Buying an existing business can help you hit the ground running? just don?t run yourself into the poor house! Buying an existing business is just as risky as starting a new one. You buy the existing customers but you also buy the problems. Here is a guide to help you avoid financial ruin.Start by asking yourself what you?re interested in doing with your time and money. Also, what is the best match for your skills and experience? If you are interested in a business in which you have no experience, who will provide the expertise while you learn? Assuming you have the experience in that business, there are some basic questions to answer before doing diligence.Why is the business for sale and is it unprofitable?What is the reputation and market share of the business?Are new, large competitors expanding into your market?Is the product or service obsolete? Talk to suppliers, customers and research the history of the business. Contact the Better Business Bureau, industry associations and licensing agencies to identify any hidden problems. Check with state and local tax agencies to check for liens.Finally, what exactly are you buying? Identify the assets, such as inventory, furniture, fixtures, equipment and accounts receivable. How much of the asking price is the “goodwill” of the company?s reputation?If you?re satisfied with your initial review, it?s time to assemble your team.You should have an accountant, attorney and a banker perform the essential “due diligence” function. Due diligence confirms all the facts in regard to the sale. Generally, it refers to the care a buyer should take before entering into a sales agreement. There is no such thing as a “sure thing.” However, if you are not careful and fail to undertake due diligence, you may get stuck with obsolete inventory, bad employees, unexpected liabilities and an inflated sales price.Impatience is not going to help you buy a viable business. Once you sign the purchase and sales agreement, it?s too late. Make sure your team has analyzed all aspects of the business and you fully understand the deal.Do not buy on price alone. Consider the return on your investment (ROI). If you are going to invest $100,000 in a business that historically has 5 percent profit, can you make $5,000 with less risk? You might be better off investing your money into a combination of stocks, bonds or FDIC insured bank certificates. You could earn as much, if not more money, with much less risk.Here are some important parting thoughts. Owners do not sell businesses that are highly profitable and are easy to manage. Most businesses are being sold because they do not or soon will not make money. Many new, prospective business owners have unrealistically high expectations that they can make a business more profitable than the seller. Don?t get caught up in the excitement of the deal. Question your expectations, particularly if you have no experience in that particular business. Do your homework and listen to your team.Peter Colarusso is the manager of the Lynn branch of SCORE, a volunteer organization of business executives who offer free business counseling. The SCORE office is hosted by the Lynn Area Chamber of Commerce, (781) 592-2900.