Residential customers usually have month-to-month service agreements (sometimes nothing more than a verbal handshake). Commercial and HOA accounts often have multi-year contracts with assignment clauses that determine whether the contract, and its revenue, actually transfers to you.
Have an attorney in your state review:
- Every multi-year contract. Look for:
, Assignment clauses, does the contract require the customer's written consent to assign to a new owner? Many do. If consent is required, getting it should be a closing condition.
, Termination for change of control, some contracts allow the customer to terminate if the service provider changes ownership. Discount that revenue accordingly.
, Auto-renewal terms, when does it next renew, and what notice is required to prevent renewal?
, Pricing mechanics, fixed price, CPI escalator, or open to renegotiation?
- The seller's non-compete with you. State law varies dramatically, California broadly disfavors non-competes, while Florida and Texas enforce them more readily within limits. Get local counsel.
- Any vehicle leases or financing. Confirm payoff amounts and lien releases at closing.
- IP transfer, brand name, logo, domain, social handles, Google Business Profile, business phone number, customer review history.
- Employee or contractor agreements. If the seller has a tech, are they staying, leaving, or being terminated? What about their non-compete?
- Insurance and bonding, confirm what's required to operate legally in your jurisdiction and what's required by any commercial customer.
- Vendor contracts, supply house terms, software subscriptions, equipment leases.
HOA-specific issues. HOAs often require:
- The contract to be re-bid or re-approved by the board on change of control.
- Specific insurance limits ($1M / $2M general liability is common; some require higher).
- Workers' comp coverage even if you have no W-2 employees.
- Background checks or licensing for anyone on property.
If a single HOA represents >10% of route revenue, treat it as a closing condition: written consent to assignment from the HOA board before close, or escrow that portion of the price subject to consent within 60 days.
Commercial property accounts (apartments, condo complexes, commercial pools). These usually have property management companies in the middle. Confirm the property manager will accept the new owner, and budget for a brief sales presentation in week one.
Vacation rental properties (Airbnb / VRBO). Often higher-revenue but less stable. Verify:
- The property is in good standing (no neighborhood complaints, license issues, or lawsuits).
- Service expectations (some require additional touch-ups between guests).
- Communication preferences with the absentee owner.
A few hundred dollars in legal review prevents a six-figure surprise. This is one of the easiest places to underspend on diligence and one of the most expensive places to be wrong. We are not attorneys, every contract review needs a licensed lawyer in your state.