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A Letter of Intent for Business Loan is commonly used in the Philippine business environment as an initial step in the commercial lending process. This document is typically prepared when a business entity is seeking substantial financing and needs to formally communicate its borrowing intentions to a potential lender. It serves as a precursor to the more detailed loan agreement, outlining key commercial terms while maintaining flexibility for negotiation. The document must comply with Philippine banking regulations, particularly those set by the Bangko Sentral ng Pilipinas (BSP) and the Truth in Lending Act. While generally non-binding, it helps establish the framework for due diligence and subsequent loan documentation. The LOI is particularly important in complex financing scenarios where both parties need to document their preliminary understanding before investing significant resources in the transaction.

1. Date and Address Block: Formal business letter format with date and recipient's complete address

2. Subject Line: Clear indication that this is a Letter of Intent for Business Loan

3. Introduction: Identifies the parties (potential lender and borrower) and their authorized representatives

4. Purpose Statement: Clear statement of intent to obtain a business loan and its primary purpose

5. Loan Details: Proposed principal amount, tentative interest rate range, and desired repayment term

6. Business Information: Brief overview of the borrower's business and financial standing

7. Use of Funds: Specific description of how the loan proceeds will be utilized

8. Proposed Security: Overview of collateral or security being offered for the loan

9. Confidentiality Statement: Statement regarding the confidential nature of the discussions and information shared

10. Non-Binding Nature: Clear statement that the LOI is non-binding except for specific clauses like confidentiality

11. Next Steps: Proposed timeline and process for moving forward with the loan application

12. Closing and Signatures: Formal closing, space for signatures of authorized representatives