LOI etiquette? Send to seller or broker

by a searcher from Louisiana State University - E. J. Ourso College of Business

5 months ago

We developed some rapport with the seller, talking several times a week, during our light due diligence period. The broker has been CC on everything but has not been directly involved since the early days. 

Do we submit the LOI to the seller or broker in this case?

0 likes
251 views
30 comments

searcher from New York University - Leonard N. Stern School of Business

Given this is likely a smaller business I would not negotiate a break up fee. As others stated you should get exclusivity with milestone to appease the seller but if not then the seller is likely playing the field and time for you to pull back.

1 month ago | like reply | 1 like

intermediary from Boston College - Wallace E. Carroll School of Management

I've been cut out 2x's. Both times, the buyer convinced the seller that it would be more expedient if I were cut out. Both times, I reminded my client that our agreement states I get paid if you close with this buyer whether or not you use my services during diligence (which is the worst part of the process buy far). I've only had 2 deals not close after an LOI was signed. Guess which two?

1 month ago | like reply | 1 like

More on Searchfunder

Just Closed on My First Deal! Reflections and Takeaways for other Searchers

45,152 transactions are available on Searchfunder (now searchable by keyword)

Now everyone has unlimited IBISWorld access

Family office looking for traditional searchers

Examples of self-funded searcher websites

What are market terms for Seller Notes?

2 Best Ways To Find Motivated Sellers, Off-Market Deals

Sorry, but you are a broker's worst nightmare ... and how to fix it

Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.

We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.