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SeeBen21

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As you perhaps know I’m in the beginning of closing.
Now following questions went through my head.
Do we have to go through the whole licensing process again?
I know we have to apply for a food license even if it’s just renewed.
What’s about the fire code as well as the general license to run a B&B?
Would appreciate your input. Of course we will also push it to our attorney.
 

EmptyNest

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This is something you need to thoroughly discuss with the current owners. It all depends on the town where your potential B & B is located.
Best to contact the Business Licensing division yourself and get it direclty from them. Same for fire codes,
Take nothing for granted. Some properties have clauses in their zoning/ licensing that do not automatically transfer to the next owner.
FInd this out BEFORE you sign on the dotted line.
For us, licensing was not a big deal. We went to the courthouse, checked on the zoning to be sure, went to the office and paid the business licesnse fee to transfer it to our names.
 

Morticia

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Right now and not a minute later, contact the town hall where you are buying and ask THEM about fire codes. You do not want to find out at closing that you have to install a whole new fire system in the building. The fire dept should know all of this, but it also helps to get to know the town clerks, they have the power to stop anything you want to do if they don't like you.
Licensing varies by state and town so ask the town clerk that question as well. Also, if you do not know this from the town clerk already, find out if the place you are buying HAS a license. If they do not, find out what is required to get one. NOW. Not tomorrow. You need to know these things.
When we bought we had to go thru the review process again. Not a problem passing for us, in this town. Also, the health inspector may be showing up, you should read up on the NH government website what they will be looking for. (Sorry, you'll have to find that on the website yourself...)
 

egoodell

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Ben, if it's anything like Charlottesville, you will have to apply for all under your name. I would stongly suggest you visit your zoning dept and tell them you are closing on a B&B and what do they want you to do.
We have some friends that purchased a top B&B here and while the inn was fine, the owners assumed everything would transfer to the new owners and told them not to worry about anything.
NOT!!! They had to run around and get it all done in a hurry and are still dealing with things.
What happens, if an inn has been in business for a while say for 10 years, there are often regulations that change during this time. The inn is already in business and is what is called here "Grandfathered" so they don't have to comply.
But when a new owner comes in, it is like the inn is brand new and the new owners much make sure they are compliant with current regulations.
If you are lucky, the area that you are in are not so much in love with changing regulations like our town is.
Here we are inspected yearly for fire. I don't think you'll have to reinspect if you are up to date.
But PLEASE before you close, visit the office - it could be county, town or city, and find out if there is anything not up to date. It could be costly!
Riki
 

JBloggs

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Here is my warning - first of all you said NH? Was this correct?
We looked in NH and even had earnest money down on a B&B there. With so many B&B's surely they are B&B/business friendly right? WRONG.
One of the reasons we didn't go through with it was we would have to install sprinkler systems throughout the B&B as they were renting out a room on the third floor. The current owners had been "grandfathered in" on many issues, issues we as the new owners would not be.
Parking was another issue, we were not allowed the # of cars they were allowed. Which meant we had to park single file in the driveway. Well that would never work.
We went directly to the local officials and were told different things by diff people. We got to the bottom of it and there were things we could not do and we backed out of the deal.
Do your homework, delve deep and get the answers to every question before closing. DO NOT, I REPEAT AND YES I AM YELLING HERE - DO NOT RELY ON THE CURRENT OWNERS. THEY CAN LIE AND THEY WILL LIE. Many who bought "turnkey" on this forum can tell you of some deceptive dealings.
 

Morticia

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Here is my warning - first of all you said NH? Was this correct?
We looked in NH and even had earnest money down on a B&B there. With so many B&B's surely they are B&B/business friendly right? WRONG.
One of the reasons we didn't go through with it was we would have to install sprinkler systems throughout the B&B as they were renting out a room on the third floor. The current owners had been "grandfathered in" on many issues, issues we as the new owners would not be.
Parking was another issue, we were not allowed the # of cars they were allowed. Which meant we had to park single file in the driveway. Well that would never work.
We went directly to the local officials and were told different things by diff people. We got to the bottom of it and there were things we could not do and we backed out of the deal.
Do your homework, delve deep and get the answers to every question before closing. DO NOT, I REPEAT AND YES I AM YELLING HERE - DO NOT RELY ON THE CURRENT OWNERS. THEY CAN LIE AND THEY WILL LIE. Many who bought "turnkey" on this forum can tell you of some deceptive dealings..
Totally agree with Joe to get the facts from the source, do not rely on the owners, the realtors, the lawyers. Anyone who gives you info, get it in writing. You want to deal only with 'authorized' representatives of the local gov't, zoning, fire dept, etc.
 

