A letter of undertaking is an assurance by one party to another party that they will fulfill the obligation that had been previously agreed on, but not written into a contract. This letter of undertaking concerns completion monies to be paid into the vendor’s account provided that the transaction between him and the purchaser is completed. The letter is written by the purchaser’s solicitors on his behalf and denotes the conditions and designated bank concerning the completion monies.
This document should be carefully read by the Purchaser and the Vendor. Both parties should sign and return a copy, and once signed, both parties should get a copy. The Completion Monies Amount, conditions of getting the money and the designated bank should all be clearly stated in the letter. If either party wishes to amend/contest the conditions in the letter in the future, they should write an instruction letter to instruct their solicitors to do so.
letter of undertaking,
escrow of money,