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Letter of Intent to Sell Property Template: Price & Key Terms

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Letter of Intent to Sell Property Template

[Seller Name or Seller Legal Entity]

[Street Address]

[City, State/Province, ZIP/Postal Code, Country]

Phone: [Seller Phone Number]

Email: [Seller Email Address]

[Date]

[Prospective Buyer Name or Buyer Legal Entity]

[Street Address]

[City, State/Province, ZIP/Postal Code, Country]

Re: Letter of Intent to Sell Property – [Property Address or Description]

Dear [Buyer Contact Name or “Sir/Madam”],

This Letter of Intent (“LOI”) sets forth certain preliminary terms and conditions under which [Seller Legal Name] (“Seller”) is prepared to sell to [Buyer Legal Name] (“Buyer”) the property described below (the “Property”). Except as expressly stated in Section 10 (Binding and Non-Binding Provisions), this LOI is intended as a non-binding outline of key terms and a basis for preparing a formal purchase and sale agreement (the “Definitive Agreement”).

1. Parties and Property

1.1 Seller

Seller Name: [Seller Legal Name]

Entity Type (if applicable): [Individual / Corporation / LLC / Other]

Seller Address: [Seller Address]

1.2 Proposed Buyer

Buyer Name: [Buyer Legal Name]

Entity Type (if applicable): [Individual / Corporation / LLC / Other]

Buyer Address: [Buyer Address]

1.3 Property

Street Address: [Property Street Address]

City, State/Province, ZIP/Postal Code, Country: [City, State/Province, ZIP/Postal Code, Country]

Legal Description (if known): [Legal Description]

Property Type: [Residential / Commercial / Land / Mixed-Use / Other]

2. Proposed Purchase Price and Payment Terms

2.1 Proposed Purchase Price

Seller is prepared, subject to negotiation and execution of the Definitive Agreement, to sell the Property for approximately:

Proposed 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], to be deposited in escrow as described in Section 3.

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

Earnest Money Deposit: [Currency and Amount], to be deposited in escrow as described in Section 3.

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

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:

Escrow Agent / Title Company: [Name of Escrow Agent or Title Company]

Address: [Escrow Agent or Title Company Address]

3.2 Treatment of Earnest Money

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

4. Buyer Financing and Capacity

Buyer has indicated that the Purchase Price will be funded as follows:

Loan Amount (if applicable): [Currency and Amount or Percentage of Purchase Price]

Cash / Equity Amount: [Currency and Amount or Percentage of Purchase Price]

Any financing contingency, if agreed, will be detailed in the Definitive Agreement, including deadlines for obtaining loan approval.

5. Due Diligence and Inspections

5.1 Due Diligence Period

Subject to the terms of the Definitive Agreement, Buyer will have a due diligence 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 inspectors, appraisers, surveyors, engineers, and advisors with reasonable access to the Property at reasonable times upon prior notice, subject to occupant rights and safety requirements.

5.3 Documents and Information

Within [Number] days after the effective date of the Definitive Agreement, Seller will provide Buyer, to the extent available, with copies of:

  • Current title report or policy;

  • Existing survey or site plan;

  • Leases and rent rolls (if income-producing);

  • Service and maintenance contracts;

  • Recent real estate tax bills and assessments;

  • Operating statements (for commercial property);

  • Existing environmental or structural reports (if any).

Current title report or policy;

Existing survey or site plan;

Leases and rent rolls (if income-producing);

Service and maintenance contracts;

Recent real estate tax bills and assessments;

Operating statements (for commercial property);

Existing environmental or structural reports (if any).

6. Contingencies

Buyer’s obligation to close will be subject to customary contingencies described more fully in the Definitive Agreement, which may include:

  • Buyer’s satisfaction with physical inspections of the Property;

  • Buyer’s approval of title and any survey;

  • Buyer’s satisfaction with environmental conditions (if applicable);

  • Buyer’s ability to obtain financing (if a financing contingency is agreed);

  • Buyer’s review and approval of existing leases and income information (for income-producing property).

Buyer’s satisfaction with physical inspections of the Property;

Buyer’s approval of title and any survey;

Buyer’s satisfaction with environmental conditions (if applicable);

Buyer’s ability to obtain financing (if a financing contingency is agreed);

Buyer’s review and approval of existing leases and income information (for income-producing property).

7. Closing and Possession

7.1 Target Closing Date

Subject to satisfaction or waiver of the contingencies, closing of the 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 the parties.

7.3 Possession

Seller anticipates delivering possession of the Property to Buyer on:

Possession Date: [Same as Closing Date / Other Date]

Condition at Possession: [Vacant and broom-clean / Subject to existing leases / As described in Definitive Agreement]

8. Closing Costs, Taxes, and Prorations

The parties expect that closing costs will be allocated substantially as follows (subject to local custom and the Definitive Agreement):

  • Seller to pay: [Transfer taxes, Seller’s share of escrow/attorney fees, broker commissions, other Seller costs].

  • Buyer to pay: [Recording fees, Buyer’s share of escrow/attorney fees, title policy premiums as applicable, lender fees].