seashanty

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i am so excited for you.
please don't be alarmed by what has been posted. but do find out all that you can for yourself. even when one person 'at the town hall' tells you something you then find out it was not exactly so.
new hampshire is wonderful and it has four seasons if you are in the right area!
in maine, i found the easiest regulations to deal with were the local ones but they had their own rules, too. be extremely polite to all your neighbors.
dealing with all agencies, especially inspectors from the state and from the fire department, be extremely polite and show a willingness to learn and do what is required. i was given extra leeway in getting some things corrected within 30 days. the inspector could have simply delayed or withheld my license or permit ... as soon as i had finished what needed doing, i called the inspector to tell him 'it's done' ...
 

EmptyNest

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i am so excited for you.
please don't be alarmed by what has been posted. but do find out all that you can for yourself. even when one person 'at the town hall' tells you something you then find out it was not exactly so.
new hampshire is wonderful and it has four seasons if you are in the right area!
in maine, i found the easiest regulations to deal with were the local ones but they had their own rules, too. be extremely polite to all your neighbors.
dealing with all agencies, especially inspectors from the state and from the fire department, be extremely polite and show a willingness to learn and do what is required. i was given extra leeway in getting some things corrected within 30 days. the inspector could have simply delayed or withheld my license or permit ... as soon as i had finished what needed doing, i called the inspector to tell him 'it's done' ....
He should be alarmed and aware...... Beautiful state or not! We are trying to save him from potential big problems.
He needs to have ALL THE FACTS before proceeding. I suggested just talking to the owners first...just to see what they say. But NOT TO TAKE THEIR WORD FOR ANYTHING!!! Always go directly to the appropriate departments to get the information needed and get it in writing if at all possible.
As he stated, his attorney would take care of all of this...and should. But don't head to closing or put down any money until he knows EXACTLY what is required!!!
 

JBloggs

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Asking this question now is alarming. This is not pocket change, this is a sink or swim deal for most people. Would be a shame to put all the money into it and then have the munipicality say "uh sorry, you can't do this that or the other" No attorney will be able to correct that either.
You can never be too informed. Proactive 110%.
Who would think anything other than we buy an existing B&B and take over an operate it, no aspiring would think of that, those who have been there will. Not every locale is as forgiving as others and let the new owner come in and make corrections to what the prev owners did.
That is the thing in NH, A FEW operate portions of their B&B under the table, so to speak, as they are only allowed 3 rooms say in one area, and so operate the rest illegally. I met more than one innkeeper who rented out their bedroom during peak season and slept on a cot in the basement or attic. If an inn is licensed for 3 guest rooms and actually renting out 6 or 7 I would be very alarmed. You would not know this unless you did some homework.
 

EmptyNest

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Yes I saw your suggestions. They are fine.
But when he is spending big bucks...the ALARM SHOULD GO OFF. I feel real strongly about this at this particular time because I personally know some folks who have been burned very badly and are really having a tough time right now. Unfortunately they didn't think or know who to ask the questions of.
 

seashanty

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i am so excited for you.
please don't be alarmed by what has been posted. but do find out all that you can for yourself. even when one person 'at the town hall' tells you something you then find out it was not exactly so.
new hampshire is wonderful and it has four seasons if you are in the right area!
in maine, i found the easiest regulations to deal with were the local ones but they had their own rules, too. be extremely polite to all your neighbors.
dealing with all agencies, especially inspectors from the state and from the fire department, be extremely polite and show a willingness to learn and do what is required. i was given extra leeway in getting some things corrected within 30 days. the inspector could have simply delayed or withheld my license or permit ... as soon as i had finished what needed doing, i called the inspector to tell him 'it's done' ....
He should be alarmed and aware...... Beautiful state or not! We are trying to save him from potential big problems.
He needs to have ALL THE FACTS before proceeding. I suggested just talking to the owners first...just to see what they say. But NOT TO TAKE THEIR WORD FOR ANYTHING!!! Always go directly to the appropriate departments to get the information needed and get it in writing if at all possible.
As he stated, his attorney would take care of all of this...and should. But don't head to closing or put down any money until he knows EXACTLY what is required!!!
.
i am trying to help also - did you not see that i posted suggestions after saying that New Hampshire is beautiful?
i don't think i have to assume an alarmist attitude to offer constructive ideas.
also, he's talking about closing in november, not tomorrow. he has a real estate attorney and now has to find out the business aspects of operating this as a b&b ...is it at least up to code and not grandfathered in some way?
SeeBen21 .... does your 'real estate attorney' specialize in bed and breakfast transactions?
 

