Let’s Talk About LOIs (Letters of Intent)- EP.06

Today we’re talking about LOIs — Letters of Intent. LOIs are kind
of like you and the seller are dating — you’re testing the waters
and have the intent of moving forward with a relationship, but
not the obligation — you’re still shopping. When you sign an LOI
you don’t have inclusivity but it can help you lay out the basic
business terms of the deal and get it moving forward.


This episode we discuss everything we know — and think you should
know — about letters of intent! From the major points of the deal
you should include in the LOI, the bullet points we make on our
LOIs, and some of our real world examples using LOIs.


Key Takeaways:


[:28] What is an LOI? Information on the non-binding, legal
document.


[2:27] The key part to an LOI for us, as buyers. And what’s the
next step after a LOI? 


[4:14] About the inclusivity of a LOI (from the both the real
estate and private equity side), and when exclusivity is reached.


[7:19] So why should you care about a LOI as an investor?


[10:26] The major points of the deal you can include in the LOI.


[11:23] Key terms in the LOI; the price you’re going to pay, how
and when you’re going to pay it, how much is going to be seller
financing, debt, or equity.


[12:02] About the recent deal we got under LOI.


[13:55] The bullet points we make on our LOIs.


[14:38] Exclusivity in a LOI? The binding element we could put in
an LOI.


[15:55] One of our first deals that we put under LOI, signed up
the purchase contract — and the seller still backed out, proving
that contracts are a step towards closing the deal — but they’re
not set in stone.


[18:27] Summarizing LOIs: When you want to see them and when
you’ll use them.


Mentioned in this Episode:


The Alternative Investors EP.05: Don’t Get Bernie Madoff’ed:
Avoid Ponzi Schemes and Fraud


For More on The Alternate Investor, Check Out:


TheAlternativeInvestorShow.com





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