How to Write a Letter of Intent (LOI) For a Bulk REO Purchase

If you are looking to purchase a bulk REO(Real Estate Owned) from a seller, you have to provide a Letter of Intent (LOI) to the seller as a first step. An LOI should be written by the buyer and makes the first impression on the seller. A professionally written LOI should contain the following information:

• Name of the Company the Buyer is representing
• Address of the Corporation
• Name of the Buyer’s Mandate
• Dated within the last 30 days
• Information on the geographical area where property is desired
• Purchase price the buyer is willing to pay including fees
• Type of property desired (residential, commercial etc)
• Level of rehab acceptable (low, medium, heavy etc)
• Due diligence period the buyer is willing to accept
• Closing time after due diligence
• How the buyer will show Proof of Funds (POF) to the seller

Sample Letter for LOI

Real Estate Corporations, Inc.

123, Main Street

San Francisco, CA 94101

(123) 456-7890

November 27, 2009

To Seller of Records,

This LOI from Real Estate Corporations, Inc. is for the purpose of obtaining a portfolio of REO properties that meet the criteria specified below:

• Purchaser: John Smith
• Buyer’s Mandate: Jack Jones
• Portfolio Price: 50Million USD
• Discounted Price: Up to 57{ef6a2958fe8e96bc49a2b3c1c7204a1bbdb5dac70ce68e07dc54113a68252ca4} of BPO + 4{ef6a2958fe8e96bc49a2b3c1c7204a1bbdb5dac70ce68e07dc54113a68252ca4} Fees
• Geographical Area: Northern California Only
• Property BPO Range: $250,000 to $1,500,000
• Property Type: Single Family Residence (SFR)
• Level of Rehab: Light to Medium
• Due Diligence Period: 72 hours
• Closing: Within 48 hours after due diligence
• Proof of Funds: Soft POF from Attorney attached
• Contact: Buyer’s Mandate on listed phone number

Please contact Real Estate Corporation’s Inc. upon receipt of this letter for further correspondence and completing all paperwork.

Signed and Dated by Buyer:

Signed and Dated by Buyer’s Mandate: