identify property meeting a set of criteria set out by the buyer. Types of buyers may include an owner-user, private investor, acquisitions, capital investment, or private equity firms. The buyer or its agents will perform an initial assessment of the physical property, location and potential profitability (if for investment) or adequacy of property for its intended use (if for owner-user). If it is determined the prospective investment meets the buyer's criteria, they may signal their intent to move forward with a letter of intent (LOI). Letters of Intent are used to outline the major terms of an offer in order to avoid unnecessary costs of drafting legal documents in the event the parties do not agree to the terms as drafted. Once a Letter of Intent is signed by both parties, a purchase and sale agreement (PSA) is drafted. Not all commercial property transactions utilize a Letter of Intent although it is common. A PSA is a legal agreement between the seller and a single interested buyer which establishes the terms, conditions and timeline of the sale between the buyer and seller. A PSA may be a highly negotiated document with customized terms or may be a standardized contract similar to those used in residential transactions. Once a PSA is executed, the buyer is commonly required to submit an escrow deposit, which may be refundable under certain conditions, to a title company office or held by a brokerage in escrow. The transaction moves to the due diligence phase, where the buyer makes a more detailed assessment of the property. Purchase and sale agreements will generally include clauses which require the seller to disclose certain information for buyer's review to determine if the terms of the agreement are still acceptable. The buyer may have the right to terminate the transaction and/or renegotiate the terms, often referred to as "contingencies". Many purchase agreements are contingent on the buyer's ability to obtain mortgage financing and buyer's satisfactory review of specific due diligence items. Common due diligence items include property financial statements, rent rolls, vendor contracts, zoning and legal uses, physical and environmental condition, traffic patterns and other relevant information to the buyer's purchase decision specified in the PSA. In competitive real estate markets, buyers may waive contingencies in order to make an offer more appealing to a buyer. The PSA will usually require the seller to provide due diligence information to the seller