What is a buyer's or seller's due diligence regarding disclosures?

• A. Review all disclosures, property condition statements, and any known defects prior to closing; ask questions
• B. Review only after closing
• C. Rely on the seller's word and skip disclosures
• D. Do not review property condition statements

Answer: (A)

Due diligence in disclosures means both buyers and sellers thoroughly review all information about the property's condition before closing, including disclosures, statements of known defects, and any documents describing the property's condition, and then ask questions to clarify anything uncertain. This upfront review helps ensure there are no surprises after the deal, supports a clear understanding of what is truly being bought or sold, and gives the parties a chance to address issues through repairs, credits, or price adjustments. Relying on the seller’s word or skipping disclosures increases the risk of undisclosed problems surfacing later and can lead to disputes or costly fixes. In Colorado practice, carefully reviewing these disclosures before closing is the standard, practical approach to protect both sides and support a smooth transaction.