Letter of Intent for Land Purchase Template

Letter of Intent for Land Purchase Template

[Buyer Name or Buyer Legal Entity]
[Street Address]
[City, State/Province, ZIP/Postal Code, Country]
Phone: [Buyer Phone Number]
Email: [Buyer Email Address]

[Date]

[Seller Name or Seller Legal Entity]
[Street Address]
[City, State/Province, ZIP/Postal Code, Country]

Re: Letter of Intent for Land Purchase – [Land Address or General Location]

Dear [Seller Name or “Sir/Madam”],

This Letter of Intent (“LOI”) sets forth certain preliminary terms and conditions under which [Buyer Legal Name] (“Buyer”) proposes to purchase from [Seller Legal Name] (“Seller”) the land described below (the “Property”). Except as expressly stated in Section 11 (Binding and Non-Binding Provisions), this LOI is intended as a non-binding outline of key terms and a basis for preparing a formal land purchase and sale agreement (the “Definitive Agreement”).

1. Parties and Property

1.1 Buyer
Buyer Name: [Buyer Legal Name]
Entity Type (if applicable): [Individual / Corporation / LLC / Partnership / Other]
Buyer Address: [Buyer Address]

1.2 Seller
Seller Name: [Seller Legal Name]
Entity Type (if applicable): [Individual / Corporation / LLC / Partnership / Other]
Seller Address: [Seller Address]

1.3 Property (Land Description)
General Location: [Nearest address, road frontage, or area description]
Legal Description (if known): [Legal Description]
Parcel / Lot / Tax ID Numbers (if known): [Parcel Numbers]
Approximate Acreage / Size: [Acres or Square Feet]
Current Zoning (if known): [Zoning Category]
Property Type: [Vacant land / Agricultural / Development site / Subdivision lot / Other]

2. Purchase Price and Payment Terms

2.1 Purchase Price
The total purchase price for the Property is expected to be:

Purchase Price: [Currency and Amount]

2.2 Payment Terms
The Purchase Price is expected to be paid as follows:

• Earnest Money Deposit: [Currency and Amount] (see Section 3).

• Balance of Purchase Price: [Currency and Amount] payable in cleared funds at closing, subject to prorations and adjustments described in the Definitive Agreement.

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3. Earnest Money Deposit

3.1 Deposit and Escrow
Within [Number] business days after execution of the Definitive Agreement, Buyer will deposit the earnest money described above (the “Earnest Money”) with the following escrow agent or title company:

Escrow Agent / Title Company: [Name]
Address: [Address]

3.2 Treatment of Earnest Money
The Earnest Money will be applied to the Purchase Price at closing or disbursed as provided in the Definitive Agreement if the transaction does not close.

4. Intended Use and Feasibility

Buyer’s intended use of the Property is generally described as:

Intended Use: [Example: residential subdivision, commercial development, agricultural use, conservation, personal use, investment hold, etc.]

The Definitive Agreement is expected to give Buyer a feasibility period to confirm that the Property is suitable for the Intended Use, subject to zoning, access, utilities, and other factors.

5. Due Diligence and Inspections

5.1 Due Diligence / Feasibility Period
Buyer will have a due diligence or feasibility period of [Number] days (the “Due Diligence Period”) beginning on the effective date of the Definitive Agreement to inspect the Property and review information.

5.2 Access to Property
During the Due Diligence Period, Seller will provide Buyer and Buyer’s surveyors, engineers, inspectors, appraisers, and advisors with reasonable access to the Property at reasonable times upon prior notice, subject to safety requirements and any existing third-party rights.

5.3 Studies, Surveys, and Reports
During the Due Diligence Period, Buyer may, at Buyer’s expense, obtain or update:

• Boundary survey and topographic survey;

• Soil, geotechnical, or percolation tests;

• Environmental assessments (for example, Phase I environmental report);

• Floodplain, wetlands, and drainage evaluations;

• Utility availability and capacity confirmations;

• Zoning, land-use, and development constraint reviews;

• Access, easement, and right-of-way reviews.

5.4 Seller Information
Within [Number] days after the effective date of the Definitive Agreement, Seller will provide Buyer with available information relating to the Property, such as:

• Prior surveys and plats;

• Title reports or title policies;

• Easements, rights-of-way, covenants, and restrictions;

• Utility maps or correspondence;

• Environmental or soil reports (if any);

• Agricultural leases, grazing agreements, or other use contracts (if any).

6. Contingencies

Buyer’s obligation to close will be subject to customary contingencies, to be fully described in the Definitive Agreement. These are expected to include:

6.1 Inspection and Feasibility Contingency
Buyer’s satisfaction, in Buyer’s discretion, with physical, environmental, and feasibility results obtained during the Due Diligence Period.

6.2 Title and Survey Contingency
Buyer’s approval of title to the Property and any updated survey, including the ability to obtain an owner’s title insurance policy subject only to permitted exceptions.

