• A letter of intent defines the terms to a forthcoming agreement.Ryan McVay/Photodisc/Getty Images
  
  A letter of intent, also known as an LOI, is a short letter outlining a potential agreement between two parties. This letter commonly states the initial terms of an agreement, and it is commonly followed by a more detailed final agreement. When creating a letter of intent, it is important to determine if the LOI is legally binding, if it will cover all important details of the impending deal as well as if any conditions must be met to establish a final agreement. Letters of intent can be used in a wide variety of settings whenever a legal agreement must be created.
  
  

Academic LOI

• A letter of intent is a common step within an application packet. This type of letter is often used in undergraduate and graduate degree programs. It showcases the applicant's desire for higher education and explains past academic achievements as well as plans for future academic endeavors. The University of New Mexico states that when writing an academic letter of intent, the applicant must include information regarding the program he wishes to enroll in, qualifications for why the school should enroll the student as well as the students plan for his academic future.
  
  

Acquisition LOI

• When a company begins the acquisition process of another business, one of the initial steps is to create an acquisition letter of intent. This letter does not contain all of the information regarding specifics of the acquisition; however, it acts as a basic outline so both parties understand the main deals of the acquisition. An acquisition LOI should be reviewed by a lawyer after both parties agree upon basic terms. Information found within this letter may include, but is not limited to, business purchase price, conditions of the acquisition, company assets and information stating this is not a final agreement. The company acquiring a business typically creates this letter and sends it to the main directors and officials of the other company.
  
  

Investment LOI

• An investment letter of intent is typically written by an investor who intends to put money into a business venture. The type of investment is not limited to currently established businesses, as an investor can create an LOI to support the idea of a business model. After discussing the initial investment terms with a business or budding entrepreneur, an investor creates an LOI, which defines the amount of money to be invested and when the money will be deposited. The letter should also consist of terms of the investment, when the business or entrepreneur should agree to the investment deal and any additional information to protect the investment money. While an investment LOI is not legally binding, it is an official document used to jump start the final agreement terms.