Hello it's me again Peter Harris from commercial property advisers author of this book commercial real estate investing for dummies and coach and mentor to many commercial investors all across this great nation of ours just about every day I receive emails from the books are written from the podcast I've produced as well as some of the YouTube videos I post and today I'm going to answer in a very short video a one set question and the question is Peter how do you use a LOI and letter of intent to make offers on commercial property well in this video I'm going to go over and define what a letter of intent or an LOI is and how to use it effectively number two the three main purposes of ello is number three that three advantages of lis and lastly I'm going to show you at the end of video how to get your very own copy it's actually the an actual copy that we use here at commercial property advisers okay so let's get started there are two basic ways to make offers on commercial property the first way is with a typical sales contract or we sometimes call it a purchase and sell agreement the second way to make offers on commercial property is with a letter of intent or commonly commonly referred to as an LOI allow me to define what an LOI is an LOI is a one or two page document where we make offers on commercial property without all the pages of legal terms and clauses associated with a 10 or 20 page sales contract all right so again a LOI is one or two pages long and a sales contract is 10 to 20 pages long alright next is going to the three main purposes of the letter of intent and how to use it effectively number one the letter of intent is to be a bridge between your intent to buy the property alright and a legal legally executed sales contract again this side you have your intended by the property this side you have a legally executed contract and the LOI is to be a bridge between those two got it okay next is the LOI is to be is it is a way of making an offer in a very simplistic form to get the basic terms out on a table in front of the seller that's all it is all right the third advantage I mean the third purpose is the otherwise used to get the seller to come and agreement with you on what the big picture of what you're trying to do with the deal just the basic terms out on the table so that later we can negotiate all the other terms in the sales contract all right now that was a three main purposes let me share with you what the LOI is not the LOI is not legally binding in fact we call it non-binding and what non-binding means is that there's no legal force no binding force to the offer all right next LOI is not to be used to negotiate the terms then many terms that you find in a sales contract if you do that you defeat the purpose of the LOI all right the LOI you're going to find it it's just a few terms on one sheet of paper the second page is four signatures that's all of this nice and simple next is the three advantages of using Ella...
