What is a letter of intent to buy, what to look out for and why is it important?
Whether we find the property that suits us best through a real estate agent or privately, we must express our intention to buy to the seller. In order to avoid any potential conflicts or misunderstandings between the parties, it is advisable to draw up a verbal agreement between the buyer and the seller, including the main elements of the transaction. A purchase offer accepted by the seller provides both parties with sufficient guarantees to ensure that the parties are secured until the final sale and purchase agreement is concluded (the seller should not accept another offer and the buyer should not put his/her money on another property).
An accepted letter of intent to buy is in fact a pre-contract, so it is not all the same what we put on the table. Real estate agents usually have a letter of intent form, but in a deed prepared by a lawyer, the parties can set out the terms of the contract in great detail and precision.
The letter of intent to buy must necessarily include the following relevant points:
- details of the contracting parties,
- Property data (it is important to not only record the property’s location and address, but also the rights and relevant facts recorded on the title deed) At this point, it is worth asking for the help of a real estate expert, so that no one is surprised if a usufructuary right or mortgage right has been registered for the property in question, or if other important facts have been recorded regarding its buildability),
- the amount of the purchase price,
- payment schedule for the payment method,
- condition and date of taking possession,
- the condition of the property,
- the scope of the purchase offer.
In order to avoid problems and inconveniences later on, it is important to sign the letter of intent to purchase and at the same time to put down a deposit only if you are absolutely sure that you are going to conclude the transaction, as the contents of the letter of intent to purchase form the basis of the final sales contract.
