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While most are not legally binding, there may still be consequences for not complying with the agreed upon portions of the letter. A Letter of Intent is often seen like purchase or crowd-sourced orders, so they are often used to help secure funding or prove the value of the business. If the other party drops out or doesn't honor "in good faith" the letter, actual financial damage may be incurred to the company. In court, most often the judge will make decisions based on what implied intent is expressed in the letter. Sometimes there can be recourse if the parties do not follow through towards an actual legal agreement.

Understanding what a Letter of Intent is and when to use them is a bit confusing. But basically, this letter just means you are serious about continuing towards a purchase and that you want the other party to stop entertaining other offers. Our Letter of Intent template is suitable for all states.

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