Broker is suggesting that I skip the LOI?

September 20, 2025

by a searcher from Washington State University in Vancouver, WA, USA

I’m currently evaluating a business listed by a broker, and the broker is suggesting that I skip the traditional LOI step and instead put in an “offer with contingencies.” Has anyone here encountered a situation where the broker pushed for an offer instead of an LOI? • What should I watch out for? • Are there risks in going this route compared to a standard LOI? • Could this create issues around exclusivity, leverage, or negotiating room later? Would love to hear any experiences or advice from folks who’ve been through this before.

Reply by a searcher
from The University of Michigan in Seattle, WA, USA

My two cents, LOIs are essentially non-binding offer with contingencies. Not sure why the broker is getting bogged down with the title of the document. between LOI and final offer you do your due diligence. Whatever you call the document do not skip due diligence. I’d call it offer with contingencies and make the document look exactly the same to what you would’ve had in your LOI anyway, and perhaps have an updated version post diligence Not sure what I’m missing here but that’s what I would do Hope it helps

Reply by a searcher
from The University of Chicago in Nashville, TN, USA

Do they mean that they want you to go straight to a purchase agreement? If not, it seems like semantics, an LOI is an offer with contingencies. If they are looking for a purchase agreement I would push back, it is a waste of everyone's time if you don't have a framework in place.

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