Under DD
From LOI to closing
Verify what the seller told you, assemble the lender package, and clear the closing conditions.
Verified financials and contracts, an approved loan, a purchase agreement that matches the LOI, and every closing condition cleared. Plan on roughly 60–90 days for a straightforward SBA-financed deal.
- 01
Run diligence in priority order
Start with what kills deals: tax return reconciliation, quality of earnings, customer concentration, and lease assignability. Then work through operations, people, licensing, and legal.
- 02
Send the lender a complete package, early
Personal financial statement, tax returns, résumé, equity documentation, the seller’s financials, the signed LOI, and sources and uses. Incomplete packages are the most avoidable delay. The lender will also order a business valuation; a low appraisal is one of the most common late surprises.
- 03
Keep the purchase agreement and loan documents in sync
Your attorney drafts the purchase agreement while the lender underwrites. Price, asset allocation, seller note terms, and standby agreements have to match exactly across both.
- 04
Close, and fund the escrow
Clear the conditions (life insurance assignment, hazard insurance, UCC lien payoffs, any environmental review), execute the escrow agreement, and plan the working capital true-up.
Watch out for
- Letting exclusivity run out while diligence is still open.
- Underestimating lead time on landlord consent and license transfers.
- Treating the lender’s diligence as a substitute for your own.
Templates for this stage
Free to download with a numanknows account, alongside the deal they’re for.
Lender package checklist (SBA 7(a))
What an SBA lender typically asks for on an acquisition loan: buyer, business, and deal documents.
Asset Purchase Agreement (APA) — Outline
A section-by-section outline of what a definitive asset purchase agreement covers, for discussion with your attorney — not a fill-in-the-blank contract.
See it in a deal
Next: Your first 90 days as owner
This guide is for informational and educational purposes only. It does not constitute legal, tax, financial, investment, or lending advice, and is not a substitute for advice from a qualified attorney, accountant, lender, or other licensed professional.