Steps In Buying a Business
When buying a business, a Buyer should be familiar with the process to make the transaction a success. Here are 10 easy steps to follow when buying a business.
- After filling out, signing and sending the Buyer Pak to the Broker, the Broker will supply the potential Buyer with the name and location of the business. The Buyer will then visit the business, neither speaking nor discussing anything with anyone in said Business.
- If the Potential Buyer likes the business and/or property, the Broker will arrange a meeting with the Seller to discuss relevant documents such as Tax Returns, bills, etc. The Buyer will accompany the Broker to the meeting.
- If the Buyer wants to go forward with the Purchase and receive tax returns, bills, etc., the Buyer must deposit a small “Good Faith Deposit” to be determined at the time, and kept in a Private Escrow Account. This deposit is fully refundable if the buyer does not want to go further.
- If the Buyer wants to go forward with the Purchase, his Attorney must make up an Agreement of Sale. The Agreement of Sale will detail the terms and contingencies of a purchase. In addition to the first “Good Faith Deposit”, a second deposit is required, bringing the total for both deposits to ten percent (10%) of the purchase price of the property. All deposits will be held in one Private Escrow Account, which will be used toward the final Purchase of the Business.
- If the Terms written in the Agreement of Sale are agreeable to Buyer and Seller, the Buyer and Seller will sign the Agreement of Sale.
- Once the Agreement of Sale is signed by both parties, the Business and/or Property are “taken off the market.”
- If, after the Seller fulfills the contingency obligations as stated in the Agreement of Sale, and if, after the Buyer cancels or chooses not to move forward with the purchase, the Buyer forfeits the ten percent (10%)
- When the sale moves forward, a “Closing Document” will be drawn and agreed too by all parties. A “Closing Date” will be set.
- At Closing, the Buyer will pay the Seller the amount stated in the Closing Document. This payment will be made by bank check or certified check
- As stated in the Listing Agreement, the Broker’s Commission will be paid in full at the closing by Bank Certified Check or Bank Check by the Seller.
