Real Estate Glossary

What is Letter of Intent?

A letter of intent (LOI) is a document that outlines the general terms and conditions of a proposed agreement or transaction between two parties. In real estate, a letter of intent may be used as a preliminary agreement between a buyer and a seller to indicate that they have reached a basic understanding of the terms and conditions of a potential sale of a property. The LOI may include information such as the purchase price, closing date, and any contingencies that must be met before the sale can be completed. It is important to note that a letter of intent is not legally binding, but it serves as an expression of good faith and a starting point for the negotiation of a formal contract.