Intent is something that you have planned or wish to do. A letter of intent is a document articulating the purpose of an action, like a firm making a commitment to take over another firm, or a research student applying to a specific university.
A letter of intent is a document which describes an intention to take some action. From a business point of view, it is defined as an agreement between two or more parties before the agreement is finalized. It is basically a compilation of key points of an agreement between two parties who intend to conduct a business transaction.
While announcing a merger or a joint venture, a letter of intent is signed for the purpose of declaring that the various parties involved are negotiating a contract. A letter of intent is something that parties fall back on if the negotiation between the parties is sabotaged. Simply put, it is the agreement signed prior to the final agreement.
So what is the difference between a letter of intent and a memorandum of understanding? Apart from the language and other formalities, the key difference between the two is the nature of signatories.
Memorandum of understanding implies that all the parties involved have to be signatories, while a letter of intent needs only the party which proposes the agreement to be a signatory.
Also, for a memorandum of understanding, more than two parties may be involved, but for a letter of intent, only two parties are involved.
Areas in Which Letter of Intent is Used
Academia: When a scholar or a research student applies to institutes for further studies, a letter of intent is mandatory as a part of the process. It is known as a statement of purpose in academic circles.
Educational Institutes: Formation of new clubs like a debating club, a glee club, or even a pop dancing club needs a letter of intent for their approval from the administrator.
Real Estate: How would you convey to a grumpy landlord that you wish to use his property? Providing an explanation through a letter of intent is a formal way of seeing your proposal through.
Solicitation: It is a standard practice to write letters of intent in matters of solicitation. Even though it is not mandatory, but the estimate it provides is highly useful for government staffers.
High Schools: High school students who want to join a university of their choice, based on their performance, frequently make use of a letter of intent for the same.
Given below is a sample from a high school student to a university.
Sub: Application for graduate program in Physics - Florida State University
I, John Sharbatsky, a senior year student of Westside High School, affiliated to the Tennessee State University, wish to pursue my graduation in Physics from your esteemed University.
Florida State University's graduate program in physics is well-known for its path-breaking research work in the field of quantum physics.
Acceptance to your graduate program would enable me to pursue a lifelong dream of a career in quantum physics. Through this letter of intent, I would like to express my wish to join the Florida State University.
The example given above is quite self-explanatory. The letter should be kept to one page in length. Remember to proofread too, because wrong spellings and typing errors can create a negative impression.
One should always keep a copy of the letter of intent; to be able to resend in case the letter is lost in transit, or for future reference. Hope this article would have helped you in understanding what is letter of intent and its use in different fields.