Due Diligence
Last Updated: Jun 7, 2019
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Reasonable steps taken by a company in order to satisfy a legal requirement, especially in buying or selling something.
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A comprehensive appraisal of a business undertaken by a prospective buyer, especially to establish its assets and liabilities and evaluate its commercial potential.to determine if the prospective meets the criteria established by the lender to qualify for the proposed loan. Due diligence, in regards to a loan would include collateral appraisals, collateral performance reviews, financial statement analysis, ownership and/or principle officer background checks, and any other steps deemed by the lender as necessary.
The term is also used to describe the steps taken by a lender prior to closing a loan