Brokers trying to go straight to APA?

December 10, 2025

by a searcher from IESE Business School in St. Petersburg, FL, USA

Hey all, curious if anyone has experience with this or insight they can offer. This is now the second time I’ve submitted an LOI and the broker has tried to skip the LOI and move straight to an APA. First deal was $3M and second is $200k. This goes against everything I've read and doesn't logically make sense to me. Why would/how could I sign something binding before verifying anything, even if he claims I can get out of it? Also seems like a waste of money on legal fees. Is this possibly Florida-specific?

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Reply by a searcher
from Pomona College in Asheville, NC, USA

I've seen some sketchy franchise brokers try to do this with nonrefundable deposits. They might make most of their fees on forfeited buyer deposits and seller upfront charges. transworld generally tries to insist on using their own sketchy paper too, although it's not quite as bad on deposit terms. I would just submit your own good normal LOI, CC'ing seller directly or clearly asking broker to forward to seller, and making clear that you won't sign any APA at this stage before due diligence. You're unlikely to ultimately close a deal like this anyway with that kind of counterparty, particularly if they won't consider your own LOI structure.

Reply by a professional
from University of Michigan in Detroit, MI, USA

Hi ^redacted‌, this is an issue with some brokers. Either because (1) they are trying to trap you or (2) they are RE brokers and don't know any better. In general, walk away. You should be signing a purchase agreement before having had time to complete diligence. Run away is purchase agreement also states that you will pay a non-refundable deposit. I hope that helps. Happy to discuss. Reach out at redacted

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