From Accepted Offer to Closing
When you accept an offer, you typically sign a Letter of Intent, then move through due diligence, financing, a definitive purchase agreement, and escrow before closing, usually 60 to 120 days. The accepted offer sets the price and framework; the work that follows verifies the business, secures the buyer's financing, and formalizes the deal. Understanding these stages helps you keep the deal on track.
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1. The Letter of Intent (LOI)
Most accepted offers are documented in a Letter of Intent — a largely non-binding document setting out the price, structure, key terms, and an exclusivity period during which you stop marketing the business while the buyer completes diligence. The LOI aligns both sides before anyone spends heavily on legal work and diligence. It's the framework the rest of the deal is built on.
2. Due Diligence
The buyer then conducts due diligence — verifying your financials, legal standing, and operations. You'll provide documents and answer questions over roughly 30 to 60 days. This is the most scrutiny-intensive phase; keeping your documentation organized and your business performing well is key. Findings can lead to confirmation of the deal or renegotiation.
3. Financing
If the buyer is using an SBA or bank loan, financing proceeds in parallel — the lender underwrites the deal and orders a business valuation. This often drives the timeline. A seller note (seller financing) may be part of the structure. The deal is contingent on the buyer securing financing, so this phase matters to whether you close.
4. The Purchase Agreement
As diligence progresses, attorneys draft the definitive purchase agreement — the binding contract that replaces the LOI, detailing price, terms, representations and warranties, allocation, the non-compete, transition, and contingencies. This is negotiated in detail; it's where the deal becomes legally firm. Both sides' attorneys are central here.
5. Escrow and Closing
Finally, the deal moves through escrow — funds and documents are coordinated, required clearances and notices are handled, the lease is assigned, and at closing, ownership transfers and you get paid. Then comes the transition. The stretch from accepted offer to closing is where deals are won or lost, so staying engaged, responsive, and running the business well throughout is essential. See the full selling process.
Frequently Asked Questions
What happens after you accept an offer on a business?
You typically sign a Letter of Intent, then move through due diligence (the buyer verifying your business), financing (if the buyer is using a loan), a definitive purchase agreement drafted by attorneys, and escrow, before closing and getting paid. The process from accepted offer to closing usually takes 60 to 120 days.
How long does it take to close after accepting an offer?
Usually 60 to 120 days. Due diligence takes about 30 to 60 days and buyer financing (such as an SBA loan) about 60 to 90 days, and these overlap. The exact timeline depends on the deal's complexity, the buyer's financing, and how smoothly diligence and escrow proceed.
Is a Letter of Intent binding?
Mostly not. An LOI is largely non-binding on the core deal terms, it sets out the price, structure, and framework, but usually includes some binding provisions like exclusivity (you stop marketing the business) and confidentiality. The binding contract is the definitive purchase agreement drafted later.
Can a deal still fall through after I accept an offer?
Yes. Deals can fall through during due diligence (if problems surface), financing (if the buyer can't secure a loan or the valuation comes in low), or purchase-agreement negotiation. That's why keeping the business performing well, staying responsive, and working with experienced advisors matters through closing.
Got an Offer, or Hoping To?
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