seashanty

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Asking this question now is alarming. This is not pocket change, this is a sink or swim deal for most people. Would be a shame to put all the money into it and then have the munipicality say "uh sorry, you can't do this that or the other" No attorney will be able to correct that either.
You can never be too informed. Proactive 110%.
Who would think anything other than we buy an existing B&B and take over an operate it, no aspiring would think of that, those who have been there will. Not every locale is as forgiving as others and let the new owner come in and make corrections to what the prev owners did.
That is the thing in NH, A FEW operate portions of their B&B under the table, so to speak, as they are only allowed 3 rooms say in one area, and so operate the rest illegally. I met more than one innkeeper who rented out their bedroom during peak season and slept on a cot in the basement or attic. If an inn is licensed for 3 guest rooms and actually renting out 6 or 7 I would be very alarmed. You would not know this unless you did some homework..
Joe Bloggs said:
That is the thing in NH, A FEW operate portions of their B&B under the table, so to speak, as they are only allowed 3 rooms say in one area, and so operate the rest illegally. I met more than one innkeeper who rented out their bedroom during peak season and slept on a cot in the basement or attic. If an inn is licensed for 3 guest rooms and actually renting out 6 or 7 I would be very alarmed. You would not know this unless you did some homework.
not just new hampshire. i encountered lots of places under the radar in maine and stayed at one (didn't know it until i stayed there) in massachusetts.
 

seashanty

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so i have a question ... and seeben i am trying to keep this totally relevant to your purchase.
is there a way to make it a part of the purchase agreement of an existing b&b that if i go to get my license to operate the business, without changing anything, i just want to continue whatever the current owner is doing, if i am denied, then the sale is void?
i have heard of people being told by the town, by the state, 'you will be able to do this or that' and then when they apply for the permit or license they are told 'NO'. and it is not until the application process, when whatever licensing board is in charge reviews it, that a problem is discovered. a general inquiry, with verbal assurance, isn't a permit.
 

Breakfast Diva

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I bought our business turnkey. At the beginning of escrow, I took a trip and stayed at the B&B a few nights. I went to the county courthouse and met with someone in the planning department. They pulled all the paperwork, special variance, etc. I wanted to make sure that all rooms were legal and all necessary paperwork had been filed for the business and hear it from the horses mouth what I needed to do.
Fortunately, everything was fine, the variance was transferable and all rooms were legal. I walked away from there with copies of all the paperwork and permits.
After I went to the courthouse, I went to the local paper and had them pull the last 6 months of issues so I could look at what was happening in the area, both good and bad. My area is small, so the local paper is only published once a week and the library didn't even have past issues.
A big issue for me, was the exclusion list given by the previous owners. Even after the closing and we were the new owners, the old owners kept thinking of things they wanted. You know, the lamp from Aunt Sally, the picture they picked up on their trip to France...etc. One day, a neighbor pulled up with his trailer and said the previous owner just did a swap with him and he's here to pick up a huge propane tank in the back. UHHHH???? Oh no, that's now MY propane tank! Since they lived locally, this kind of nonsense went on for months until I blew my top. I didn't want to make waves, all the neighbors loved them.
GET EVERYTHING IN WRITING. MAKE THE SALE CONTINGENT UPON YOUR BEING ABLE TO HAVE ALL PERMITS AND LICENSES NECESSARY TO RUN THE BUSINESS.
We're not trying to scare you, we're trying to protect you. Especially if your attorney has never dealt with a bed and breakfast before. This is not like most other businesses.
 

