How Do You Write a Contract Letter?

A contract letter should include information such as the description of the project, terms, parties involved and timeline. The goal of a contract letter is to formalize and summarize the specifications of an actual contract between the parties involved prior to signing.

Writing a contract letter is a helpful way for all the parties involved to review the details. It allows for changes to be negotiated prior to signing the formal document. The specific details of a contract letter will differ depending on the situation and parties involved. There are, however, basic steps that should be followed.

  1. Name the parties involved
  2. Quite often, a contract is only between two parties. In some cases, such as construction for example, there may be more. A contract letter should include any company or person involved in that project.

  3. Describe the project
  4. This is perhaps the most important part of the contract letter. The scope of the project should be stated in detail. Include information such as a timeline with a projected end date and the anticipated project costs. Be sure to list the responsibilities of each party involved in the project.

  5. Include Payment terms
  6. List payment expectations. This would include the total payment due upon completion of the project and when the payment is due. If there is up front money to be made prior to starting the project, this should be indicated as well.