Deposit with LOI?

by a searcher from Harvard University - Harvard Business School

6 years ago

I am dealing with a broker who is pushing for a large deposit (5-10%) to accompany an LOI. This seems unusual to me--in other potential deals I have submitted LOIs with no deposit and then had a 30-day exclusivity period to start working on the major due diligence and start drafting a P&S.
I would love to hear thoughts from others on whether asking for a deposit to accompany an LOI is customary.
Many thanks.

14 likes
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17 comments

searcher

No deposit necessary for sure!

2 months ago | like reply | 0 likes

searcher from Northwestern University - Kellogg School of Management

I have seen it before and I think it's nonsense. For those brokers that require proof of funding, you may want to consider obtaining a support letter from your investor(s).

2 months ago | like reply | 0 likes

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