SeeBen21

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I bought our business turnkey. At the beginning of escrow, I took a trip and stayed at the B&B a few nights. I went to the county courthouse and met with someone in the planning department. They pulled all the paperwork, special variance, etc. I wanted to make sure that all rooms were legal and all necessary paperwork had been filed for the business and hear it from the horses mouth what I needed to do.
Fortunately, everything was fine, the variance was transferable and all rooms were legal. I walked away from there with copies of all the paperwork and permits.
After I went to the courthouse, I went to the local paper and had them pull the last 6 months of issues so I could look at what was happening in the area, both good and bad. My area is small, so the local paper is only published once a week and the library didn't even have past issues.
A big issue for me, was the exclusion list given by the previous owners. Even after the closing and we were the new owners, the old owners kept thinking of things they wanted. You know, the lamp from Aunt Sally, the picture they picked up on their trip to France...etc. One day, a neighbor pulled up with his trailer and said the previous owner just did a swap with him and he's here to pick up a huge propane tank in the back. UHHHH???? Oh no, that's now MY propane tank! Since they lived locally, this kind of nonsense went on for months until I blew my top. I didn't want to make waves, all the neighbors loved them.
GET EVERYTHING IN WRITING. MAKE THE SALE CONTINGENT UPON YOUR BEING ABLE TO HAVE ALL PERMITS AND LICENSES NECESSARY TO RUN THE BUSINESS.
We're not trying to scare you, we're trying to protect you. Especially if your attorney has never dealt with a bed and breakfast before. This is not like most other businesses..
Thanks for sharing your experience. It’s a good point about the attorney. I will have to ask her if she handled already a B&B case. I know she handles commercial cases but not sure about a B&B.
Until now there is no money in and I will only sign if all questions and issues are solved and clear.
 

SeeBen21

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so i have a question ... and seeben i am trying to keep this totally relevant to your purchase.
is there a way to make it a part of the purchase agreement of an existing b&b that if i go to get my license to operate the business, without changing anything, i just want to continue whatever the current owner is doing, if i am denied, then the sale is void?
i have heard of people being told by the town, by the state, 'you will be able to do this or that' and then when they apply for the permit or license they are told 'NO'. and it is not until the application process, when whatever licensing board is in charge reviews it, that a problem is discovered. a general inquiry, with verbal assurance, isn't a permit..
Good point I was thinking of something like this also regarding the fire system which is in place and seems as far as I researched be sufficient for the current fire code. Anyway e.g. I don’t know when the last service of this system where. I was thinking to put into the contract that the fire systems are serviced, inspected and up to date.
 

SeeBen21

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i am so excited for you.
please don't be alarmed by what has been posted. but do find out all that you can for yourself. even when one person 'at the town hall' tells you something you then find out it was not exactly so.
new hampshire is wonderful and it has four seasons if you are in the right area!
in maine, i found the easiest regulations to deal with were the local ones but they had their own rules, too. be extremely polite to all your neighbors.
dealing with all agencies, especially inspectors from the state and from the fire department, be extremely polite and show a willingness to learn and do what is required. i was given extra leeway in getting some things corrected within 30 days. the inspector could have simply delayed or withheld my license or permit ... as soon as i had finished what needed doing, i called the inspector to tell him 'it's done' ....
He should be alarmed and aware...... Beautiful state or not! We are trying to save him from potential big problems.
He needs to have ALL THE FACTS before proceeding. I suggested just talking to the owners first...just to see what they say. But NOT TO TAKE THEIR WORD FOR ANYTHING!!! Always go directly to the appropriate departments to get the information needed and get it in writing if at all possible.
As he stated, his attorney would take care of all of this...and should. But don't head to closing or put down any money until he knows EXACTLY what is required!!!
.
I’m thankful of all the warnings you give and gave me. This is the reason I’m going into this with a attorney on my side. I’m willing to spend the extra buck in front before I regret it later. Of course I have a whole list with issues connected with the purchase and sales which have to be clarified and solved before I even sign anything or put money down.
 

