When Should You Tell Your Finance Broker That the Deal Terms Have Changed?
Updated: Oct 24
The finance broker should be assessing the deal that actually exists—not the deal that existed when the first funding conversation took place.
If deal terms changed, finance broker discussions should be updated promptly rather than waiting for the final contract.
Stage 4 is a moving negotiation. Purchase price, settlement payment, vendor finance, timing, borrower structure or conditions can all change the finance view.
Deal terms changed finance broker: the short answer
Tell the broker when a material term changes, not only after the document is signed.
Changes to price, settlement cash, vendor finance, timing, borrower or security can matter.
The earlier funding view may have depended on assumptions that are no longer true.
The broker can then decide whether the lender needs to be updated or the structure reassessed.
Keep the lawyer and finance broker working from the same current term sheet or HOA.
What counts as a deal-term change?
Changes can include the purchase price, amount payable at settlement, deferred consideration, vendor finance, settlement date, finance deadline, entity buying the practice, inclusions or major conditions.
The broker does not need every drafting change, but should know about commercial changes that may affect the funding requirement or lender risk.
Do not wait for the final sale agreement
If a material change is agreed at the heads-of-agreement stage, waiting for the final contract can waste time because the finance work may continue on outdated assumptions.
Price is only one example
A lower price with less vendor finance may require more cash at settlement. A later settlement may provide more time but also alter financial information used by the lender. The effect depends on the whole revised structure.
The broker can triage what actually needs reassessment
Not every change will require a new credit view. The broker's role is to understand the change and determine whether it affects the current finance pathway or lender communication.
For the Stage 3 information pack, see What Information Does a Finance Broker Need to Assess an Accounting Practice Acquisition?
Questions to ask when terms change
What changed from the version previously given to the broker?
Does the amount payable at settlement change?
Does the buyer contribution or security change?
Does the finance deadline or settlement date change?
Has the broker confirmed whether the lender needs an updated submission or approval?
Frequently asked questions
Should I send every draft HOA to the broker?
The broker generally needs the current commercial terms relevant to finance. The exact legal drafting remains a matter for the buyer and lawyer.
What if the change seems favourable?
Favourable changes can still affect the structure. The broker should know the current terms rather than infer them later.
Can the broker update the lender before the contract is final?
Often a funding pathway can be updated as negotiations progress, but the exact lender process depends on the circumstances.
Illustrative Stage 4 scenario
A buyer initially proposes $800,000 at settlement plus $200,000 of deferred consideration. Negotiations later change that to $950,000 at settlement plus $50,000 deferred.
The total price is unchanged, but the settlement funding requirement is not. The finance broker needs the revised terms. This example is illustrative only.
Which adviser covers which issue?
The lawyer manages the legal documents and records the agreed terms. The finance broker keeps the funding assessment aligned with those commercial terms. The buyer should ensure each adviser receives material changes promptly.
What should you look at next?
Once the buyer is keeping finance aligned with the deal, the next Stage 4 question is what document is being used to record the commercial position.
Conclusion
The safest time to tell the finance broker that terms changed is when the change becomes commercially real—not after finance has continued for days or weeks on an outdated version of the deal.
Considering an Accounting Practice Acquisition?
Your acquisition finance adviser can help you keep the proposed deal terms, finance pathway and transaction timing aligned before the acquisition moves further.
General information only. This article does not constitute financial, credit, legal, tax, accounting, compliance or valuation advice. Finance is subject to lender approval, eligibility criteria, terms, fees and conditions. Consider obtaining independent professional advice for your circumstances before acting.