6.3 Zoning, Land Use, and Approvals Contingency (If Applicable)
Buyer’s satisfaction that:

• Current zoning allows the Intended Use, or

• Buyer can obtain required zoning changes, variances, subdivision approvals, permits, or other governmental approvals within acceptable timeframes, as further specified in the Definitive Agreement.

6.4 Access and Utilities Contingency
Buyer’s confirmation of satisfactory legal and physical access to the Property and the availability or feasibility of utilities (for example, water, sewer or septic, electricity, gas, and telecommunications) to support the Intended Use.

6.5 Financing Contingency (If Applicable)
Buyer’s ability to obtain financing in at least the amount and on terms described in the Definitive Agreement within a specified period.

7. Closing and Closing Costs

7.1 Target Closing Date
Subject to satisfaction or waiver of the contingencies described above, the closing of the purchase and sale (the “Closing”) is expected to occur on or about:

Target Closing Date: [Target Closing Date]

7.2 Location and Method of Closing
Closing may occur at the offices of the Escrow Agent, at a closing attorney’s office, or by mail or electronic exchange of documents, as agreed by Buyer and Seller.

7.3 Closing Costs and Prorations
The parties anticipate that closing costs will be allocated as follows, subject to local practice and the Definitive Agreement:

• Seller to pay: [Items such as transfer taxes, Seller’s share of escrow/attorney fees, broker commissions, release fees for Seller’s liens].

• Buyer to pay: [Items such as Buyer’s share of escrow/attorney fees, recording fees, title insurance premiums, lender costs].

Real estate taxes, assessments, and any land-use charges that can be prorated are expected to be prorated as of the Closing Date.

8. Brokers and Commissions

Buyer is represented by: [Buyer’s Broker / Agent Name or “None”]
Seller is represented by: [Seller’s Broker / Agent Name or “None”]

Responsibility for any brokerage or agent commissions will be addressed in the Definitive Agreement or in separate written agreements with the brokers or agents involved.

9. Confidentiality and Exclusivity

9.1 Confidentiality
Buyer and Seller will keep the terms of this LOI and any non-public information exchanged regarding the Property confidential, except as required by law or as necessary to share with internal decision-makers, lenders, or professional advisors who are subject to confidentiality obligations.

9.2 Exclusivity / No-Shop (Optional)
If the parties agree, the Definitive Agreement or a separate clause may provide that, for a defined period, Seller will not enter into a binding agreement to sell the Property to any other party. Any specific exclusivity terms (scope and duration) should be stated clearly and agreed in writing.

10. Preparation of Definitive Agreement

Buyer or Buyer’s counsel will prepare a draft of the Definitive Agreement reflecting the terms of this LOI, as modified by subsequent negotiations.

Buyer and Seller will use commercially reasonable efforts to negotiate and finalize the Definitive Agreement within [Number] days after this LOI is fully signed, or within another period agreed in writing. The transaction will not be legally binding until the Definitive Agreement is signed by both Buyer and Seller, except for the Binding Provisions described below.

11. Binding and Non-Binding Provisions

11.1 Non-Binding Terms
Except as expressly stated in Section 11.2, this LOI is a statement of current intentions only and does not create a binding obligation to buy or sell the Property, to sign the Definitive Agreement, or to complete the transaction. Either party may discontinue negotiations at any time, subject to the Binding Provisions.

11.2 Binding Provisions
The parties intend that the following provisions will be legally binding once this LOI is signed and delivered by both Buyer and Seller:

• The confidentiality obligations in Section 9.1.

• Any specific exclusivity or “no-shop” terms the parties expressly agree to include.

• The governing law and dispute resolution provisions in Section 12.

• This Section 11.2 itself.

All other provisions of this LOI are non-binding and may be modified, supplemented, or omitted in the Definitive Agreement.

12. Governing Law and Dispute Resolution

This LOI (to the extent of the Binding Provisions) will be governed by and construed in accordance with the laws of:

Governing Law: [State/Province, Country]

Any dispute arising out of the Binding Provisions of this LOI will be resolved in:

Dispute Resolution Forum: [Court or Arbitration Forum and Location]

13. Expiration

If this LOI is not signed by both Buyer and Seller on or before:

Expiration Date: [Expiration Date]

it will expire and have no further effect unless extended or renewed in writing by both parties.

14. Signatures

If the terms of this LOI are acceptable as a basis for preparing the Definitive Agreement, please sign below to indicate your agreement to the Binding Provisions in Sections 9, 11, and 12 and your agreement in principle to the non-binding business terms described above.

Buyer

[Buyer Legal Name]

By: _______________________________
Name: [Authorized Signatory Name]
Title (if applicable): [Title]
Date: [Date]

Seller

[Seller Legal Name]

By: _______________________________
Name: [Authorized Signatory Name]
Title (if applicable): [Title]
Date: [Date]