SeeBen21

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Asking this question now is alarming. This is not pocket change, this is a sink or swim deal for most people. Would be a shame to put all the money into it and then have the munipicality say "uh sorry, you can't do this that or the other" No attorney will be able to correct that either.
You can never be too informed. Proactive 110%.
Who would think anything other than we buy an existing B&B and take over an operate it, no aspiring would think of that, those who have been there will. Not every locale is as forgiving as others and let the new owner come in and make corrections to what the prev owners did.
That is the thing in NH, A FEW operate portions of their B&B under the table, so to speak, as they are only allowed 3 rooms say in one area, and so operate the rest illegally. I met more than one innkeeper who rented out their bedroom during peak season and slept on a cot in the basement or attic. If an inn is licensed for 3 guest rooms and actually renting out 6 or 7 I would be very alarmed. You would not know this unless you did some homework..
I’m sure they are legal (but of course I double check). They have 8 rooms and the fire system is in place. E.g. smoke detectors in each room. Fire doors as well as sprinklers in common area where a fire place is located.
This property was build to be an 8 room B&B right from the start.
 

egoodell

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Asking this question now is alarming. This is not pocket change, this is a sink or swim deal for most people. Would be a shame to put all the money into it and then have the munipicality say "uh sorry, you can't do this that or the other" No attorney will be able to correct that either.
You can never be too informed. Proactive 110%.
Who would think anything other than we buy an existing B&B and take over an operate it, no aspiring would think of that, those who have been there will. Not every locale is as forgiving as others and let the new owner come in and make corrections to what the prev owners did.
That is the thing in NH, A FEW operate portions of their B&B under the table, so to speak, as they are only allowed 3 rooms say in one area, and so operate the rest illegally. I met more than one innkeeper who rented out their bedroom during peak season and slept on a cot in the basement or attic. If an inn is licensed for 3 guest rooms and actually renting out 6 or 7 I would be very alarmed. You would not know this unless you did some homework..
I’m sure they are legal (but of course I double check). They have 8 rooms and the fire system is in place. E.g. smoke detectors in each room. Fire doors as well as sprinklers in common area where a fire place is located.
This property was build to be an 8 room B&B right from the start.
.
SeeBen21 said:
I’m sure they are legal (but of course I double check). They have 8 rooms and the fire system is in place. E.g. smoke detectors in each room. Fire doors as well as sprinklers in common area where a fire place is located.
This property was build to be an 8 room B&B right from the start.
That is great news that it was built as an 8 room B&B. Now you just have to ensure that no codes or regulations have changed since they obtained their license. Try to get it in writing, but here none of the county people will do that. BUT they do answer emails. If you can't get it in writing, ask them questions via email if they have it.
RIki
 

Breakfast Diva

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I bought our business turnkey. At the beginning of escrow, I took a trip and stayed at the B&B a few nights. I went to the county courthouse and met with someone in the planning department. They pulled all the paperwork, special variance, etc. I wanted to make sure that all rooms were legal and all necessary paperwork had been filed for the business and hear it from the horses mouth what I needed to do.
Fortunately, everything was fine, the variance was transferable and all rooms were legal. I walked away from there with copies of all the paperwork and permits.
After I went to the courthouse, I went to the local paper and had them pull the last 6 months of issues so I could look at what was happening in the area, both good and bad. My area is small, so the local paper is only published once a week and the library didn't even have past issues.
A big issue for me, was the exclusion list given by the previous owners. Even after the closing and we were the new owners, the old owners kept thinking of things they wanted. You know, the lamp from Aunt Sally, the picture they picked up on their trip to France...etc. One day, a neighbor pulled up with his trailer and said the previous owner just did a swap with him and he's here to pick up a huge propane tank in the back. UHHHH???? Oh no, that's now MY propane tank! Since they lived locally, this kind of nonsense went on for months until I blew my top. I didn't want to make waves, all the neighbors loved them.
GET EVERYTHING IN WRITING. MAKE THE SALE CONTINGENT UPON YOUR BEING ABLE TO HAVE ALL PERMITS AND LICENSES NECESSARY TO RUN THE BUSINESS.
We're not trying to scare you, we're trying to protect you. Especially if your attorney has never dealt with a bed and breakfast before. This is not like most other businesses..
Thanks for sharing your experience. It’s a good point about the attorney. I will have to ask her if she handled already a B&B case. I know she handles commercial cases but not sure about a B&B.
Until now there is no money in and I will only sign if all questions and issues are solved and clear.
.
We're all excited for you!
 

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