what is an LOI ?

By
Real Estate Agent

 

It's a letter of intent stating the details such as loan amount, loan term, purpose of loan, interest rate , prepayment penalty, fees, conditions required prior to closing of escrow and required deposit on administration fee, appraisal and environmental expenses. This is not a legal obligation until borrower signs it. Review the content to save yourself a lot of money on interest and prepayment penalty

 

 

Comments (7)

Richard Perkins
R PERKINS REALTY - Stockton, CA
Very good info here! Thanks for the heads up!
Oct 05, 2007 07:57 PM
Fran Gaspari
Patriot Land Transfer, Inc. - Limerick, PA
"The Title Man" - Title Insurance - PA & NJ

Nga,

And here I thought it was the plural of 'Lei', a Hawaiian term!!! :^) Thanks,   Fran

Oct 06, 2007 12:03 AM
Konnie Mac McCarthy
MacNificent Properties, LLC - Cobb Island, MD
Broker/Owner - VA & MD "Time To Get A Move On!"
I always looked at a letter of intent as a lazy way to write a contract...but it is more than that?? I did not know it could be signed...and that made it enforceable??  
Oct 06, 2007 12:21 AM
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel
Thanks for the information. I use letter of intent sometimes for buyers when they are making an offer and it starts the negotiation process.
Oct 06, 2007 12:51 AM
Anonymous
Richard
You are always welcome. Thanks for reading
Oct 06, 2007 04:46 AM
#5
Anonymous
Konnie

It's a very important tool for many reasons. Given that the amount of the loan is often large, you want to make sure you get the cheapest rate and best terms. You also want to know what kinds of conditions are required to close the deal. After all if the loan doesn't get funded,  you as an agent will not get paid for your hard work. 

 

 

Oct 06, 2007 04:46 AM
#6
Anonymous
Gita
Right on! It shows the buyer is serious and pre-qualified to buy the property. Great point.
Oct 06, 2007 04:48 AM
#7