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Tip 39 – Settlement – No Retentions

If your lawyer is suggesting a retention to help a settlement across the line that usually means the contracts prepared by that lawyer could be better. If a buyer is requesting a retention, that usually means the buyer doesn’t trust you.  Unless the retention is a significant amount of money you’ll usually burn more in legal fees setting up the retention than it is worth.  If you have to offer or require a retention then make as much of it as automatic as possible; ie amounts, conditions for payment and the sunset date.