How do I verify a concrete company’s equipment is not tied to another loan?

Concrete companies carry a lot of costly equipment, and much of it is financed. Begin with a list of mixers, pumps, loaders and plant with serial numbers and vehicle identification numbers. Next to each, note whether it is owned, financed or leased, and with whom. Ask the seller to confirm that list in writing.

Then ask for the paperwork: loan agreements, lease contracts and recent statements. Compare them with the list and with the loans on the balance sheet. A machine that the seller calls fully owned but that shows payments leaving the bank account deserves a question.

Searches come next. Your lawyer can run the checks that reveal whether a lender has registered a claim against the equipment, and can tell you how to deal with each one. Plan for payoffs: the purchase agreement should say which loans are paid from the sale price and that each lender will release its claim. Ask your lender what they will want for security, because a loan you take may require the same equipment as collateral. An appraiser can help with condition and fair value. Remember that sellers sometimes forget older arrangements. Ask them to sign a short written statement listing every loan and lease that touches the business, so surprises later are clearly the seller’s to explain.

Key takeaways

• Build a serial-numbered equipment list and mark owned, financed or leased.
• Have your lawyer search for claims and plan the payoff at closing.
• Match loan papers to the debts shown in the financial statements.