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Archive for 'Buyers Beware!' Category

SBA Lender “Bait and Switch” : A Nasty Practice

By Hoke - Last updated: Tuesday, October 27, 2015

The SBA guarantees 75% of a Business Acquisition Loan. If the Buyer can make a 25% Cash Down Payment, in the event of a default, the Lender can collect the entire loan balance from SBA. It has no risk of cash loss. As written, the SBA program is wonderful and very helpful. However, Lenders have […]

Some Brokers Make Money by NOT Selling Anything: A Nightmare Tale…

By Hoke - Last updated: Wednesday, November 19, 2014

I all starts very innocently with wording in the broker’s Representation Agreement “in the event of an escrow default by buyer, the escrow proceeds are split equally between broker and seller”. This is how the nightmare begins… Think about this. Now the broker now makes five times more money (50%) in the event of an […]

Broker Pressure Tactic: “There are Other Buyers Interested!”

By Hoke - Last updated: Sunday, February 9, 2014

Use of ” There are Other Buyers Interested!” is a grossly overused broker tactic. Some brokers say this with an air of great urgency to every buyer as a knee jerk reaction. Sellers often encourage brokers to use this tactic. We discourage use of this tactic when no other buyers exist. First of all, how […]

Good Faith Deposit / Beware of Broker Trust Accounts

By Hoke - Last updated: Friday, January 3, 2014

A Good Faith deposit is often required to accompany the offer. The amount is typically 10% to 20% of the sale price. Because it is impossible to really really know if the sellers claims are valid without solid verification, most reputable business brokers will hold the Good Faith Deposit uncashed until Due Diligence is successfully […]

Beware the Inept Business Broker

By Hoke - Last updated: Friday, July 27, 2012

I recently sat in a disaster of a closing meeting as a paid consultant (not as Broker). The purpose of this meeting was for the buyer, seller and landlord to sign a Lease Assignment and close the deal. Unfortunately, the broker who was to provide the Lease Assignment never showed this complicated three page lawyer […]