Warning signs after you sign an LOI
The period after selection often reveals how a buyer will use its leverage.
A letter of intent (LOI) is not a closing. It is the point at which a preferred buyer receives access, often with exclusivity, to finish its work.
Most buyers use that period responsibly. Others begin changing the process once competitive pressure has been removed.
Common warning signs include repeated requests for information already provided, new approval requirements that were never disclosed, long periods without decisions, expanding diligence into immaterial areas, and direct contact with employees or customers outside an agreed protocol. Another sign is commercial drift: previously settled terms quietly reappear in legal drafts with more buyer-favorable language.
No single delay proves misconduct. Financing, regulatory review, and complex diligence can create legitimate complications. The pattern matters. A buyer acting constructively identifies the issue, assigns an owner, explains what is needed, and works against a defined timetable. A buyer using delay as leverage leaves requests open, avoids clear answers, and allows the seller’s transaction fatigue to build.
The best protection begins before the LOI. Confirm decision authority, financing assumptions, diligence scope, access rules, drafting responsibility, and a realistic closing schedule. After signing, maintain a written issues list and require each open item to have an owner and next action.
A seller cannot eliminate execution risk, but it can make unproductive behavior visible early enough to respond.