4. On Offer acceptance there is either a contract generated or a pro forma invoice generated. Since the offer is binding once accepted, the offer if well enough detailed and advised can and often does take the place of the contract.* Customarily in Real Estate transactions the purchase offer itself is generally also the contract for purchase as well. The offer becomes a binding contract once accepted.The Letter of Intent is not binding, and rather silly at the worst of times. An LOI by definition only registers intent to purchase, and it specifies this intent weakly, and due to its ambiguity should be avoided.
Some of these instances include: Schools: Many times a school will require a letter of intent when a new club or group is forming. Expansion or downsizing: Letters of intent are sometimes used to let employees of large firms know that the company plans on either expanding or downsizing certain departments.