Letter of Intent (LOI)

A Letter of Intent sets out the proposed price, deposit, inspection scope and timeline for an aircraft purchase, usually with funds placed in escrow. It moves a deal from conversation to process. Price is only part of it — inspection scope, delivery condition and who pays for discrepancies found often matter just as much.

Why it matters: the LOI is where a deal takes shape — price, deposit, inspection rights, timeline and exclusivity, agreed before either side spends serious money on inspections and lawyers. Most of it is typically non-binding, but the provisions that matter most, like exclusivity and deposit treatment, are usually binding by design.

Negotiate the LOI as if it were the contract, because it anchors everything after: what the inspection may cover, what happens to the deposit on findings, and the delivery condition the purchase agreement will formalise. A vague LOI produces the disputes; a precise one prevents most of them.