Do you include an expiration date in IOIs?

searcher profile

December 15, 2020

by a searcher from Indiana University at Bloomington in Chicago, IL, USA

Two part question:

1) Is it common to include an expiration date in IOIs (FYI - we know to include expiration dates for LOIs)?

2) What are the reasons to or not to include an expiration date in an IOI?

We have an outstanding IOI that does NOT have an expiration date. In this example, we hearing common broker speak on the delay for feedback or closure. Jim Stein Sharpe's article on "Making Offers" is not clear for expiration dates on IOIs and we have not seen an IOI example that includes an expiration date.

We're not sure if we should include an expiration date moving forward to avoid the broker-limbo we're currently in.

Thanks for your insights and feedback.

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commentor profile
Reply by an investor
from Indiana University at Bloomington in Austin, TX, USA
I don't generally write IOIs. It's a waste of time. I go straight to LOI and give the seller 7 days to respond (in some situations, up to 14). If they can't make a decision in that timeframe, it signals they aren't sold on me as a buyer or they're not sure they want to sell. I use it as a filter for where to invest my time. Hope that helps.
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Reply by an investor
from HEC School of Management, Paris in Paris, France
Yes I do. However as Mark writes if seller calls you after the expiration date, you are very free to extend the validity of your offer which by the way remains a Letter of Interest not a binding offer!
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