Seller to pay: [Transfer taxes, Seller’s share of escrow/attorney fees, broker commissions, other Seller costs].

Buyer to pay: [Recording fees, Buyer’s share of escrow/attorney fees, title policy premiums as applicable, lender fees].

Real estate taxes, rents, association dues, and utilities are expected to be prorated as of the Closing Date according to the Definitive Agreement.

9. Brokers and Confidentiality

9.1 Brokers

Seller is represented by: [Seller’s Broker or “None”]

Buyer is represented by: [Buyer’s Broker or “None”]

Responsibility for any broker or agent commissions will be addressed in the Definitive Agreement or in separate brokerage agreements.

9.2 Confidentiality

Buyer and Seller agree to 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.

10. Binding and Non-Binding Provisions

10.1 Non-Binding Terms

Except as expressly stated in Section 10.2, this LOI is intended as a non-binding expression of Seller’s willingness to negotiate and does not create a legal obligation for either party to buy or sell the Property, to enter into the Definitive Agreement, or to complete the transaction. Either party may discontinue negotiations at any time, subject to the Binding Provisions.

10.2 Binding Provisions

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

  • The confidentiality obligations in Section 9.2.

  • Any exclusivity or “no-shop” terms expressly agreed in this Section 10.2.

  • The governing law and dispute resolution provisions in Section 11.

  • This Section 10.2 itself.

The confidentiality obligations in Section 9.2.

Any exclusivity or “no-shop” terms expressly agreed in this Section 10.2.

The governing law and dispute resolution provisions in Section 11.

This Section 10.2 itself.

[Optional Exclusivity: “For a period of [Number] days from the date of Buyer’s signature below (the ‘Exclusivity Period’), Seller will not enter into a binding agreement to sell the Property to any other party.”]

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

11. Governing Law and Dispute Resolution

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]

12. Expiration

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

Expiration Date: [Expiration Date]

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

13. Signatures

If the general 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, 10, and 11 and your agreement in principle to the non-binding business terms described above.

Seller

[Seller Legal Name]

By: _______________________________

Name: [Authorized Signatory Name]

Title (if applicable): [Title]

Date: [Date]

Buyer

[Buyer Legal Name]

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Letter of Intent to Sell Property Template: Price & Key Terms

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Frequently asked · Real estate, pre-contract terms

Letter of Intent to Sell Property · Non-binding outline, binding traps, Statute of Frauds

Eight questions to settle before you sign a letter of intent to sell property. An LOI frames price, deposit, contingencies, and timing before anyone pays a lawyer to draft the purchase agreement — but a carelessly worded LOI can bind you to a sale you never meant to commit to. Below the FAQ: sample clauses for each part of the LOI (property description, price, deposit, contingencies, the binding/non-binding clause, and the timeline to a definitive agreement) you can adapt.

Residential · Commercial · Land · Mixed-use Binding vs non-binding language guide Statute of Frauds · state variance flagged Reviewed July 2026
01 Basics

What is a letter of intent to sell property?

A letter of intent to sell property (real-estate LOI) is a short document in which a property owner sets out the main terms on which they are willing to sell — price, deposit, contingencies, and timing — before anyone drafts a formal purchase and sale agreement. It records where the parties stand in principle.

The LOI does three jobs. It puts the seller's headline terms on paper so both sides negotiate from the same starting point. It signals genuine intent to transact, which is often what a serious buyer or lender wants to see before committing time and money to due diligence. And it frames the deal so the lawyers who later draft the definitive purchase agreement know what they are papering. An LOI is a bridge between a handshake and a signed contract — deliberately lighter than the contract itself, but not without legal risk.

02 Compare

How is an LOI different from a purchase and sale agreement?

An LOI outlines proposed terms and is usually mostly non-binding; a purchase and sale agreement (the "definitive agreement") is the binding contract that actually obligates the parties to close. One frames the deal; the other executes it.

  • Purpose. The LOI captures the business terms in principle. The purchase agreement contains the full, negotiated legal rights and obligations of buyer and seller.
  • Binding effect. Most of an LOI is a non-binding expression of willingness to negotiate; a purchase agreement is binding on signing and creates enforceable obligations to close (subject to its contingencies).
  • Detail. An LOI is typically 2-6 pages of headline terms. A purchase agreement runs many pages with warranties, remedies, closing mechanics, prorations, and default provisions.
  • Sequence. The LOI usually comes first; the definitive agreement is drafted and negotiated afterward, then signed, then the deal closes.
03 Binding?

Is a real-estate letter of intent legally binding?

Usually the sale itself is non-binding, but specific provisions (such as confidentiality and a short exclusivity or "no-shop" period) are commonly written to be binding — and, importantly, an LOI can become unintentionally binding on the whole sale depending on its wording. This is the single most litigated feature of LOIs.

