What Is a Letter of Intent?
A Letter of Intent is a written communication that outlines a party’s intention to enter into a formal agreement. Think of it as a preliminary handshake—a concise, professional document that signals your genuine interest, proposed terms, and how you see things progressing. It’s not legally binding in most straightforward cases, but it does lay the foundation for what may follow.
Why Use a Letter of Intent?
- Clarifies Intent Early
A thoughtfully composed LOI conveys your purpose—whether you're signaling interest in employment, collaboration, or a joint venture—without waiting for a full contract. - Helps Define Preliminary Terms
By including key elements—like timelines, proposed roles, or confidentiality expectations—an LOI helps align expectations early and avoid misunderstandings later. - Demonstrates Professionalism
Putting your intentions in writing gives your proposal structure and legitimacy, showing you’re serious and organized. - Guides Next Steps
An LOI often serves as the roadmap: indicating your willingness to further negotiations or due diligence, and suggesting what those steps might be.
When to Use a Letter of Intent
- Job Applications for Strategic Roles
Especially useful when you want to express enthusiasm beyond just sending a resume—such as for leadership or niche positions. - Business Partnerships or Joint Ventures
Propose initial terms, non-disclosure expectations, or timelines before drafting a full agreement. - Seller-Buyer Scenarios
In mergers, acquisitions, or property sales, LOIs help outline conditions before formal contracts are negotiated. - Academic or Fellowship Applications
Express your interest, showcase goals, or describe how your objectives align with an institution or program.
Key Components of a Strong LOI
A well-structured Letter of Intent typically includes:
- Header and Date
Your contact info, then the date. - Recipient Details
Name, title, and organization of the recipient. - Subject Line / Opening Statement
E.g., “Letter of Intent Regarding [Role/Position/Event]”—followed by a succinct purpose statement. - Expression of Interest or Intent
Clearly state why you’re reaching out and what you hope to achieve. - Highlighted Terms or Expectations
This could include proposed start dates, project scope, responsibilities, confidentiality clauses, or intention to proceed to contract. - Outline of Next Steps
Suggest actions or timelines for follow-up—like a meeting request, draft agreement, or signature deadline. - Gratitude and Professional Closing
Thank the recipient for their time and express anticipation for next steps, followed by a closing (e.g., “Sincerely”) and your signature.
Best Practices for Writing LOIs
- Be Clear and Concise
LOIs should be direct and to the point—avoid overloading with details better saved for later negotiation. - Confirm Non-Binding Intent (When Appropriate)
If necessary to preempt misunderstanding, include a line that clarifies the LOI is not legally binding but serves as a mutual expression of interest. - Align Tone with Context
Adjust tone based on context—formal and reserved for legal/business LOIs; warm and aspirational for academic or nonprofit applications. - Proof and Revisit
Double-check names, titles, and key components before sending—clarity matters at early stages of intent.
When to Be Cautious
- Risk of Premature Commitment
If legal clauses are too rigid or binding language is present, you may inadvertently obligate yourself. Keep it open, unless binding terms are truly intended. - Overstating Terms Too Early
Avoid setting ultimatum-like expectations where flexibility and collaboration are preferable at this stage.
Final Thoughts
A Letter of Intent is your professional opening act: a space to show interest, lay out preliminary ideas, and set the tone for future negotiation. When done well, it builds confidence, demonstrates clarity, and moves things forward constructively.