Seller Will Not Release Financials Without Personal Financial Statement from Buyer
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Question:
I am looking at a business being sold directly by the seller. I have asked to see her financials but she won't release them to me unless I provide her with my personal financial statement. What should I do? I definitely have the money to make this purchase with some seller financing but I am really concerned about giving her this information because it is so confidential.
Answer:
While I understand your concerns about confidentiality, aren't you really asking the seller to do the same thing for you? The seller is not being unreasonable. After all, she wants to be certain that you have the financial strength the complete the transaction. The only way for her to determine this is by viewing your financials just as you have requested for the business.
If you will feel more comfortable, you can always have your attorney draft a simple reciprocal confidentiality agreement that basically provides for you and the seller to have adequate protection with one another for all of the information that you exchange. This way, both parties will be bound to the same agreement.
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Richard Parker author of: How To Buy A Good Business At A Great Price(TM), the most widely used reference resource and strategy guide for buying a business. He has purchased ten businesses in his career and has helped thousands of prospective buyers worldwide learn how to buy the right business for sale. He is also founder and President of Diomo Corporation - The Business Buyer Resource Center. Richard Parker is also the author of BizQuest's Business for Sale Blog |