US courts in many states will enforce an LOI as a contract when two things are present: the letter contains the essential terms of the deal (parties, property, price), and the parties manifested an intent to be bound rather than merely an "agreement to agree." Where a letter sets out definite terms and reads as a present agreement, some courts have found a binding contract despite the parties assuming the LOI was just a formality. Conversely, courts generally uphold a clear, explicit statement that the LOI is non-binding. The safest LOI states plainly which provisions bind and which do not, and calls the sale itself non-binding until a definitive agreement is signed. This is general information; enforceability turns on state law and the exact wording — have an attorney check it.

04 What to include

What should a letter of intent to sell property include?

Eight elements. Leave one out and the LOI either fails to frame the deal or, worse, reads as vague enough to invite a dispute about what was actually agreed.

  1. Parties. Legal names of seller and proposed buyer, entity type where applicable, and addresses.
  2. Property description. Street address, and the legal description where known, so the property is identifiable without oral testimony.
  3. Proposed purchase price. The headline number, expressed as a proposal subject to the definitive agreement.
  4. Deposit / earnest money. Amount, when it is due, and the escrow agent or title company that will hold it.
  5. Contingencies. Due diligence, inspection, title, financing, and environmental conditions the buyer's obligation to close will depend on.
  6. Timeline. Due diligence period, target closing date, possession date, and a deadline to sign the definitive agreement.
  7. Binding / non-binding clause. An explicit statement of which sections bind (usually confidentiality, exclusivity, governing law) and that the rest — including the sale — does not.
  8. Expiration and signatures. A date the LOI lapses if unsigned, plus signature blocks for both parties.
05 Why use one

Why use a letter of intent instead of going straight to the contract?

Because framing the terms first is cheaper, faster, and lower-risk than negotiating a full purchase agreement blind. The LOI surfaces deal-breakers before either side spends money on lawyers and due diligence.

  • Cost. Drafting and negotiating a definitive agreement is expensive. An LOI tests whether price and structure are even close before that spend starts.
  • Alignment. Writing the headline terms down exposes hidden disagreements (deposit size, closing date, what stays with the property) while they are still cheap to resolve.
  • Signal of seriousness. A signed LOI tells lenders, partners, and internal decision-makers the deal is real, which unlocks financing conversations and board approvals.
  • Exclusivity. A binding no-shop period gives the buyer comfort to invest in due diligence without the seller shopping the property to others mid-negotiation.
  • Roadmap. The LOI becomes the term sheet the lawyers work from, shortening the drafting cycle for the definitive agreement.
06 Language

How do I write binding versus non-binding language correctly?

State it explicitly, in a dedicated clause. Do not rely on the word "LOI" or the parties' assumptions to signal non-binding intent — courts look at the words and the essential terms, not the label.

  • Declare the default. Say in plain terms that, except for the listed binding provisions, the LOI is a non-binding outline that creates no obligation to buy, sell, or enter a definitive agreement.
  • List what binds. Typically confidentiality, any exclusivity / no-shop period, governing law and dispute resolution, and the binding-provisions clause itself. Parties can make individual provisions binding while leaving the sale non-binding.
  • Reserve the right to walk. State that either party may discontinue negotiations at any time, subject only to the binding provisions.
  • Avoid contract-of-sale language. Phrases like "Seller agrees to sell" or a fixed, unconditional price read as a present agreement; "Seller is prepared to sell, subject to a definitive agreement" reads as a proposal.
  • Do not leave price and property fully definite while silent on binding intent — that combination is what leads courts to find an unintended binding contract.
07 Formality

How does the Statute of Frauds affect an LOI to sell property?

The Statute of Frauds requires that any enforceable agreement to sell real property be in writing and signed by the party against whom enforcement is sought — which cuts both ways for an LOI.

  • Writing requirement. Every US state, by statute descended from the English Statute of Frauds, requires contracts for the sale of land to be in writing, identifying the parties, describing the property, and stating the essential terms including price. An oral agreement to sell land is generally unenforceable.
  • Cuts both ways. The Statute of Frauds is not only a shield. A written, signed LOI that contains the essential terms can satisfy the writing requirement — so a document meant as a preliminary outline can supply exactly the writing a court needs to enforce a sale if the intent-to-be-bound test is also met.
  • Part performance. Many states recognise a part-performance exception (for example, a buyer who pays, takes possession, and improves the land with the seller's consent), which can enforce even an unwritten deal. The doctrine varies significantly by state.
  • State variance. The precise requirements, exceptions, and how courts treat LOIs differ by state. Never assume the rule from another state applies to yours.
08 Customise

Need a customised letter of intent to sell property?

Use AI Lawyer to generate one tailored to your sale. Set the property type (residential, commercial, land, mixed-use), the proposed price and deposit, the contingencies and timeline, and the binding-versus-non-binding split; the assistant produces an LOI with a clear property description, an explicit binding-provisions clause, and a timeline to the definitive agreement. Because a poorly worded LOI can bind you to a real-estate sale you did not intend — and because the Statute of Frauds and enforceability rules vary by state — have a licensed real-estate attorney in the property's jurisdiction review the letter before you sign it.

Draft an LOI that frames the deal without trapping you into it

Free template with a clear property description, an explicit binding / non-binding clause, deposit and contingency sections, and a timeline to the definitive agreement.

Use the template
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