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Zoning due diligence has become a necessary process in every real estate investment transaction. Lenders, insurers, and buyers need to minimize their risk and ensure their investment is smart, safe and profitable.
Lenders generally require a property to be in compliance with zoning ordinances before they will issue a loan. In the event that a property becomes legal nonconforming, commonly referred to as “grandfathered,” lenders require a certain damage and reconstruction threshold percentage to again minimize the risk to their investment.
With zoning codes ever-changing, a Zoning Compliance Report provides confidence to the lender and investor that the use of the property will complies with local laws.