The BizBuySell Small Business Community

  • Get Expert Advice

  •  • Find Local Service Professionals

  •  • Share Your Experiences

Does a buyer need to pay the seller broker any commission during the sale of a business.

Does a buyer need to pay the seller broker any commission during the sale of a business. Also in which stage of the buying process do I need a Lawyer & Accountant (due diligence would be one) and how much are their estimated fees.

No User Photo

Answer This Question

max 5000 characters

Web Reference (optional)

e.g., "www.mywebsite.com"

Review Community Guidelines

Help keep our Community clean and on topic. The BizBuySell Community is a place where you can discuss your questions, concerns and knowledge with others you can trust. It is not OK to use this forum to solicit others for personal or financial gain, illegal activities, or to rant about personal issues. Please review the full guidelines if you have any questions.

Submit Your Answer
Answers (3)
Mrs. Elizabeth White
Washington County, FL

A MUST READ: HOW I GOT MY LOAN FROM THIS GREAT COMPANY CALLED DR. MAVERICK LEONIDAS LOAN COMPANY

Hello to All across the globe, I am Mrs. Elizabeth White, from United State Of America, USA. I am a mother of 4 kids and I was stuck in a financial situation and I needed to refinance and pay my bills. I tried seeking loans from various loan firms both private and corporate but never with success, and most banks declined my credit ,do not fall prey to those hoodlums at there that call them self money lender they are all scam , all they want is your money and you will not hear from them again they have done it to me twice before I meet Dr. Maverick Leonidas the most interesting part of it is that my loan was transfer to me within 74hours so I will advice you to contact Dr. Maverick Leonidas if you are interested in getting loan and you are sure you can pay him back on time you can contact him via email……… (dr.maverickleonidassloans@gmail.com) No credit check, no co signer with just 2% interest rate and better repayment plans and schedule if you must contact any firm with reference to securing a loan without collateral then contact Dr. Maverick Leonidas today for your loan

They offer all kind of categories of loan they

Short term loan (1_10years)
Long term loan (20_30 years)
They offer loan like
Home loan............., Business loan........ Debt consolidation loan .......
Student loan..........,Business start up loan
Business loan....... , Company loan..............Mortgages loan
construction loan.....car loan........ hotel loan....personal loans.. etc

Email..........(dr.maverickleonidassloans@gmail.com)
When it comes to financial crisis and you need to be free from financial crisis then Dr. Maverick Leonidas loan loan is the place to go please just tell him I Mrs Elizabeth White direct you Good Luck....

Aug 31, 2017
Satish Patel
Sunbelt Business Advisors
Middlesex County, MA
Premium Broker

Jas,
Good question. There is no one answer since it depends state to state and what type of broker you’re working with. In New England for example there is buyer broker representation but 90% of the time the broker fee is paid by the seller. Even if a business brokers work together and “co-broke” often times they are being paid by the seller’s broker and work as a sub agent to the seller’s broker.
Please call my office at 617-945-5338 or mandoni@sunbeltne.com to discuss this further.

Thank you
Mariola Andoni, CBI
Sunbelt Business Sales & Acquisitions
www.sunbeltne.com

Aug 5, 2009
No User Photo
The BAF Group LLC
MD

In most cases, the Seller contracts with the Broker to represent him/her (let's say "him", for brevity's sake,) and all commissions are paid by the Seller. In that case, please keep in mind that, no matter how friendly the Broker is, he is NOT your friend and he is NOT representing your best interests. He works for the Seller, and ONLY for the Seller.

However, if you want your own Broker - someone that is working on your behalf to look out for your interests - you may be required to pay YOUR Broker, for any services rendered to you. In Residential Real Estate, Brokers split commissions with other Brokers and Agents; that is not the case with most Business Brokers. We do quite a bit of business as Buyer's Brokers, and in most cases, the Buyer must pay our fees. How much and when they are paid is negotiated with each Broker.

When you need an Accountant is before you are ready to make an offer. You need to know what the business is worth, how much you will be expected to pay in Debt Service (regardless of how your finance the deal,) and what the Net would be once you take it over. You cannot make an offer until you have a darned good idea of the numbers.

When to get an Attorney involved is a little scarier. In the majority of our deals, the Buyer provides a Letter of Intent (LOI), and the Attorneys become involved when that is accepted by the Seller. Many Attorneys will insist you need to have a Lawyer write the LOI, and they are not necessarily wrong! If the LOI is correctly and fairly done, there is really no liability for you to be concerned about. On the other hand, there are some Brokers that will provide you with a "template" LOI that binds you into the deal in such a way that any deposit is forfeit, if you back out of the deal, no matter what. This is a rare, but very real concern.

Our LOI template was put together by an Attorney, and its sole purpose is to see if the Buyer and Seller can agree on basic price and terms, before incurring any legal costs and entering into a Contract of Sale. In more than ten (10) years of working in this field, we have only had two (2) Buyers lose their deposits, and interestingly enough, both of them occured when they had Attorneys write their LOIs. THIS IS NOT TO CRITICIZE ATTORNEYS! All it says is that there are SOME risks, no matter how you strike the deal, and your best means of protection is to be aware of all of your risks, and make certain you understand all of the issues at hand. You are the only person that can really safeguard yourself.

Jul 27, 2009