How to Write an Agreement: Everything You Need to Know
How to write an agreement letter is a simple set of steps. 3 min read
4. Typing the Letter
6. Send for Review
How to Write an Agreement
How to write an agreement letter is a simple set of steps. But before you begin writing the agreement letter, be sure that both you and the other party know what you are agreeing to.
You should meet and discuss, whether in person or on the phone the terms of the agreement. Make sure to take clear and detailed notes.
If you are unhappy or anxious about some of the terms, you can try to negotiate with the other party before finishing the agreement. However, successful negotiation usually includes giving something away in order to get something you want.
Feel free to debate specific provisions in the contract. Offer to add a provision that you know the other party would like if they would be willing to remove a provision that you are unhappy with.
An agreement letter is usually less formal than a contract. However, it still needs to be sufficiently definite so that both parties fully understand what is has been agreed to.
Include a specific outlining of the contract schedule and the means of payment in the contract. Do the parties want to pay/receive payment in one lump sum? Would you prefer a down payment with monthly installments? Make sure to specify. And if payments need to be in a particular medium – cash, check, or credit card – specify that as well.
Before writing the agreement letter, use the notes you took during your meeting/negotiation, and outline the agreement. Try to organize the information in a manner that makes sense.
The outline can be as simple as:
- Nature of work
- Payment details (price, means of payment, schedule)
- Beginning and end dates
Typing the Letter
Once you have your outline, type your agreement letter. Make sure it is readable in both size and font. At the very top of the page, in the center, include “Letter of Agreement” in bold. Include five or six lines of blank space at the top so that you can use letterhead when you print it, if you have it.
The letter should read like a regular business letter.
Make sure to include
- The date
- The other person’s address (below your address if you are not using letterhead)
- If you are not using letterhead, include your address below the title.
- “Dear Ms. Jones” or “Dear Mr. Smith”
- Signatures of both parties (including the typed names below each signature for clarity)
The first paragraph should state why you are writing the agreement letter and the purpose statement.
In as much detail as possible:
- Outline the tasks to be performed
- Explain any deadlines or timelines
- ex: state when rough drafts are due
- Describe how revisions or edits are handled including, but not limited to the number of revisions allowed/expected
- Include how much you will be paid
- When the payment(s) must be made
- How much must be paid upfront, if there is a down payment required
- Include a cancellation clause
- Explain how much a party owes for partial work if they want or need to cancel before completion
- Specify the term of the contract: start and end dates
- State what law governs in the event of a dispute
- Add a non-disclosure or confidentiality clause if necessary
- Specify whether the other party must return the information or property when the contract is over
- If this is the final agreement that includes all the things agreed to, include a merger clause saying so
Send for Review
Send a copy to the other party for review. Give them about a week to review, object to anything in the agreement, return with corrections, or return with signature(s). You can then type the final letter. If you disagree with their objections, you may need to sit down with them again to come to an agreement. Do not sign the letter until everyone agrees to all provisions as written.
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