registry to confirm that the property was free from government acquisition.
We discovered that the property is free from government acquisition.
4. Location Match:
From the survey report of our surveyor, we discovered that the property’s location did tally with the location stated in the survey plan attached to the company’s documents.
Mr. B was interested in buying a portion of an entire property belonging to the seller(company).
The Due Diligence Search Report
Our due diligence search report advised Mr. B to proceed with the purchase.
After the purchase, we then reviewed the deed of assignment drafted in his name. We also insisted that the deed of assignment included all the necessary clauses that would effectively transfer the ownership of the portion he bought to him and also protect him from any legal issues that may arise from the company’s(seller) property ownership in the future.
A deed of assignment is a document that transfers legal ownership of a property from one person to another.
Our legal guidance helped ensure that the transaction was successful, and that Mr. B could enjoy his new property with peace of mind.
In his words,
“Great service. I engaged their services to conduct due diligence and prepare documentation for a piece of land I wanted to purchase. They provided detailed reports and recommendations, reviewed all documents provided by the seller and guided me all through the process. I’d definitely recommend for anyone looking to purchase property. You’ll surely have peace of mind”
Consequences of Not Conducting Comprehensive Due Diligence
If Mr. B had not engaged our services to conduct comprehensive due diligence on the property, he would not have enjoyed the first hand legal advice which was to make sure there were clauses stated in the deed of assignment that would protect him from any legal issue that may arise in the future regarding the property. One of these clauses is the indemnity clause.
Indemnity clause is a legal protection that ensures the seller compensates the buyer of any loss or damages as a result of breach or legal issues regarding the property.
Lessons Learned: The Importance of Due Diligence
1. Verify Ownership
Before investing in any property, make sure the seller has the right to sell the property and that there will not be any funny surprises later in the future after the property has been purchased.
2. Check Documentation
Always check, read and review the documents given to you by the seller. This is what you will use to conduct a comprehensive due diligence on the property you intend buying.
3. Research Property History:
Always ensure you do research on the property ownership history. Find out how the seller became the owner of the property they want to sell to you. In Mr. B’s story, we were able to discover the contractual relationship between the two individuals and the seller who sold to Mr. B
4. Inspect the Property
It is not enough to rely on the survey plan given to you by the seller.
Always double check on whatever is stated in the survey plan.
Confirm that the location and coordinates tallies with what is in the survey plan. Thankfully, the location tallied with what was stated in the survey plan and Mr. B could successfully purchase the property because the location was the same.
5. Get legal expertise:
You should engage the services of a reputable law firm specialized in real estate law to conduct comprehensive due diligence.
Also, engage other important professionals needed for a comprehensive due diligence of any property such as a surveyor. It is not in real estate transaction that the case will be like that of Mr. B.
Also Read: How We Saved Mr. A From A ₦30 Million Lagos Real Estate Scam
Our team of legal experts can help you navigate complex real estate transactions and ensure a successful transaction with our expert guidance.
Conclusion
Seeking legal help is crucial to making sure you buy only scam-free properties.
At Charis Legal Practice, we offer our services to sophisticated investors who want to invest a minimum of 30 million naira in real estate investment and want to avoid getting scammed in Lagos real estate.
If you need our team to work with you conduct comprehensive due diligence for your property, you can click HERE to get started.
Comprehensive Due Diligence Service starts from N700,000
This Is How Charis Legal Practice Can Help You!
– Discovering Legal Issues
Benefit from a thorough title (ownership) investigation to identify ownership clashes, rightful property claim, or illegal property claims
– Verifying Property Details
Maximize the expertise of a surveyor confirming the property’s location with the description on documents
– Review Legal Documents
Benefit from meticulously examined seller’s documents permits when it is a building, and other critical paperwork.
– Minimizing risks
Reduce the possibility of costly surprises by identifying any potential challenges upfront.
– Provide Legal Expert Guidance
Get clear explanations on whether the property is safe to purchase or not backed up with our findings.
WHY CHOOSE CHARIS LEGAL PRACTICE?
We are your top Real Estate Law Firm in Lagos Nigeria.
As an investor, it can be disheartening to invest in a bad real estate investment. You can engage our services from anywhere in the world regarding properties in Lagos, Ogun, Oyo, and Osun states. Our virtual legal consultations make it easy for you to get expert advice and guidance in the comfort of your own space.
We have successfully conducted numerous comprehensive due diligence services worth billions of Naira for our clients. Let us handle all of your legal needs with our comprehensive due diligence services package specifically designed for you.
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